Supply Chain

Management
Group Members:

SUBMITTED TO :SIR ANAS IFFTIKHAR

1.Company Profile
2. Parent Company
3. Cupola Pakistan
4.Cupolas Vision
5.Cupolas Mission
KFC Pakistan
KFCs Mission
Values of KFC

 Core competency
Franchise Locations
Organization Structure

KFC Supply Chain

PROCUREMENT
Chicken
Sauces
Spices and herbs
Packing Material
Bread and Buns
Fish
French Fries
Other miscellaneous items
STORAGE AND INVENTORY MANAGEMENT
Chicken
Sauces.
Spices and Herbs
Bread and Buns
ZONAL DISTRIBUTION

1.Vehicles
2.Company: Hyundai Shehzore.
3.Company: Hino Dutra Truck.
4.Quality Assurance
ACKNOWLEDGEMENT:The completion of this project leaves one spent, but with a sense
of jubilation, a sense of achievement, having reached the end of a long arduous road cannot be put to
words. The time has come, when we take upon myself the gracious opportunity of expressing
our heartfelt gratitude to mank ind souls, who have helped and supported me, on this road we are very
grateful to our most esteemed and revered faculty guide SIR ANAS IFTAKHAR faculty at IQRA
UNIVERSITY, and suggestions which helped us on each and every step of our project. Thanking him will not
be sufficient to the inputs that we have got from him. we are also sincerely thankful to Mr. Wasif Qazi value
chain manager in KFC outlet Karachi) for the co-operation and assistance during the project. W e t a k e
t h i s o p p o r t u n i t y t o e x t e n d o u r t h a n k s t o o u r f a c u l t i e s w h o directly or indirectly have
supported us during the project. O u r w o r d s c a n n o t e x p r e s s o u r d e e p f e l t g r a t i t u d e t o w a r d s
our famil y and friends whose support and encouragement have helped us to cross all
t h e hurdles that came in our way.

COMPANY PROFILE:
KFC Corporation:Based in Louisville, Kentucky, is the world's most popular chicken
restaurant chain, specializing in Original Recipe, Extra Crispy, and
Kentucky Grilled Chicken. Every day, more than 12 million customers
are served at KFC restaurants in 109 countries and territories around
the world. KFC operates more than 5,200 restaurants in the United
States and more than 15,000 units around the world. It is the worlds
largest and most well known chicken restaurant, with chains in more
than 10 thousand locations and worldwide in 80 countries. KFC and
its franchised employees are more than 200 thousand, all over the
world. KFC is world famous for its Original Recipe fried chicken -made with the same secret blend of 11 herbs and spices Colonel
Harland Sanders perfected more than a half-century ago. Customers
around the globe also enjoy more than 300 other products -- from
Kentucky Grilled Chicken in the United States to a salmon sandwich
in Japan.

PARENT COMPANY:
CUPOLA PAKISTAN
Cupola is a Dubai based multinational company and has been at the
forefront of development in Food & Retail sector for over a decade.
Its flagship brand KFC has amassed itself as the dominant concept in
the Quick Service Restaurant (QSR) business in the country.

Cupolas Vision:

Cupola, Pakistan Ltd. aims to,

Create value through change, challenging

existing paradigms by applying vision, innovation
and skilled execution.
The company has always accentuated corporate social responsibility
through various initiatives taken under the banner of its flagship
brand KFC. These include setting up of libraries in various

Supply Chain Management schools, provision of training for teachers

and now to educational support for under privileged children.

Cupola's mission:

Is to harness and reap the potential of the

rapidly developing markets of the Arabian Peninsula and South Asia.
In the mature capital markets of Europe and the United States, they
are well regarded as innovative and creative niche investors. They
believe in the minimization of risk: through the depth of their senior
management and the quality of their professional staff; through
exhaustive and through an emphasis on pre-feasibility. Everyone in
Cupola shares an almost obsessive drive for quality, an active
consciousness of the team approach and a commitment to their
collective success. They strive continually to improve the tangible
and intangible returns for all their stakeholders.

Cupolas Businesses:
Cupola is involved in several business including, oil
gas exploration, plastic cards, retail markets and food franchising.

Cupola holds the master franchise rights to operate KFC in Pakistan.

Some of the businesses which are under contract with Cupola
Pakistan are,
1. KFC
2. Indulge
3. My Superstore
4. Lal Qila
5. The bakers

KFC PAKISTAN:
Food, fun & Festivity, this is what KFC is all
leading the market since its inception; KFC provides the ultimate
chicken meals for a chicken loving nation. Be it colonel sanders
secret original recipe chicken or the hot & spicy version, every bite
brings a yum on our face. At KFC they say,
We do chicken right.
Supply Chain Management Perfecting its secret recipe of 11 herbs
and spices in 1939, KFC has come a long way. With over 10,000
outlets in the world, KFC has maintained its title, for the last 60
years, of being the chicken Experts. Opening the first KFC outlet in
Gulshan-e- Iqbal in 1997, KFC wore the title of being the market
leader in its industry. Serving delicious and hygienic food in a
relaxing environment made KFC everyones favorite. Since then, KFC
has been constantly introducing new products and opening new
restaurants for its customers.

