Business Secrets of Franchises: Learning from the First KFC in China

My jaw dropped when I learned he opened the first KFC in China!

I’m talking about Don Pierce, who ran franchising for KFC, Taco Bell, Pepsi.

He took El Pollo Loco from seven barrio kitchens to the first national fast food franchise endorsed by the American Heart Association.

He took Winchell’s Donuts public. And much more.

Don participated in a strategy event I lead last week for a favorite client. What a thrill to meet him and tap into his vast wisdom of big, global business — one that’s successfully operated by people like you and me.

While you might not run a franchise, you can learn plenty from them because they are well-established, well-documented business models that dominate the market, attract investment capital, and attract customers.

Want to know what I learned from Don?

I thought so! Here are the three big takeaways…

Breaking into New Markets Requires Breaking the Rules

When Don opened KFC in China, he couldn’t take money out of the country.

How can a franchisor make money if they can’t take money?

While this might stop most executives — business rules demand profit payments — it didn’t stop Don.

Don asked, “So, what can I take out of China?”


KFC China bought furnishings that they exported to open other stores world wide.

Would you have taken your profits in products? Why not?

What rules will you have to break to expand where you want to take your company?

Growing a Franchise Means Growing the Franchisee

A franchisee may be really good at opening one store, or two, or three.

Yet when it comes to opening the fifth store, they have to grow as a business executive, acquiring new business acumen because they have to balance future growth strategy with day-to-day tactical management.

When it comes to opening the 10th store, they have to evolve as a business leader because they are now fully looking far into the future, requiring new skills, tools, and making decisions that may not come to fruition for years.

Are you now on the self-development path to grow your capacity to grow your business? What go you here won’t get you where you want to go.

Trust the Franchise System and Make it Personal

A franchisee purchases a business system from the franchisor because it’s a proven method to make money. It’s almost a sure-fire business.

Trust the system because the franchisor is bringing their history, experience, and wisdom to you in a package that means you don’t have to make the same mistakes they did.

Many franchisees experience problems because they try to change the system without knowing what they’re doing or understanding the ripple effect of their choices on the system.

The most successful franchisees make the system personal. They bring their personality to the business without changing the business rules, which means that they adapt the business to their local customs and tastes. It’s a winning combination.

Do you have a documented set of business rules that makes up your business system?

Can you hand an operating manual to a capable manager and they run the business with minimal oversight?

The Bottom Line

Franchisors bring a well-oiled machine to market that has a very high probability of success. Does this describe your business?

If so, why not consider creating a franchise.

If not, this is where your focus must go for a sustainable, scalable, profitable, and salable business.

One way to do this is join me for the Executive Strategy Skills Summit and Business Accelerator System.

If you’re interested, contact me and I’ll discuss prospective dates and share the system with you.

Oh, and would you want me to invite Don to be there, too?

Wishing you all the growth you want!

Comments are closed.