KFC franchise restaurants launch in China’s Sinopec and CNPC stations

Yum China Holdings announced today the opening of its first franchised petrol station restaurants of American fast-food brand, KFC, in collaboration with both China Petrochemical Corporation (“Sinopec”) and China National Petroleum Corporation (“CNPC”). These openings follow an announcement made at Yum China’s Investor Day in March 2019 declaring that Yum China would develop franchised restaurants at Sinopec and CNPC petrol stations across China.

On December 17, 2019, the first franchised KFC restaurant since signing the cooperation agreement was opened in a CNPC petrol station in Kunming, Yunnan Province. Meanwhile, in Dalian, Liaoning Province, the first KFC franchised restaurant in a Sinopec petrol station is set to open its doors on December 23, 2019.

At present, Sinopec and CNPC collectively operate over 50,000 petrol stations in China, of which more than 30,000 belong to Sinopec and more than 20,000 belong to CNPC.

The partnership with both companies will enable Yum China to accelerate the expansion of its portfolio of brands into a previously underserved segment of the market, specifically petrol stations and highway service areas across the country.

Under the cooperation agreements, Yum China has a robust store development pipeline with a target to open over 100 stores over three years, using a variety of different models.

“We are delighted that within a year, our collaborations with Sinopec and CNPC are already starting to bear fruit. The first franchised petrol station restaurants represent an important milestone in our long-term strategic partnership with both companies.” said Joey Wat, CEO of Yum China.

“Together with Sinopec and CNPC, we are committed to building a successful business model and creating innovation-driven growth together.”

These openings come after a pilot franchised KFC restaurant opened in October 2018 at a CNPC petrol station located in Tangshan, Hebei Province. After only a few months, the pilot restaurant was thriving as a result of the synergies achieved by combining the unique location of petrol stations with Yum China’s operating management expertise.

According to the agreement, KFC has become CNPC’s only Western quick-service restaurant franchise partner in its petrol station channel.

As vehicle ownership continues to grow, petrol stations and highway service areas provide Yum China with an enormous opportunity to offer consumers better catering products, services and experiences, as well as contribute to the upgrading of petrol stations and highway service areas throughout China.

Yum China will also work with Sinopec and CNPC to explore additional opportunities to collaborate in other fields that can bring more convenient and innovative experiences to consumers across China.

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