KFCs Mission:
KFCs mission statement is,

To be the leader in western style quick service

restaurants through friendly service, good quality
food and clean atmosphere
KFC Pakistan has contributed in providing Halal and Hygienic
products to its customers and managed this through proper
training of its human resources. It has created competitive level for
other thus improving the overall industry standards.

Values of KFC:
To establish a position in Pakistan as a
leading WQSR (Western Quick Service Restaurant) c h a i n ,
serving good value added services and Innovative
c h i c ke n b a s e d p ro d u c t s. K F C i s consistently providing a
pleasant dining experience, with fast friendly, in a clean and
convenient location. Every moment dedicated to providing excellent
and delighting customers.
Focusing all resources to the restaurants operation because that is
where they serve their customers.
Reward and respect the contributions of each individual at KFC.
Expand and update training with time and be the best we can be and
more.
Be open, honest and direct in our dealings with one and other.
Commit themselves to the highest standard to the personal
and professional integrity at all times.
E n c o u r a g e n e w a n d i n n o v a t i v e i d e a s b e c a u s e t h e s e a re
t h e ke y t o t h e i r c o m p e t i t i v e growth.
Reward result and not simple efforts.
Dedicate themselves to continuous growth in sales, profit and size of
organization.
Work as a team.

Core competency:

Since beginning, KFC has presented itself and well

competed, only through it delicious chicken. People from all over the
world know KFC as the best chicken expert. Their chicken has always
been unique in taste and has helped them in order to build their own
identity all over the world.

PRODUCTS OF KFC:
KFC Pakistan provides 100% Halal and Hygienic products to its
customers. It offers a variety of finger-licking products, some of
which are as follows:
1 . C r i s p y Fr i e d C h i c k e n
2 . Z i n g e r
3 . Tw i s t e r
4. Hotshots
5. Chicken Burger
6. Hot wings
7. Rice n Spice
8 . Fi s h Z in g e r
9 . N u g g e t s
1 0 . C o rn o n t h e C o b
1 1 . Fre n c h Fr i e s

FRANCHISE LOCATIONS:
Presently KFC is branched out in eighteen major cities of Pakistan
with around 64 outlets nation-wide. Some of the cities in which the
KFC is in operation are as follows,
1. Karachi
2. Hyderabad

3. Lahore
4. Islamabad
5. Sukkur
6. Faisalabad
7. Gujranwala
8. Rawalpindi
9. Sialkot
10. Multan
11. Peshawar
12. Jhelum
13. Murree etc.

SUPPLY CHIAN:KFC has a very simple supply chain. As the

operations are on a relatively small scale, all the operations are
performed by the company (i.e. Cupola) itself. The supply chain
process can be assumed up as a 3 step process:

Step 1:

Raw materials procured from various suppliers and stored at two

warehouses; the normal-storage and the cold-storage. Details are
discussed later.

Step 2:

All product preparation is done at the branch except for the

marinating of chicken and sold to customers at the branch itself or
delivered at the desired locations.

Step 3:

Warehouses replenish each branch according to their requirement

(usually three times a week) using companys own vehicles and
drivers upon the request of the branch manager.

SUPPLIER RELATIONSHIP

 As we talked to the manager. He told us that K.F.C and cupola

always try to build a good relation with their suppliers.
K.F.C dont go for cost saving but they always work for cost
management.
They treat their suppliers as their own family.
Afeef groups are the main suppliers of K.F.C and almost 80%
of work is done by them
K.F.C helped Afeef groups to become builders and many
more.

WAREHOUSING:
Pakistan is divided into two areas, namely
North and South. The area below Multan falls under the southern
region whereas, Multan and the area above it falls under North
region. Each region hence has its own warehouse. The North region
has its warehouse in Lahore. The south region has its warehouse in
Karachi.

PROCUREMENT:
Monthly budgets are made to plan
purchasing activities. These comprise of dividing the allocated
budget into the inventory policies already defined at the warehouse
from past data and experience.

FIFO:

method is used for all items for the inventory at the

warehouses.

Chicken:
Chicken is supplied by MENU in customized cut, packed and labeled
packets directly to the warehouses in each region. Labeling is
necessary for inventory management and efficiency. KFC gives a
lead time to menu of one week for them to deliver their order. The
chicken arrives in special freezer fitted van which keeps the chicken

frozen

while

it

is

being

transported.

