FCK indeed… A lesson to be learned from chicken
KFC’s woes have been well documented over the past weeks, with the closure of up to 420 stores nationwide, costing millions in lost sales. And that’s not to mention the brand damage. YouGov BrandIndex has shown its buzz ranking has crashed from -0.9 to -20.1. And competitors have been capitalising on it, with some clever targeted advertising campaigns of their own.
The cause of the debacle sounds almost too farcical to be true – they ran out of chicken.
But there is a bigger lesson in this - being the cheapest does not equal being the best.
Despite several warnings, in February 2018 KFC chose to replace their long-term distributor Bidvest Logistics with a cheaper alternative DHL. They promised a “greater focus on innovation, quality and service performance” and to “provide a faster turnaround of orders.” This is despite the well documented issues Burger King had with the same supplier only six years ago. Again, a firm was intent on cutting costs, but instead ended up cutting quality, culminating in costly distribution shortages. It resulted in Burger King begging Bidvest Logistics to take the contract back.
The cause of the issue is still debated, but many claim that switching from a six warehouse distribution model, to a single depot run by DHL was always destined for trouble. GMB Union had warned KFC about the Rugby-based distribution centre – unscalable and endemic with operational challenges. Already, GMB is urging KFC to return to the original supplier Bidvest, who would be able to salvage the situation quickly. Conversely, it is thought that DHL could take weeks, even months to recover from this. A risk KFC can’t afford to take, with franchisees increasingly incensed at the loss of business and the inability to resolve the situation themselves, which would constitute a contractual breach. It is a logistical nightmare for KFC that requires a rapid response.
As a specialist provider of agile, skilled resourcing solutions, we are accustomed to working in a competitive environment where many suppliers are offering ‘similar’ services to those of BrightPool, and sometimes at a reduced rate. Too good to be true? We think so.
Recruitment is a costly process. Inefficient resourcing solutions lead to common issues:
- Poor quality candidates
- High levels of attrition
- Poor compliance vetting
- Backfilling and re-training requirements
- Low productivity
- Low team morale
And that’s not to mention the significant time Management need to dedicate to the process – both upstream hiring and downstream replacement. Or the brand damage; word travels fast and a poor experience through the hiring process certainly impacts the choices candidates make in a competitive marketplace.
The time and effort spent on exiting old candidates, while onboarding and training the replacement candidate result in reduced overall productivity, as well as additional costs and operational burden. Investing in the right suppliers and partners is fundamental to the success of the business.
That’s why we continuously invest in the service we provide to our clients. We foster true, longstanding partnerships and are deemed as market leaders in our arena. We consistently benchmark our rates to ensure that while remaining competitive, we do not compromise our quality of service.
How do we do it?
Through a proven methodology, we work in partnership with our clients to understand their key resourcing challenges, their recruitment pipelines and the specifics of their resource requirements. We implement a multi-tiered sourcing, screening and assessment process to ensure that our candidates are an exact skills match for the roles in question.
Click here to find out more about our methodology.
And the results of our investment?
- High conversions - over 80% interview to offer ratio
- High retention rates
- Fully compliant candidates – prior to onboarding
- High speed of resource mobilisation – sourced, screened and vetted within 2-3 weeks
- Large network of engaged and loyal candidates
- Frequent repeat business and client referrals
Without making the necessary investments in service provision, suppliers inevitably cut corners to ensure they maintain profitability. Sacrificed quality of service brings with itself rather significant repair costs - a lesson KFC have learnt only too well.