KFC targets drivers with new China stores

Chinese KFC customers can now fill their bellies and their gas tanks in one trip.

Yum China Holdings Inc., which holds exclusive rights in mainland China to KFC, has opened its first franchised KFC gas station restaurants. The new stores were opened in collaboration with China Petrochemical Corporation (Sinopec) and China National Petroleum Corporation (CNPC). These openings follow an announcement made in March 2019 that Yum China would develop franchised restaurants at Sinopec and CNPC gas stations across China.

On Dec. 17, 2019, the first franchised KFC restaurant since signing the cooperation agreement was opened in a CNPC gas station in Kunming, Yunnan Province. Meanwhile, in Dalian, Liaoning Province, the first KFC franchised restaurant in a Sinopec gas station is set to open on Dec. 23, 2019.

At present, Sinopec and CNPC collectively operate over 50,000 gas stations in China, of which more than 30,000 belong to Sinopec and more than 20,000 belong to CNPC. The partnership with both companies will enable Yum China to accelerate the expansion of its portfolio of brands, which also include Pizza Hut and Taco Bell, into gas stations and highway service areas across the country. Under the cooperation agreements, Yum China has a target to open over 100 stores over three years, using a variety of different models.

"We are delighted that within a year, our collaborations with Sinopec and CNPC are already starting to bear fruit. The first franchised gas station restaurants represent an important milestone in our long-term strategic partnership with both companies," said Joey Wat, CEO of Yum China. "Together with Sinopec and CNPC, we are committed to building a successful business model and creating innovation-driven growth together."

These openings come after a pilot franchised KFC restaurant successfully opened in October 2018 at a CNPC gas station located in Tangshan, Hebei Province. According to the agreement, KFC has become CNPC's only Western quick-service restaurant franchise partner in its gas station channel.  Yum China will also work with Sinopec and CNPC to explore additional opportunities to collaborate in other consumer-facing fields.