AKFCF Spring 2021

QUARTERLY

Association of Kentucky Fried Chicken Franchisees, Inc.

2021 AKFCF Convention First-ever virtual event was a success!

PLUS: Power of the People | Shining Stars | Service Awards

Spring 2021

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CONTENTS

AKFCF QUARTERLY SPRING 2021

2021 Convention Wrap-Up

36

20 FEATURES GAC Report: New Administration’s Priorities 16

By Amy Agenbroad 2021 is off to a busy start on Capitol Hill in more ways than one and isn’t expected to slow down anytime soon!

Convention Wrap-Up 20 2021

By Kelly Rodenberg and Cory Sekine-Pettite The AKFCF Virtual Convention kicked off to “Good Vibes” on March 2 with a traditional “fireside chat” between AKFCF President, Brandon Robertson, and KFCC President, Kevin Hochman. They sat down in Louisville to discuss the week’s highlights and provided members with basic instructions on how best to participate virtually.

of the People 36 Power

By Kelly Rodenberg Please meet three more talented people who contribute their time and efforts to making KFC a better brand.

Shining Stars 40 2020-2021

By Cory Sekine-Pettite Every year, the AKFCF makes an effort to acknowledge individuals who exceed expectations in the volunteer work they do for our franchisee family.

Read this year’s stories.

2021 Franchisee Service Awards 44 KFC

By Cory Sekine-Pettite The AKFCF’s Service Awards honor those franchisees who have served their communities for 40-plus years. Read brief profiles of some of these franchisees and learn their secrets to success.

40 DEPARTMENTS 4 From the Editor 6 President’s Report 10 NCAC Report 12 In the News 52 Regional Shorts 54 Finance Committee Report 55 Education Committee Report 56 KFC Foundation 58 RSCS Member Programs 60 Executive Director Update 62 Legal Update By Ron Gardner 64 Looking Back

On the Cover: The first-ever AKFCF Virtual Convention was an amazing success! We truly hope that you found the experience engaging and enjoyable. We could never duplicate the energy of a live convention online, but we did our best to bring you a great show despite the difficult circumstances we’ve all encountered in 2020.

2 AKFCF Quarterly Spring 2021

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FROM THE EDITOR

QUARTERLY Official Publication of the Association of Kentucky Fried Chicken Franchisees AKFCF QUARTERLY MISSION STATEMENT

CHANGE

By Michelle Hunt

S

pringtime always signals change and regrowth. There has been a lot of change over the past year, and honestly, at this point last year, none of us could imagine how 2020 would play out. Leaving a very positive and fun-filled 2020 Convention, little did we know what last spring would bring.

Thankfully, for a good many of us, the year turned out resoundingly better than anticipated. I know now that I will never take our drive-thrus for granted, and while I was an occasional click-and-collect user, I am so thankful for the many digital options we have available to us now. I headed into 2021 with updated digital skills, many new apps, and as of March, an additional hat to wear.

I recently accepted the newly created Administrative Manager role for the AKFCF and have been shadowing the great Deb Newton. When Deb partially retires this summer to the AKFCF Trade Show Manager position, I will fully move into the administrative manager role. Now, believe me when I say that it will make my job as editor of this publication easier and doesn’t take away from my role as partner in our 16-restaurant organization here in Iowa. I’ve always loved being busy, and I love this business and our franchisee organization. I look forward to serving our members for many years to come.

This year also marked a new adventure for the AKFCF, putting together our first (and hopefully ONLY) Virtual AKFCF Convention. While the technology was incredible, and it was fun to interact with our fellow members online, it just wasn’t the same. So, while I want to say great job to the Convention Committee and Chip Booth Productions, let’s not do that again. I’m looking forward to getting back on the road and seeing our KFC family in person at both the regional and national levels. Take a look at the recap of the 2021 Virtual AKFCF Convention beginning on page 20.

There also is a ton of recognition in this issue! You’ll not only see awards presented “at” the Convention (see page 20), but also those presented throughout the past year (see AKFCF Shining Stars, page 40), as well as KFCC Service Award recognition for our family members with 40+ years of service (see page 44). Last but certainly not least, check out the latest installment of the Power of the People series beginning on page 36.

We also have some great columns and our regular GAC feature article from our lobbying firm, Polaris.

