The format report
CONTENTS
1 executive summary 1
1.1 Burger King History 1
1.2 Burger King Production 2
1.3 Burger King International Expansion 2
1.4 Burger King Philosophy 3
2 American- style fast food restaurants in ukraine 3
3 non-economic factors favoring burger king franchizins in Ukraine 3
4 ukrainian’s domestic economy 4
4.1 Industry in Ukraine 5
4.2 Foreign trade and foreign invetments of Ukraine 7
5 recommendations 8
BIBLIOGRAPHY 10
executive summary
In this report I will research the avaliability of Burger King to expend its fast food restaurants into Ukraine. If the oppertaion will go in appropriate way - Ukraine will be one of the most countries in the world that already have Burger king restaurant points: America, Europe, Asia and Africa countries.
Unfortunately, economic of Ukraine i not on the greatest point but the demand for the fast food is still on the same point as it was last 5 years. So, on my mind it is good idea to refresh the production market in this sphere. This is the result of big popularity of fast food around young part of Ukrainians.
This report will show the possibility of Ukraine to be viable for expanding the Burger king production. This fact comes from other countries examples: Russia, Poland and Czech Republic. But it is still needed more research to be sure while doing this operation.
Burger King History
Burger King is an American chain of fast food retaurants that is spread through all over the world. Its headquarter is situated in unincorporated Miami-Dade County that is in Florida, United States. It was created in 1953. Insta-Burger King was the first its name.
After financial problems in 1954, the company was purchased by David Edgerton and James McLamore. Then it was named Burger King. The company have changed the owners four times after that. The last ones bought Burger King in 2010 for the 3.26 dollar of USA.
Burger King Production
When the last owners, 3G, purchased the Burger King company chain, the menu was restructured to moving away from the male- orientated one that was dominant while the last ownership. It was global reconstruction: over 20 new products were researched and developed. On the other hand, ones that were still the part of the menu had to be reformulated. All these changes were done till April 2012 and the included adding new ice cream products, chicken strips and smoothies. The very main product, the Whopper, was also changed: new types of cheese and packaging were added.( Mclamore, J. (2016). The Burger King.)
Burger King International Expansion
Burger King started its expansion in 1963 with forey into locations that were outside the United States, San Juan, Puerto Rico. His world famouseness it got after several years. In 1969 it opened it first restaurants in Ontarion, Canada. There are some information about countries that were taken next: in 1975 was built restaurant in Madrid, Spain and 1971 in Oceania. In the eighties of nineteenths century Burger King started spreading through the East Asian countries: Japan, Taiwan, South corea and Singapore. Due to some problems, all Japaneese BK restaurants were closed in 2001. However, not for a long time. In 2007 Burger King reentered its market operations in Japan.
In 2008 Burger King had 12,000 stores less than Mac Donalds, however he could do the longest chain of restaurant through the world. Burger King divided its international operations into three parts: The Middle East, Europe and Africa division, Asia- Pacific and Latin America and the Caribbean.
Australia is the only continent where Burger King does not operate with its own name. Through last century, from 1950s to 1990s, there were some controversies with Australian panckake company Jack Cowin. However they have made the deal and now the only one brand that provide BKs production is "Hungry Jack's".( Mouw, R. (2016). Praying at Burger King.)
Burger King Philosophy
“Every day, more than 11 million guests visit BURGER KING® restaurants around the world. And they do so because our restaurants are known for serving high-quality, great-tasting, and affordable food. Founded in 1954, BURGER KING® is the second largest fast food hamburger chain in the world. The original HOME OF THE WHOPPER®, our commitment to premium ingredients, signature recipes, and family-friendly dining experiences is what has defined our brand for more than 50 successful years.” ( Burger King, about us )
American- style fast food restaurants in ukraine
The only one American- style fast food that is already spread through Ukraine is Mac Donalds. Now there are 75 working Mac Donalds restaurants that are working on the Ukrainian territory. The most part of them are in Kyiv( 32 ), Kharkiv( 9 ), Dnipropetrovk( 8 ). So, it means that my predictions about fast food restaurant situating were more or less right. On the other hand, all of these are overcrowded all the time. And it would be nice to show the Ukrainian people something new. I am sure that the most part of people will go to the Burger King restaurants to eat and feel something new.( Palin, M. (2016). Ukraine.)
non-economic factors favoring burger king franchizins in Ukraine
When you are going to think about American- style fast food in Ukraine, you can compare it with Russia. Russia already have Mac Donalds and Burger King stores through all country. The expansion of Burger King into Russia was also in the time of financial crysis. However, it was not the problem to make a good trading market with a lot of money gain. I think there will be great potential in providing of Burger King in Ukraine despite of some anti- American thoughts.
There is an another non- economic factor that makes Burger King to be an attractive locale in Ukraine. The main sense is the presence of foreign investments. The laws allow different companies to be 100% foreign and have the possibility to reduce the bureaucracy in Ukrainian business.
ukrainian’s domestic economy
Ukraine is an industrial-agrarian country. According to CIA data, in 2011 it was the 39th economy in terms of GDP at PPP of the world, and per capita GDP was 7,600 US dollars.