The

Supply Chain Management different types of pieces ordered by the

warehouse are in baskets of 5 square feet and having a height of 8
inches. The vehicles used for this are small trucks which have a
maximum loading capacity of five tons.

Sauces:

Unilever (yum) provides all the sauces needed by KFC such as

Ketchup, Chilly Sauce, Mayonnaise, Tartar Sauce etc. Yum is a brand
especially made for KFC and cannot be sold in the market to the
customers. These are delivered directly to each warehouse by
Unilever themselves. The lead time for this operation is about two
weeks.

Spices and herbs:

These are imported directly from Dubai and Singapore. The lead time
for these exceeds two months as these are not perishable items and
it takes a lot of time for transportation. All imports are done through
sea in dedicated 20 containers for KFC.

Packing Material:

This is purchased from local parties namely Afeef Packaging, AAA

and Gold Packages. Due to frequent re-designing of boxes and deals
offered by KFC, the inventory of these is kept at a minimum.

Bread and Buns:

Since the last 4 or 5 years KFC has been producing their own buns in
their own bakery. Their plant is located at Sohrab Goth, Karachi .

Fish:

Internationally, fish is bought from Thailand. But in Pakistan, fishes

bought from local vendors as it is a low selling item.

French Fries
These are imported directly from America. They are also imported to Pakistan by Yum
Company through china where they also come from America.
Other miscellaneous items:
Oil Dalda
Vegetables Local
Suppliers Rice

Hub Salt
Toys Hong Kong
Corn America

STORAGE AND INVENTORY

MANAGEMENT

Chicken:
Inventory of chicken is for 15 days. The storage area for chicken is
not in the warehouse itself but in a separate cold storage area built
right beside the warehouse in each region. Before marinating, the
chicken is stored in an organized form in six separate cold storage
rooms whose area is around 45 to 50 square feet, having a height of
around 7 feet. The chicken is stored in the same baskets which it
comes in and stays there till its turn for marinating. Mari nation is
done in a separate room in the same cold storage facility where the
chicken is first washed and mixed with the herbs and spices it needs.
The mixture is fed into a machine known as.

Tumbler:

Which marinates it. After this is done the chicken is re packed into
labeled clear plastic bags with stickers on them showing the
description of the item inside it and the expiry for it. These bags are

then put into separate cold storage room, again in an organized

form.

Sauces:

Inventory for Sauces are stored for around 25 to 30 days depending

on the forecasted sales and the expiry dates for each.

Spices and Herbs:

Inventory for these are stored according to forecasted sales and the
three months lead time given by the procurement department.

Bread and Buns:

Buns are provided directly to the branches at KFC from the factory
after every 4 days.
There is a weekly audit of every single inventory item at the
warehouse to match it with the numbers in the system as
deviations are high due to high replenishment cycles.

ZONAL DISTRIBUTION:-

Distribution is done on need basis. The cities are divided into zones
and the routes taken are accordingly. Karachi is divided into 3 zones:

Zone 1:

Gulshan-e-Iqbal and Gulistan-e-Johar

Zone 2:
Clifton and Defence

Zone 3:

Bahadurabad, Tariq Road and Sindhi Muslim Society Daily 5 to 6

vehicles are dispatched from the south warehouse for the interior
Sindh (15 days inventory) and Zonal distribution in Karachi (1 week
inventory for normal-storage and 2 days inventory for cold-storage
goods).

Vehicles Company:
Hyundai Shehzore
Hino Dutro Truck

Quantity:
4-5

Gross vehicle weight

8.90 tons

Maximum capacity:
4 tons (reduced from 5 tons because of modifications)

QUALITY ASSURANCE:There are multiple ways by which KFC

assures the quality of its products. Some of the ones which were
disclosed to us were:
Surprise visits to branches
Planned visits to branches
Rigorous raw material inspection
Customer feedback

SOFTWARE MRP/ERP:-

The company uses Supply Chain

Management (SCM) Software to manage its inventory across its
whole supply chain. This software has been developed by Siddhat
Haider. There is a weekly physical count of the inventory to tally it
with the figures in the softwares.

CONCLUSION:An overall study of Supply chain management, it has been observed that KFC in allo v e r P a k i s t a n
f o l l o w s a s i m i l a r p a t t e r n o f S u p p l y c h a i n t h a t e n a b l e s i t t o r e d u c e t i m e involved
to reach end customers and reduce expenses in supply chain. Ultimately it is able t o r e a c h a n d
f u l f i l l i t s e n d c u s t o m e r s n e e d s a n d w a n t s a t a r e a s o n a b l e o r c u s t o m e r acceptable
rates all over Pakistan.
In short we can say the Supply chain management of KFC has positive
impaction profit maximization by considering following points:
1. KFC (HQ) Karachi supplies ingredients to its entire outlet by its own transportation network all
over Pakistan
2. KFC follows a periodic review system to keep track on all its inventory and market demand