Here’s to a much better 2021 and seeing each other in person at our next AKFCF Convention in March of 2022 at the beautiful Gaylord Palms in Orlando, Florida.

Warmest Regards,

4 AKFCF Quarterly Spring 2021

The AKFCF Quarterly is the voice of today’s franchisee family and supports the mission of the Association of Kentucky Fried Chicken Franchisees, Inc.

AKFCF EDITORIAL TEAM

AKFCF President

Editor

Assistant Editor AKFCF Administrative

Director Communications Chair

Executive Director

Past President

Brandon Robertson Michelle Hunt Julie Mantlo Debbie Newton Kevin Schlutz Kelly Rodenberg Jim McKenzie

The AKFCF Quarterly (ISSN 1071-9873) is published by the Association of Kentucky Fried Chicken Franchisees for its members and their friends. AKFCF is the independent Association of Kentucky Fried Chicken Franchisees.

FRANCHISEE EDITORS:

Michelle Hunt 14812 N Avenue, Columbus Junction, IA 52738 Phone: (319) 728-3282 Fax: (319) 728-2940 michelle.hunt@akfcf.com Julie Mantlo 855 Lovers Lane, Suite 111, Bowling Green, KY 42103 Phone: (270) 783-8880 julie@rogmancorp.com Zaira Guevara (International Liaison) 7750 NW 46TH Street PTY 1495 Doral, FL 33166 Phone: (305) 384-4242 (U.S.) (011) 506 2208-7828 (Direct) zguevara@caribla.com

Copyright ©2021 AKFCF, Inc. All rights reserved. Articles may be quoted with credit to the source. Information in the AKFCF Quarterly (ISSN 1071-9873) represents the views of the authors and unless noted otherwise does not necessarily reflect the policies or position of AKFCF, Inc. Acceptance of paid advertising does not imply endorsement by the Association, or approval of the advertiser or its product or service by KFC Corporation.

AKFCF ADVERTISING AND EDITORIAL SUPPORT OFFICE

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FROM THE PRESIDENT

THE ‘POWER OF THE PEOPLE’ IS TRULY RELEVANT

By Brandon Robertson

I

wish I could tell you all how wonderful it was to see you at the 2021 AKFCF “Power of the People” Convention, but for the first time ever, we had a virtual show. However, I am incredibly happy that you got to see the information and learn what is going on in KFC through the virtual format. I was extremely impressed with the quality of the show our team put together for you. I must give huge thanks to Kelly, Chip, Josh, Christina, Debbie, and all our presenters for the work that was done to pull the show together in such a short period of time.

Kevin and his team were awesome to work with at the YUM! Restaurant Support Center in Louisville, and we could not have been happier with our experience there. I also want to thank each you for attending and participating in the Convention; none of this happens without your support and attendance.

I don’t know about you, but I am tired of talking about the “first time ever” things (there have been way too many) and I am ready to get back to the way we used to operate. It appears that we might be only a few short months away from being able to travel again, and I assure you that the AKFCF plans to make the most out of those opportunities as they develop.

Many thanks to Emma Horn and Justin Stewart for their work in organizing the wine tasting fundraiser. The Omega Winery was a great choice by Justin, and the fundraiser was off-the-charts successful. We hit our goal of $100,000 this year, which is four times the amount raised last year. The after-auction trading was key to getting us over our goal and Emma made it happen.

Thank you, Emma, for your leadership of the KFC Foundation and the work it does; it is so important to our teams!

The “Power of the People” theme turned out to be truly relevant for 2020/2021.

The plans for that as a theme started over four years ago, long before any thought of a pandemic. I think it is utterly amazing what our KFC family has done during this time. How we overcame our fears, kept our businesses thriving, and kept our family safe is astounding, and you should all be proud of what we have accomplished. As you saw during the Convention, we have extremely talented leadership in KFCC. The people that lead this brand are some of the best and you only got to see a small portion 0f them during the show. There are so many other employees of KFCC, employees of

I think it is utterly amazing what our KFC family has done during this time. How we overcame our fears, kept our businesses thriving, and kept our family safe is astounding, and you should all be proud of what we have accomplished.

6 AKFCF Quarterly Spring 2021

the RSCS, board members and staff of the NCAC, board members and executive committee members of the AKFCF and its six regions that you did not get to hear from.

It has taken 70-plus years to build what we get to enjoy at KFC, and we must work hard to make sure that 70 years from now others can say even greater things about our family.