After the collapse of the USSR, since 1992 in the country, there was a progressive de-industrialization, which took in the high-tech industries, and engineering total. By 1999, the GDP reached the bottom, reaching around 40% of the 1991 level. In a somewhat better position turned out to be the metallurgical, chemical and other energy-intensive industries with low added value, remain competitive in the global market due to the preferential prices for Russian energy [source not specified 181 days]. Industries that have yet to some extent work are metallurgy, energy (there are nuclear power plants and a cascade of hydro power plants on the Dnieper River), as well as chemicals and mining (coal, ore). The most economically developed regions - Donbass (Donetsk region and the Lugansk region), Dnipro (Dnipropetrovsk region and Zaporizhia region), as well as the city of Kiev, Kharkov, Odessa and Lviv.
For the economy, with its market nature, characterized by the active role of the state: it has about 140 large enterprises in various sectors of the national economy, as well as controls the prices of a number of products, including basic food and fuel and lubricants. In terms of GDP share of industrial production in 2011 is 34.4%, services - 56.2%, agriculture - 9.4%. At the same time, 18.5% of employed are in industry, in agriculture - 15.8% and in the service sector - 65.7% of the working population. The total number of working-age population - 22,090,000 people (30 in the world), the unemployment rate - 7% (81 place in the world).
Ukraine is considered to be an export-oriented country, according to some estimates, it receives due to export 50% of GDP. As for imports, in 2011, according to the WTO, Ukraine took the 25th place among the world's importers (excluding intra-EU trade) of goods with a share of the global market of 0.6%.
In 2011, Forbes put Ukraine on the 4th place in the ranking of the ten worst economies in the world. The article noted that despite the fact that Ukraine has rich farmland and mineral resources, and can become the leading European economies - its GDP per capita is far behind even countries such as Serbia and Bulgaria. The US State Department says such flaws: "Complex laws and regulations, poor corporate governance, weak implementation of the treaty by the courts of law, and especially corruption."
In 2010, Ukraine's GDP according to World Bank estimates was about 136 billion, in 2011 in US dollars - about 163 billion, in 2012 - 176.6 billion in 2013 - 177.4 billion.
In terms of national competitiveness in 2013 Ukraine was ranked 84 in the world. Due to 2014, Ukraine took the 96th place in the world ranking of ease doing business. Ukraine occupied 164th place in the ranking of world tax systems. According to the World Bank in Ukraine 28 taxes, of which one - the income tax, 24 in labor taxes. The total tax rate is 54.9%.( Aslund, A. (2016). How Ukraine Became a Market Economy and Democracy.)
Industry in Ukraine
Industrial development in Ukraine began in XVIII-XIX centuries, when there was the beginning of the processing of agricultural products. However, a deliberate industrialization program has been deployed only in the late XIX - early XX century. The most important export product in Ukraine is the production of iron and steel industry, accounting for nearly half of exports of heavy industry. The chemical industry is working in a single complex with metallurgy, using by-products of metallurgy and coke industry for the production of nitrogen fertilizers, varnishes, paints, medicines. Phosphorite, potassium salts and table salt are used for the production of mineral fertilizers, sulfur - for production of sulfuric acid. Oil and gas - both local and imported - are used for the production of synthetic rubber and synthetic fibers.
In Ukraine there are more than 40 industries and enterprises. The food industry is one of the leading industries of Ukraine. It is second only to iron and steel industry, giving more than 17% of industrial production in Ukraine. The food industry has a complex structure, bringing together more than 20 industries producing food. Primary among them are sugar, flour millers, but cereal, oil and fat, baking, alcohol, canning, fish, dairy, meat, wine, confectionery, brewing, tobacco and others. The food industry is closely related to agriculture, which is the main supplier of raw materials for it. It is not surprising that the spatial organization of the food industry is largely determined by the characteristics of agricultural specialization. The decisive role in the distribution of the enterprises food industry play a raw material and the consumer. Those who use little transportable commodity (perishable) or greater kilkost raw materials tend to it (sugar, oil, fish, canning, vegetable oil, etc.). The industries in which the cost of transporting the finished product more than the transportation of raw materials, consumer orituyutsya (confectionery, bakery, brewery, dairy, etc.). And for raw materials and consumer oriented meat, mukaMelno cereal, tobacco and other industries. The range of produced products includes more than 3000 titles. Food industry companies are located everywhere, although their placement is taken into account the specifics of the industry. In recent years, an increasing number of food enterprises. They are near the sources of raw materials, and in the collective farms.
