ECO550: Managerial Economics and Globalization
June 15, 2012
Popeye’s Restaurants According to the Popeye’s chicken restaurant website (www.popeyes.com/story, 2011), the company was founded in 1972 by Al Copeland. The first restaurant was located in Arabi, Louisiana just outside of New Orleans. The company grew relatively quickly with over 500 franchise restaurants in 1985 throughout the southern Unites States. The company relocated its headquarters to Atlanta Georgia around the time of the 1996 Olympics, and opened its first international location in Toronto Canada. It expanded and formed America’s Favorite Chicken (AFC) enterprise. Hardee’s restaurants are also part of the AFC enterprise. AFC and Popeye’s are strong holds in the fast food market, specifically in the fast food chicken product market. The market or industry in which Popeyes operates can be considered the fast food service industry. This would include any fast food companies, life McDonalds, Wendy’s or Burger King. An article by Ho and Cho (1995) describes fast food service companies as those who offer quick food and most often have a drive through window for even speedier service. While this can include all fast food service establishments that sell anywhere from hamburgers to pizza, the competition can also be narrowed down to only those which primarily sell chicken. The competition in this narrow category would then only include Bojanlges, Churches Chicken and Kentucky Fried Chicken all of which sell the same style bone-in friend chicken pieces. While Zaxbys and Chic-fil-A are also predominately poultry places these companies do not sell bone-in fried chicken. Popeye’s consistently is ranked as one of the top preferred fried chicken restaurants, especially in the new era of health conscious population (Our Company, 2002-2011).
Popeyes distinguishes itself with a unique "New Orleans" style menu. Popeyes’ menu consists mainly of a variety of mild and spicy chicken products including strips, nuggets, and breaded or un-breaded portions, with some seafood and sandwich products. Sides are offered too, such as corn on the cob, biscuits, french fries, cajun fries, mashed potatoes, and rice, and a variety of sauces, allowing customers to choose what suits their own particular diet. Those customers who are watching their weight, for example, can enjoy Popeyes’ Louisiana Legends selection as each serving has only about 170 calories. Below is a price list of some of the basic chicken products available at local Popeyes restaurant. Various coupons are routinely available which range from lower prices dinners and combos to “buy one get one free” dinners. Popeye’s only offers family meals with a coupon. Many locations also offer a variety of additional menu items not listed below which includes chicken strips, nuggets, sandwiches and wraps.
Table 1: Menu Items
2pcs chicken, biscuit and 1 side Dinner
2 pcs chicken, biscuit, 1 side and drink Como
3pcs chicken, biscuit and 1 side Dinner
3 pcs chicken, biscuit, 1 side and drink Como
Small side of French Fries, red beans and rice or Cajun rice
Medium side of French Fries, red beans and rice or Cajun rice
Individual Chicken Pieces
Popeyes serves food the world craves and is continuing to expand its global reach (www.afce.com, 2002-2011). According to the 8-K form, globally Popeyes opened 106 restaurants and permanently closed 67 restaurants, resulting in 39 net openings, compared to 14 net openings in 2009.
As of December 26, 2010, the company operated and franchised 1,977 compared to 1943 at the end of 2009. The restaurants are located in 45 states, the District of Columbia, Puerto Rico, Guam, the Cayman Islands and 26 foreign countries. Of the 1,542 domestic franchised restaurants, approximately 70% were