During my opening remarks in the Convention, I spoke about how we have built our association on the backs of great leaders. It is up to us to make sure that our future leaders continue the tradition of volunteering their time to keep the trend moving forward. I asked you to think about who would run the AKFCF after you. I ask myself that question all the time. We need to make sure that our new members and new employees of members have a path to becoming involved in the AKFCF, and that usually starts in your regional meetings.

Look for new faces that are attending meetings when we get back together, make sure they feel welcome in your social groups, and offer to help them learn what the AKFCF is all about. I remember walking into my first board meeting 14 years ago and not knowing but one person in the entire room. It’s intimidating to say the least, but the people of KFC are remarkable and by the end of that meeting I had several new friends. The opportunity to learn from new people and to teach something is all around us when we get together in our regional and national meetings. So take advantage of those opportunities! I look forward to seeing you all very soon! n

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NCAC REPORT

WE ARE SET UP FOR SUCCESS IN 2021

By Tom Broome, NCAC Vice Chair

C

oming off the AKFCF Convention, I realize what a fabulous time it is to be a part of our brand! We have had a heck of a ride this past year, and 2021 promises to be interesting as well.

I would like to begin by congratulating and thanking the KFCC leadership team and all their staff for the work that took place in 2020, helping us have one of the best (if not the best) year we have ever had.

Andrea and her marketing team, with the help of our Marketing Sub-Committee, adjusted our plans as necessary to advertise at levels that would keep our momentum going, while minimizing our spending. This created a “war chest” of funds to use when we need them the most — as consumers get back to “normal” life. As mobility increases, we will have the funds to compete effectively against what is surely going to be the most competitive marketing environment we have seen in years.

Our NCAC has been very active this year, with the sub-committee work intensifying as we worked through the daily COVID-19 challenges and worked to build this year’s calendar.

10 AKFCF Quarterly Spring 2021

By the time you read this, we will be well into launching our new Chicken Sandwich.

As it rolls out across the country, we are seeing daily units match and exceed what we saw in test market. We are expecting to help build our business with many new consumers, adding both sales and profits. Our marketing budget will allow us to keep high-end media strong during this launch, ensuring we have both layers of our business growing. I would like to thank the entire KFCC team for developing, testing, and preparing to launch this great, new sandwich — all during the early days of the pandemic.

To keep our momentum going, we also will be introducing a new chicken tender, one that is larger and more consistent in size. This does not come without concern from some of you, as we will be eliminating Popcorn Chicken and begin cutting tenders for Bowls. There were more than 130 franchisee restaurants in this test, and not one of the RGMs would

have chosen to keep Popcorn. Cutting tenders keeps efficiency high, meaning we will sell a better-quality product, and it eliminates a SKU from our line-up. The VOC in test restaurants was overwhelmingly positive, and specifically on Bowls with cut tenders, feedback was great.

Launching this chicken tender, along with our new sandwich, will give us the one-two punch we need as we move to reach our potential in off-the-bone chicken.

As you might imagine, these plans did not come about suddenly, or without great thought and testing. Our NCAC has been very active this year, with the sub-committee work intensifying as we worked through the daily COVID-19 challenges and worked to build this year’s calendar. Some of the committees were meeting weekly to review KFC plans and to give input on everything from launching $30 Fill Up, to how to operate our restaurants entirely through the drive thru.

No one had ever experienced anything like what we all have been faced with, and we, as a team, worked on behalf of the system and the KFC brand.

There are so many people to thank, but I can tell you that Cynthia Koplos and her team at the NCAC office were critical in setting up proper communication with the different committees and the system. Cynthia, along with Holly Goode, Denise Medlock, Emily Gaddie, and Ron Gardner were all-in on doing whatever it took to make sure franchisees had everything they needed to weather the storm.

And here we are, a year later, with the KFC family having a stronger bond than ever before. That is what sets us up for success in 2021 and the many years to come. Thank you all for your support. n

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HOSPITALITY & SPECIALTY COMMUNICATIONS

In the NEWS

YUM! ACQUIRES KVANTUM’S LEADING ARTIFICIAL INTELLIGENCE-BASED CONSUMER INSIGHTS AND MARKETING PERFORMANCE ANALYTICS BUSINESS

I

n early March, Yum! announced it was acquiring the leading artificial intelligence-based consumer insights and marketing performance analytics business of Kvantum, Inc. With the acquisition, Yum! and its KFC, Pizza Hut, Taco Bell, and The Habit Burger Grill brands enhance their ability to apply powerful consumer insights and data analytics to drive calendar and marketing spend optimization.

