Pizza Hut Business Analysis

I. Introduction to The Firm Pizza Hut is an American restaurant chain and international franchise. The company was founded in June 1958 by two Wichita State University students, Brother Dan and frank Carney. Pizza Hut is currently a subsidiary of Yum! Brand, Inc. since 1997and it is one of the world’s largest restaurant companies. Thought-out the years, Pizza hut has encountered some challenges and poor performance, but it is overcoming those challenges to survive in the global market. Yum! Brand has three main brands KFC, Pizza Hut and Taco Bell. In 2015, the Yum! Brand had over 42,000 outlets in 130 countries (Dutton, 2016). It is composed of company-owned, franchised, licensed and unconsolidated affiliates. Thus, it allows the company

Also, it is the only full-service restaurant brand that Yum! Brand has. However, Pizza Hut has several different formats, such as, the family-style dine in location, store front delivery, carryout locations, and hybrid locations that have carryout, delivery and dine-in options. Currently, Pizza Hut operate in more than 100 countries and has over 14,100 restaurants which 47% are located outside the United States (Dutton, 2016).

Pizza Hut is knowns for its Italian-American cuisine menu including pizza and pasta, but it has some side dishes like buffalo wigs, breadstick and garlic bread. Recently, the menu grew more diverse as the brand expanded offering salad, dessert and local specialties. The diversification of Pizza Hut’s menu is through partnership with company that are well known for its product. For example, Pizza Hut is able to offer an 8-in cookie by partnering with Hershey. As a result, this partnership has enable the company to earn extra revenue and satisfy the customer need for delicious dessert.

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Pizza Hut is implementing local adaptation to scope with every challenge in its local market. Thus, Pizza Hut announced on November 19, 2014 the rebrand of the company.

Pizza Hut adaptation is the result of Yum! Brand decentralization control which allow each of its branches (KFC, Pizza Hut and Taco Bell) freedom to compete against its local competitor. This way Yum! Brand could penetrate emerging market where the potential of success is high and give freedom to develop product that tailor local preference. Also, the struggle in China shows the importance of market diversification.

Regardless of the economic downturn in China, Pizza Hut sees a lot of potential in the Chinese market and it is most important market for global growth. As a result, Pizza hut is opening more than 259 new outlets in 2015 (Dutton, 2015). It will increase the brand presence for customer. Pizza Hut insist on investing in China because there still potential for growth of the market and a particularly high return on investment. For example, Pizza Hut in China is performing a lot better than its franchise in the United States because of the strong competition. Pizza Hut is planning to expand to second and third tier cities in