As a top-rated blog addressing global developments in supply chain management and technology, we have often highlighted incidents of supply chain disruption. Such developments have included natural disasters, product supply shortfalls, internal business process breakdowns and others. This week, however, we were taken back with a disruption event occurring across the United Kingdom.
Reports indicate that fast-food chain Kentucky Fried Chicken was forced to temporarily close most of its UK outlets after widespread shortages of chicken product occurred. Upwards of 550 outlets were impacted, forcing British media to coin the headline, “KFC Crisis” and some consumers to actually call their local emergency services office to complain of a chicken food shortage.
According to local published reports, the fast-food chain has blamed the current shortage squarely in the laps of global logistics provider DHL, which recently took-on the new food replenishment delivery contract from a previous UK-based specialty food logistics provider. DHL had announced last November that it would assume the supply and distribution of food products, along with other restaurant items for KFC outlets across the UK when the former contract expired on February 13. Compounding this crisis are indications that upwards of 95 percent of UK outlets are run by franchisees.
Apparently, the shortage is noted as so severe, that KFC is reluctant to indicate when restaurant operations will return to normalcy. Instead, there are statements that both KFC and DHL teams are working diligently to resolve the crisis with some outlets expected to have chicken supply this week.
KFC originally tried to make light of the problem, but that seemed to backfire in that some British consumers take their fried chicken experiences rather seriously. For its part, DHL has apologized for the “inconvenience and disappointment caused to KFC and their customers.”
As with all such incidents, a lot of learning will be garnered regarding successfully changing a key logistics and product replenishment provider. With restaurant franchisees as key stakeholder to the changeover decision,that learning will obviously include the monetary implications of the changeover, as compared to the original contract costs.
Once again, in the end, logistics and supply chain capabilities do matter in customer fulfillment.
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