Founded in 2012, Kvantum develops and deploys algorithms and artificial intelligence models to help brands understand consumer behavior. The business combines machine learning and econometric modeling into its Marketing Performance Analytics Platform in a seamless manner. Kvantum’s proprietary

technology can measure the effects of marketing tactics in a designated geography across owned, paid, and earned channels. Kvantum uses the latest modern marketing principles to tailor its services and technologies to support Yum!’s brands in several international markets.

“Technology strategies that elevate the customer and employee experience and lead to smart, data-driven marketing decisions are critical to keeping our brands R.E.D. (relevant, easy to access and distinctive) and delivering growth for our franchisees and shareholders,” said David Gibbs, CEO, Yum! Brands. “We’re excited about the opportunity this acquisition presents and the potential to scale Kvantum’s

proven technologies across our system to strengthen our data and advanced analytics capabilities and elevate our world-class marketing competencies globally.”

Yum! Brands plans to combine Kvantum’s artificial intelligence and machine learning approach to understanding human behavior with the unique skillsets of the anthropologists and sociologists at Collider Lab, a culture-based consumer insights and marketing strategy consultancy Yum! acquired in 2015. Yum! Brands believes that Kvantum’s and Collider Lab’s combined methodologies will yield even deeper consumer and brand insights and help advance the Company’s R.E.D. Marketing strategies around the world.

Source: Yum!

KFC SINGAPORE OFFERS HUNDREDS OF KFC UK NEW SPIN ON THE ZINGER KITCHENS PRIMED FOR is offering a new twist on its Signature Zinger sandDELIVERY EXPANSION KFCwichSingapore with the introduction of the new Mac ‘N Cheese Zingerito at participating locations.

The Mac ‘N Cheese Zingerito features a hot and spicy Zinger fillet and turkey bacon, wrapped in a 10-inch soft flour tortilla with shredded mozzarella and cheddar cheese, a dollop of mayonnaise, and creamy mac ‘n cheese.

As far as pricing goes, the Mac ‘N Cheese Zingerito is available a la carte for $5.90 (USD $4.40), or as part of a meal, served with a medium fries and regular soda for the discounted price of $7.95 (USD $5.91).

Source: KFC Singapore

12 AKFCF Quarterly Spring 2021

K

FC is set to massively ramp up its delivery capabilities in the UK market as part of a multi-year deal involving hundreds of sites.

KFC UK has agreed to extend its partnership with Deliveroo by up to 200 restaurants this year. The partnership builds on the 130 restaurants that KFC launched through the platform over the past 12 months.

As a result of the expansion, KFC will be available through Deliveroo in a further 100 towns and cities in the UK, giving four million more people access to its food in as little as under 30 minutes.

Stephen Goldstein, EVP restaurants at Deliveroo, said: “We are extremely proud that, at this critical moment in KFC’s growth trajectory, they have chosen to expand with Deliveroo. The expansion means that even more fans of KFC can now enjoy their legendary food from the comfort of home.”

To mark the arrangement, KFC and Deliveroo are re-running their highly successful 20% discount offer on ‘Wings Wednesday,’ which is available to order from all restaurants via the Deliveroo platform.

Additional special discounts on favorite menu items will be introduced throughout the year.

Source: Foodservice Equipment

KFC, TACO BELL, PIZZA HUT TO START TAKING ORDERS VIA TEXT Yum! announced in March that it acquired Tictuk Technologies, a leading Israeli omnichannel ordering and marketing platform company. The addition of Tictuk gives Yum! the ability to offer more ways for consumers to access and order its KFC, Pizza Hut, Taco Bell, and The Habit Burger Grill brands through some of the world’s most popular social media and conversational platforms.

Founded in 2016, Tictuk is a privately held company based in Tel Aviv, Israel, that specializes in conversational commerce, a technology solution that allows users to complete orders and interact with brands through a variety of social media and chat channels, including WhatsApp, Facebook Messenger, Telegram, SMS, QR codes, and email. Tictuk’s online ordering and marketing platform also leverages a hybrid of chat, web, advertisements, and

intelligent marketing technology to engage with consumers. The technology seamlessly integrates with POS and existing payment systems and works for all types of customer engagement including delivery, curbside pick-up and in-restaurant dining.

