I.

KNOW ABOUT THE FACT

KFC was founded by Harland Sanders (Sanders) in the early 1930s, when he started cooking and
serving food for hungry travelers who stopped by his service station in Corbin, Kentucky, US. Kentucky
Fried Chicken was born. Soon, Sanders moved across the street to a motel-cum-restaurant, later named
'Sanders Court & Cafe,' that seated around 142 people. KFC is based in Louisville, Kentucky, and is the
world’s most popular chicken restaurant chain. Foreign fast food companies were allowed to enter India
during the early 1990’s due to the economic liberalization policy of the Indian Government, KFC was among
the first fast food multinationals to enter India On receiving permission to open 30 new outlets across the
country, KFC opened its first fast-food outlet in Bangalore in June 1995. Bangalore was chosen as the
launch pad because it had a substantial upper middle class population, with a trend of families eating out.
It was considered India’s fastest growing metropolis in the 1990s. Apart from Bangalore, PepsiCo planned
to open 60 KFC and Pizza Hut outlets in the country in the next seven years. However, KFC got embroiled
in various controversies even before it started full-fledged business in India. When the issue of granting
permission to multinational food giants to set up business in the country came up for discussion in the
Indian parliament, some members from the opposition parties were vocal in their displeasure. From the
very first day of opening its restaurant, KFC faced problems in the form of protests by angry farmers led by
the Karnataka Rajya Ryota Sangha (KRRS). The farmers leader, Nanjundaswamy, who led these
protests,vehemently condemned KFC's entry into India, saying that it was unethical to promote highly
processed 'junk food' in a poor country like India with severe malnutrition problems.

II. STATEMENT OF THE PROBLEM

Since its entry in India in 1995, KFC has been facing protests by cultural & Economic activists and
farmers. From the cultural and economic activists and farmer’s perspective there were numerous
disadvantages with the opening of these fast food chains, in particular KFC. From an economic viewpoint,
the opening of more KFC chains initially stimulated employment and infrastructure opportunities as well as
providing the Indian economy (FDI) with many benefits. And also KFC is in fierce competition but then they
didn’t give an importance to ethical values at the cost of making profits.

III. OBJECTIVES

The objectives of this study, is to know the justifiable reasons of why KFC faced a severe protest by
cultural & economic activists and farmers. And also able to know on what are the reasons why KFC did
not give an importance to the ethical values of their business. And to find a possible solution for the specific
problem.

IV. ALTERNATIVE COURSES OF ACTION

Since, the regulatory authorities found that KFC's chickens did not adhere to the Prevention of
Food Adulteration Act, 1954. It could be their alternative courses of actions: they must understand first
the significance of cultural, economic, regulatory, and ecological issues while establishing business in
foreign country. Also learn to appreciate the need for protecting animal’s rights in developed and
developing countries like India so that they can’t make issues.

V. SUMMARY OF:

A. FINDINGS
 I found out that KFC is a non-ethical business practice. Also I found out that no tolerance for ‘cruel
multinationals’ was the main reason for the protests made by cultural and economic activists and farmers.
And for the cultural aspect, the main fear for nationalists and cultural activists was the disturbance to the
Indian culture and the effect of globalization. Though KFC had implemented traditional Indian dishes such
as ‘tandoori chicken’ and ensured that it was more nutritious, this does not enquire that the majority of those
who visit KFC will not go for other junk-food alternatives. With a low rate of obesity, hypertension, heart
disease and cancer, India now faced a threat to these illnesses caused by high sodium and cholesterol
through the consumption of meat, fried, and processed foods. And for the economic aspect, for KFC itself
there is a competitive advantage gained through penetration strategies and the allowance for a wider target
market. The main criticism from economic activists came from the fact that only those in the upper middle
and affluent classes would be able to afford KFC.

B. CONCLUSIONS

In summing up, KFC should implement a farm level guideline and audit program (a program which
is industry-leading in the areas of poultry care and handling, mainly for their suppliers in the boiler industry).
And finally, we can understand from the case that every business organization should understand first the
importance of ethics by understanding the culture, regulatory, and ecological issues in different countries
in putting up an international business.

C. RECOMMENDATIONS

I recommend that KFC must engage in CSR activities related to animals and environment.
Developed a strong culture of good service and change the image of KFC from fried to “healthy” ones, and
introduce a new recipe suited to local taste. And lastly, they must know first the significance of the
regulatory, culture, and ecological issues of a different countries.