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Video Tip: Delivering Fast Food and Groceries in Asia

December 14, 2011

 I was about to blog about a video of how the Home Plus  Korean supermarket chain has extended its “storefronts” into that country’s subway system. It’s a great 2.5-minute clip that your students will enjoy and which will lead to class discussion about layout, location, and logistics. As  the #2 food chain in Korea,  Home Plus wanted to catch up in sales with E-Mart, but without adding more stores. The virtual  stores  on the subway platform allow customers waiting for trains to scan items with their smart phones. The products are delivered to their homes shortly after the customers  arrive themselves.

But then yesterday’s Wall Street Journal (Dec.13, 2011) followed with a story along a similar vein.  Titled “Asia Delivers For McDonald’s”, the Journal reports that in cities from Beijing to Seoul, McDonald’s and KFC have set up armies of motorbike delivery drivers carrying specially designed boxes delivering Big Macs and buckets of chicken wings. More than 1/2 of KFC’s 3,500 restaurants in China offer delivery, sometimes in just 15 minutes (with a goal of under 30 min.) for orders placed either on-line or by phone.  And more than 2,000 new KFCs will be added in China in the next decade with the service. “We will probably stop building call centers as more people buy online”, says KFC’s CFO.

“If you can’t come to us, we’ll come to you”  is  McDonald’s slogan in Asia, says the firm’s regional president. Equipping its kitchens to handle  delivery involves laying out an area for assembly. Orders are packed in battery-powered induction heating boxes and insulated coolers that both fit on the back of the yellow and red scooters. The flat delivery fee is about $1.

Discussion questions:

1. Why did the online supermarket delivery system (eg., Webvan) did not succeed in the US?

2. Why do we have more drive-throughs  in the US?

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