“As we navigate a consumer landscape reshaped by the events of 2020, we continue to intensify our focus on leveraging our scale and reinforcing our growth model with investments in digital and technologies to enhance the customer and employee experience, strengthen restaurant unit economics, and enable our brands and franchisees to compete and win in a rapidly changing world,” said David Gibbs, CEO, Yum! Brands.

In 2020, Yum! Brands’ digital sales hit a record of $17 billion, about a 45-percent increase over the prior year, a testament to its focus on pivoting to win in an off-premise environment and meeting new consumer needs.

Yum! Brands’ global technology strategy, in partnership with the KFC, Pizza Hut, Taco Bell, and The Habit Burger Grill divisions, is focused on providing a best-in-class digital journey across mobile, online, delivery, and restaurant operations. Yum! continues to accelerate its digital commerce strategy through data and advanced analytics and innovative emerging technologies to unlock new sources of global growth.

“The right technologies will allow us to better serve customers with the best offer and delicious food in a way that’s most convenient for them,” said Chris Turner, CFO, Yum! Brands. “We’re excited about the opportunity Tictuk presents, as their solution delivers high impact by enabling our brands to achieve a truly omnichannel presence and provide frictionless ordering for customers in just a few clicks.”

Source: Yum!

Spring 2021 AKFCF Quarterly 13

In the NEWS

KFC MARKS MILESTONE 25,000TH RESTAURANT WITH AN ALL-WOMEN TEAM

L

ocated in Hyderabad, India, the restaurant signals KFC’s continued momentum in global expansion.

KFC is celebrating the milestone opening of its 25,000th restaurant around the world. The restaurant, located in the city of Hyderabad in southern India, is a testament to KFC’s undeterred speed of unit growth, the company reports. The new restaurant is led and operated by an all-women team, reflecting the brand’s global commitment to championing a culture of equity, inclusion, and belonging as it expands across the globe.

Now with over 25,000 restaurants across 145+ countries, KFC opens a new restaurant every six hours. With two thirds of the world’s KFCs yet to be built, this landmark restaurant highlights just how long the brand’s runway for growth remains. “This is an incredible milestone on our KFC global growth journey,” said KFC Global Chief Development Officer Dyke Shipp. “We’re extremely excited

to have opened our 25,000th KFC and to be growing our footprint across India and the world. The fact that this restaurant is powered by an all-female team is even more exciting, and reflects KFC’s unwavering commitment to providing access to opportunities and skill building to people from all backgrounds in every community we operate in.”

Locally, the decision to staff KFC’s 25,000th restaurant is also a reflection of KFC India’s Kshamata (implying potential or ability) program, reinforcing its commitment towards gender and ability parity. KFC India has been a pioneer in the category through their specially-abled program, employing and

working with speech and hearing-impaired team members since 2008. KFC India’s first all-women staffed restaurant opened in 2013.

Source: CSRwire

Know Your Acronyms

In our business, there is a great deal of terminology and jargon. As more processes and systems are added, the acronyms continue to pile up. Thus, AKFCF Quarterly decided it is time for us all to brush up on the many acronyms you will hear in your daily lives and read about in this magazine. Be sure to pass this along to your employees, or post a copy in your offices.

76(5P)

1976(5P) KFC Franchise Agreement

AKFCF Association of Kentucky Fried Chicken Franchisees ARL

Above Restaurant Leader

ASAP

American Showman Asset Program

AUM

Assistant Unit Manager

BOGO

Buy One Get One

BOH Back-of-house BSC

Balanced Scorecard

COB

Chicken on the Bone

COGS

Cost of Goods Sold

DMA

Designated Marketing Area

FA (Or F/A) Franchise Agreement FIT

Food Innovation Team

FSC

Food Safety Consultation

GAC

Government Affairs Committee

14 AKFCF Quarterly Spring 2021

IAYF International Association of Yum Franchisees (formerly known as the IAKFCF, International Association of KFC Franchisees)

QSR

Quick Serve Restaurant

REC

Restaurant Economics Committee

RGM

Restaurant General Manager

KFCC

RMI

Restaurant Margin Improvement

Kentucky Fried Chicken Corporation

NAC National Advertising Cooperative (merged with NFAC to become NCAC)

