Yum! Brands to open 150 shops in Suning Appliance retail outlets

11 May 2012 (Last Updated May 11th, 2012 07:00)

Yum! Brands, a US-based firm which operates or licenses food joints such as Taco Bell, KFC and Pizza Hut, plans to open KFC and Pizza Hut restaurants inside stores operated by Chinese retailer Suning Appliance.

Yum! Brands, a US-based firm which operates or licenses food joints such as Taco Bell, KFC and Pizza Hut, plans to open KFC and Pizza Hut restaurants inside stores operated by Chinese retailer Suning Appliance.

As per the deal, Yum! Brands will set up 150 restaurants in the next five years in retail outlets run by the electrical appliance retailer in China, reported China Daily.

The Suning Appliance stores will house KFC, Pizza Hut, Little Sheep and East Dawning brand restaurants.

Yum China Division president and chief operating officer Mark Chu said the company highly values the cooperation with Suning.

"The cooperation can give full play for both parties on business arrangement, chain store management, brand influence, as well as better meeting customers' needs," Chu said.

Yum! Brands has opened trial KFC and Pizza Hut restaurants in Suning stores in 17 Chinese cities, including Beijing, Dalian, Nanjing, Shanghai and Shenyang.

The Louisville-based firm currently operates more than 5,000 restaurants in China and aims to set up at least 600 restaurants a year in the near future.

Nanjing-based Suning Appliance, which now has more than 1,700 stores in the country and abroad, aims to open more than 400 retail outlets in 2012.

The home appliance giant has plans to move into other sorts of business, such as online sales, besides adding to its stock of traditional stores.

Suning Appliance chairman Zhang Jindong said the value of sales in China's home appliance market will grow to CNY3.1 trillion ($475bn) by 2020.

"Suning intends to occupy about 20 percent of China's home appliance market by then," Jindong said.

"For that time, our target for online sales is 300 billion yuan, while our target for online sales for this year is 30 billion yuan."

"In the current situation for retail, this cooperation between the two retailing giants will lower the cost of opening stores and drum up more customers for both sides, which will lead to more innovation in the industry,"

China Chain Store and Franchise Association deputy secretary-general Yang Qingsong said: "In the current situation for retail, this cooperation between the two retailing giants will lower the cost of opening stores and drum up more customers for both sides, which will lead to more innovation in the industry."