Under $1 Billion Expansion Plan, Chick-fil-A Will Open Abroad by 2026
Chick-fil-A Inc. is betting $1 billion that its crispy chicken sandwiches will be as enticing to Asians and Europeans as it is to North Americans. The company aims to have restaurants up and running on those continents by 2026 and to place restaurants in five global markets by 2030, according to a report in The Wall Street Journal. During a Journal interview, CEO Andrew Cathy said the family-owned company still has room for growth in the United States but wants to flex its potential worldwide. “We feel like it’s time to continue to innovate and try and test how we will do in international markets so that we can learn,” said Cathy, the fast-food franchise’s third-generation CEO.
Chick-fil-A’s Chicken Sandwich
Chick-fil-A’s signature dish, the fried chicken breast sandwich, along with its use of high-quality ingredients, has helped the Atlanta-based franchise become the third-largest U.S. fast-food chain in terms of sales, according to research firm Technomic. It lags only McDonald’s and Starbucks.
That success has given rise to imitators, of course, including chicken sandwiches on menus at Popeyes Louisiana Kitchen, McDonald’s and Burger King. Research firm Circana Group, cited by The Journal, said Americans ordered 2.8 billion breaded chicken sandwiches in the 12 months ended in January of this year, a 21% increase over the same period three years ago.
Overseas Business Model, Sites and Menus
Cathy told The Journal that Chick-fil-A hasn’t set a target number for overseas restaurants, although he said the company will stay the course with its business model. Translation: Franchisees will be allowed to own just a single restaurant and will share profits with the parent corporation after paying fees. Ideal markets for Chick-fil-A are Asian and European nations with stable economies and large populations with an appetite for chicken. The new foreign-based restaurants will have chicken sandwiches, waffle fries and milkshakes on their menus, along with a few dishes that give a nod to local taste preferences.
Income Expectations for Chick-fil-A in Asia, Europe
Chick-fil-A leadership anticipates the Asian and European location will equal the performance of their 2,700 American counterparts, which posted an average of $6.3 million in sales per franchise in 2021, according to Technomic research. That’s about quadruple the average for major competitors Popeyes and KFC domestically, the firm said.
Chick-fil-A’s main challenger in Asia will be KFC. Asian fast-food chicken sales were about $33 billion in 2022, and KFC is entrenched with 39% of the market, according to The Journal. KFC also sits at the top of Western Europe’s $6.1 billion fast-food chicken market.
Past Chick-fil-A Expansion Efforts Outside U.S.
Founded in 1967 by Truett Cathy, Chick-fil-A has tried to gain a toehold overseas in the past. The company launched in South Africa in 1996 but folded the venture in 2001 after struggling with brand awareness, The Journal stated. In 2019 Chick-fil-A opened its first Canada restaurant, in Toronto; it now has eight sites in Canada and three in Puerto Rico.
A U.K. location west of London opened in 2019 and quickly drew criticism from gay-rights advocates there. It shut down after several months. Activists and some customers have criticized past statements by former Chick-fil-A CEO Dan Cathy as anti-gay.