ROCC Restaurant Operations Compliance Check

NCAC National Council and Advertising Cooperative

ROI

Return on Investment

RSC

Restaurant Support Center

NFAC National Franchisee Advisory Council (merged with NAC to become NCAC)

RSCS Restaurant Supply Chain Solutions (formerly UFPC)

NMS

SBRA upplier Business Relationship Agreement

National Marketing Subcommittee

NPC National Purchasing Cooperative (i.e., KFC NPC) OEC

Operations Excellence Committee

PAC

Political Action Committee

POP

Point of Purchase

POS

Point of Sale

TOL

Territory Operations Leader

TRP

Targeted Rating Point

VOC

Voice of the Customer (formerly CBCC)

YUM

Yum! Brands

YRI

Yum! Restaurants International

Condolences:

Anne Lund Bagshaw, 81, of Marco Island, Florida passed away on Feb. 17, 2021. Anne grew up in Oslo, Norway, but met her husband, Bob, while studying in Paris. They married in 1961, moved to Indiana, and opened their first KFC in 1971 in Jackson, Ohio. Over the next 47 years, they grew to over 30 restaurants and in 2018, the Bagshaw family exited the restaurant business. Anne was active in the KFC franchisee family, making many lifetime friends. She is survived by three children, Jeanine (Jeff Rosselot) Bagshaw, Bruce (Laura) Bagshaw, and Nanette (Chris) Walker; 11 grandchildren; and five great-grandchildren.

William H. Bennett, Jr., 93, of Valdosta, Georgia passed away on Dec. 14, 2020. A former college professor, Bennett and his wife, Irene, became KFC franchisees in 1972. They operated restaurants in Georgia and Tennessee until retirement in 2010. He is survived by his wife of 68 years, Irene Blalock Bennett; his daughter, Carolyn Bennett Betters; son in law, Carl Powell; two granddaughters; and two great-grandchildren.

Michael “Tod” Knight, 58, of Shepherdsville, Kentucky, passed away on Nov. 3, 2020. Tod was a development sales specialist with RSCS. He is survived by his wife, Paula; children, Michael Knight, Jr. (Elisa), Kristen Plappert (Jordan), and Melissa Knight; granddaughter, Amelia Knight; and extended family and friends. Our condolences to everyone with the RSCS. Mearle Warren Rasmusson, 80, of Algona, Iowa passed away on Dec. 13, 2020. On July 23, 1961 he married the love of his life, Linda Anderson. They raised two children in Iowa, and they opened their first KFC in 1972. They retired in 2005, and Mearle spent his time fishing, hunting, and traveling. He is survived by his wife of 59 years; daughter, Laura (Jim) Cowell; son, Michael Rasmusson; four grandchildren; and seven greatgrandchildren.

Margaret Louise Parrish West, 93, passed away on Dec. 15, 2020. Louise was the wife of Victor C. West, who died in April 2016. “Lou,” as she was known to many, was a co-owner of

West Quality Food Service, Inc. Margaret was married Vic West on April 20, 1946. They had four boys — Dick, Bill, Steve, and Tim. She was one of the first clerical workers at Jones County Community Hospital (now SCRMC). She completed her business career as secretary to W.E. “Billy” Howard, president Community National Bank & Trust. She retired in 1968 after the successful opening of their first KFC restaurant.

Daniel E. Woodside, who served for 13 years as CEO of Unified Foodservice Purchasing Co-op (later renamed to Restaurant Supply Chain Solutions), passed away on Mar. 6, 2021. As the inaugural CEO of RSCS, Dan was selected by the founders of UFPC to frame up and lead the newly formed supply chain organization by unifying the membership with a common mission and vision. Many of you may have known or worked with Dan and will remember him for his passion for the brands, the business, the members, and his team.

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Spring 2021 AKFCF Quarterly 15

GAC Report

16 AKFCF Quarterly Spring 2021

New Administration’s Priorities

By Amy Agenbroad

2021

is off to a busy start on Capitol Hill in more ways than one, and isn’t expected to slow down anytime soon! Please continue reading for updates on tax reform and the Department of Labor.