Has increased the competitiveness of Ukrainian products on the domestic and foreign markets. Almost 95% of food products that are providing in the domestic market, are the products of domestic production. Food products are exported to more than 40 countries. This industry takes 1st place for foreign investment influences. For industry it is about US $ 0.9 billion. (2007), representing 19% of all foreign investments in the Ukrainian economy. Among the main priorities of the state policy in the sphere of food industry it is - to create favorable conditions for enhancing the innovative development of the industry, the acceleration of the modernization of its material and technical base, introduction of modern technologies and the widespread use of modern scientific research.( FOOD & BEVERAGE INDUSTRY: Basic Principles of Legal Regulation in Ukraine.)
Chart1: Comparsion of market companies during 2013-2014
Foreign trade and foreign invetments of Ukraine
The volume of foreign trade in 2011 amounted to 140.3 billion US dollars with a negative balance of $ 13.7 billion in exports -.. $ 63.3 billion, imports -. US $ 77.0 billion (imports -. 38th , export - 51 th place in the world).
The main exports are electrical equipment, textiles, wood, plywood. According to the World Bank in 2012, the country ranked eighth in the world in the export of wheat (4.1 million tons). Ukaraine imported mainly energy, machinery and equipment, chemical products and oil.
The main consumers of Ukrainian exports are Russia (18.2% of the total), Turkey (6.6%), Egypt (5.3%), China (5.0%), Poland (4 ,9 %); the main importers of Ukrainian - Russian (23.3%), China (10.0%), Germany (9.9%), Lithuania (7.3%), Poland (5.6%).
The volume of direct foreign investments in the Ukrainian economy in 2011 is approximately $ 60.5 billion. (52 place in the world). Ukrainian investors abroad placed more than $ 3 billion. (65 place in the world).( Ukraine Export-import, Trade and Business Directory.)
recommendations
This report great possibilities for expansion of Burger King to Ukraine.
Second fact for great expansion is Russia example. Named country has developed Burger King company’s chain while had financial problems in their economy.
Burger King should do its own research about expansion into Ukraine for not making bad mistakes.
Burger King should actively compete with McDonalds to do great market gains.
It is recommended for BK to contact with nearby Burger King expanded countries. So, it would be easy to export the products that are needed and it will make the economy of Ukraine more strong somehow.
One more advice is include the cities, where BK should open restaurants at first. These are Kyiv (because it is a capital), Lviv (it is a cultural center of Ukraine), Dnipropetrovsk (it is the industry center of Ukraine).
The last one recommendation is going to Ukraine. This country should stabilize the economy and financial situation somehow. Otherwise it would be very hard to do expansion operation of Burger King.
After naming this recommendations I can say with certainty that expanding of Burger King to Ukraine is more than possible.
BIBLIOGRAPHY
Aslund, A. (2016). How Ukraine Became a Market Economy and Democracy. Google Books. Retrieved 26 February 2016, from https://books.google.fi/books?id=C8C3xuqd6aMC&printsec=frontcover&dq=Ukraine+economy&hl=fi&sa=X&ved=0ahUKEwjh3qORy5bLAhWkAJoKHfd1BiQQ6AEIJTAA#v=onepage&q=Ukraine%20economy&f=false
BURGER KINGВ®,. (2016). BURGER KINGВ® About Us - Great Food Comes First. Retrieved 26 February 2016, from http://www.bk.com/about-bk
Google Books,. (2016). FOOD & BEVERAGE INDUSTRY: Basic Principles of Legal Regulation in Ukraine. Retrieved 26 February 2016, from https://books.google.fi/books?id=du5tBgAAQBAJ&pg=PT4&dq=Ukraine+industry&hl=fi&sa=X&ved=0ahUKEwiy3KuXy5bLAhWMCJoKHS4YCOcQ6AEIITAB#v=onepage&q=Ukraine%20industry&f=false
Google Books,. (2016). Ukraine Export-import, Trade and Business Directory. Retrieved 26 February 2016, from https://books.google.fi/books?id=ua-HjWnxx7wC&pg=PA63&dq=Ukraine+import&hl=fi&sa=X&ved=0ahUKEwikhcmny5bLAhUCMZoKHa-tAFsQ6AEIGTAA#v=onepage&q=Ukraine%20import&f=false
Mclamore, J. (2016). The Burger King. Google Books. Retrieved 26 February 2016, from https://books.google.fi/books?id=7hR2QgAACAAJ&dq=burger+king&hl=fi&sa=X&sqi=2&ved=0ahUKEwjEwcXnypbLAhXBJ5oKHYR3DqcQ6AEIRjAG
Mouw, R. (2016). Praying at Burger King. Google Books. Retrieved 26 February 2016, from https://books.google.fi/books?id=FR2huvkc6gcC&printsec=frontcover&dq=burger+king&hl=fi&sa=X&redir_esc=y#v=onepage&q=burger%20king&f=false
Palin, M. (2016). Ukraine. Google Books. Retrieved 26 February 2016, from https://books.google.fi/books?id=sxRtNoL-E3cC&pg=PA86&dq=ukraine+fast+food&hl=fi&sa=X&ved=0ahUKEwib8ru_ypbLAhXnO5oKHbFTAqQQ6AEIGjAA#v=onepage&q=ukraine%20fast%20food&f=false