Tax reform Congress recently worked on its first big-ticket item in the new Administration by passing a roughly $1.9-trillion COVID package through an expedited budgetary process known as budget reconciliation. In the Senate, this process only requires a simple majority vote, or 51 votes. The Senate-passed package did not include raising the federal minimum wage to $15 an hour since it was ruled out of order in this process.

So, what’s next? Congress now has competing priorities to focus on: infrastructure and tax reform. The Biden Administration has outlined a comprehensive tax reform plan centered around repealing and rolling back aspects of the Republicans’ 2017 Tax Cuts and Jobs Act, and imposing new or higher taxes on wealthier individuals and larger businesses. The Biden Administration has consistently committed to not raising taxes on households making under $400,000 per year. The core of President Biden’s tax reform plan includes the following: • Increasing the top individual income tax rate for taxable incomes above $400,000 from 37 percent to 39.6 percent.

Spring 2021 AKFCF Quarterly 17

• Taxing long-term capital gains and qualified dividends at ordinary income tax rates, and eliminating step-up in basis for capital gains tax.

• Restoring estate and gift tax rates and exemptions to 2009 levels.

• Repealing the State and Local Tax deduction limit of $10,000.

• Increasing the corporate income tax rate to 28 percent from 21 percent.

• Phasing out qualified business income deduction for filers with taxable income above $400,000.

Democrats, who have the majority only by the Vice President’s tie-breaking vote, face challenges to pass any tax increases.

However, they could look to do so through another expedited reconciliation process, keeping in mind they are limited each year.

However, Democrats would be forced to grapple with the public’s perception of raising taxes during an economic recovery as some Members have expressed hesitancy about raising taxes as the U.S. economy heals from COVID-19. Additionally, congressional Democrats also are prioritizing significant infrastructure spending.

What’s next for the Department of Labor?

With the start of new administrations comes the important aspect and task of appointing new department heads. Boston Mayor Marty Walsh has been nominated by President Biden to serve as Secretary at the Department

Democrats, who have the majority only by the Vice President’s tie-breaking vote, face challenges to pass any tax increases. However, they could look to do so through another expedited reconciliation process, keeping in mind they are limited each year. of Labor. The Senate Health, Education, Labor and Pensions (HELP) Committee reported Walsh favorably to the full Senate by a vote of 18 to 4. His nomination is currently on the Senate calendar awaiting consideration.

Walsh has served as the mayor of Boston since 2014 and is a former member of the Massachusetts House of Representatives.

During his nomination hearing, significant attention was paid to reducing inequality in the workplace, raising wages for workers and the $15 minimum wage, workforce preparedness and job training, and giving workers more freedom to organize.

Thank you!

Thank you to those who contributed to the 2020 AKFCF PAC. Your generous contributions helped keep AKFCF at the table and off the menu during key negotiations throughout the ever-changing 2020. Additionally, creating a pooled set of resources, AKFCF had a hand in effectively accomplishing the below in one year alone: • Paycheck Protection Program (PPP) • Second round of Paycheck Protection

Program (PPP) funding • The RESTAURANTS Act included in the House-passed COVID Relief version • Lowered minimum loan amount in Main Street Lending Program • Qualified Improvement Property (QIP) • Joint Employer Amendment Stay involved. Donate to the AKFCF PAC Contributing to the AKFCF Political Action Committee (PAC) is the best way to support the election and re-election committees of pro-business Members of Congress who share the same concerns as franchisees. The money raised in the PAC goes directly to the campaign of those running for Congress, or incumbent members seeking re-election.

You may make your 2021 AKFCF PAC donation online by visiting our portal on the AKFCF website in the Government Affairs tab.

For more information, please contact your regional GAC representative or Amy Agenbroad of Polaris Consulting, LLC (aagenbroad@polariswdc.com). n

AKFCF – Political Action Committee (PAC)

The AKFCF created a PAC to make sure our voices are heard in Washington, D.C. The AKFCF Government Affairs Committee and the AKFCF PAC Board of Directors would like to thank the franchisees listed below for their contributions this year to the AKFCF PAC. Each quarter, we list the names of the franchisees who have supported the PAC at time of print as a token of our appreciation. This list is all the latest contributions, broken down by region. We encourage you to please join your fellow franchisees and support your AKFCF PAC. For information on how you can become involved, or if you don’t see your name and should, please contact Leslie Sharp, treasurer of AKFCF GAC/PAC at lcsharp4133@icloud.com.

Greater Midwest Mark Lambos Douglas Elish Alessio DiFranco James Mikula Susan Schmidt Heather Dexter Troy Saunders Dale Black Joan Bowling Lesley Hottinger James McKenzie Nanette Walker

18 AKFCF Quarterly Spring 2021

Diana Myers Northeast Ray Aley Cheryl Aley Larry Starkey Keith Cole Tommy Cecconi Tony Cameron David Evans Northwest Calvin White Todd Stewart

Ralph Harman Jeannie Harman Marvin Jorgensen Cindy Jorgensen

Earl Wilson Leslie Sharp Gary West Howard Killgo

Southeast Richard (Dick) West Austin Felker William (Bill) West Dan Rosenbalm Linda Rosenbalm John Brown Chris Fowler

Southern California Amjad Chaudhry Patricia McBrayer Shahid Chaudhry Israel Diaz Southwest Debra Ashmore Brandon Robertson

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20 AKFCF Quarterly Spring 2021

The First-Ever

VIRTUAL AKFCF CONVENTION

a Huge Success

By Kelly Rodenberg and Cory Sekine-Pettite

Spring 2021 AKFCF Quarterly 21

T

he first-ever AKFCF Virtual Convention was an amazing success! AKFCF wishes to thank all who made the event possible — our amazing Convention Partners, KFCC, NCAC, and RSCS; the suppliers who made the virtual expo hall a vibrant and important place to be; our top-notch speakers; the generous sponsors; Booth Production Group; the AKFCF Executive Committee and our very own President, Brandon Robertson; and all of YOU who attended!

We truly hope that you found the experience engaging and enjoyable. We could never duplicate the energy of a live convention online, but we did our best to bring you a great show despite the difficult circumstances we’ve all encountered in 2020.

We opened the virtual Convention website on February 25 with a vibrant, virtual portal where attendees had the opportunity to explore the new technology that allowed them to view the live sessions, speakers, suppliers, sponsors, awards recognition videos, the KFC Foundation’s silent auction items, and to talk with friends and colleagues via the live chat feature.

The AKFCF Virtual Convention kicked off with “Good Vibes” on March 2 with a traditional “fireside chat” between AKFCF President, Brandon Robertson, and KFCC President, Kevin Hochman. They sat down in Louisville to discuss the week’s highlights and provided members with basic instructions on how best to participate virtually.

Nashville singer/songwriter and ACM Award-winning artist, Chris Janson gave an acoustic performance and had everyone singing along with him from home. If you had never heard or seen Janson perform before, you likely now are a fan of this down-to-earth country boy. By the way, he is a big fan of KFC mashed potatoes!

That same evening, the KFC Foundation held a Napa Wine Tasting Fundraiser, hosted by Justin Stewart and Emma Horn. They teamed up with Alpha Omega Winery to present a virtual tasting experience that was fun, allowing attendees to taste three delicious wines and

22 AKFCF Quarterly Spring 2021

enjoy time connecting with friends in Zoom breakout groups. The Foundation raised $100,625 — an amazing accomplishment! Everyone who attended this event is the reason that the Foundation can take care of restaurant employees across the country. By participating, you changed lives. Thank you for your support!

On day two, AKFCF President Brandon Robertson set the tone for Convention with an inspirational keynote address on “Power of the People.” Brandon shared his thoughts on how the power of leadership, resiliency, and the Colonel’s core values made us a stronger brand and family during this pandemic. “Power of the People” is about what the people of KFC have done worldwide since Colonel Sanders sold his first bucket of Original Recipe. And that’s what it’s all about. The power of each person here drives this organization forward, shapes us into leaders, grows our businesses, and builds our legacy. Here’s a recap of Brandon’s keynote:

The Power of Leadership

There are many great leaders in this system. And we each have a unique style as we work through the many different situations our

ethic, and loyalty. As the world reopens, access to quality employees will improve, and we need to be ready with a great place to work for the right people.

Time will tell what 2021 meant for expansion of our customer base, and really no one knows what the restaurant landscape will look like in the next few years. But we will keep evolving. Even during a pandemic, we remain strong, with the support of this association, the NCAC, the RSCS, our vendors, and our KFCC partners. We remain unified around our goals of being the best and staying ahead of our competition. If we harness our power to care for the people who matter most — our customers — then our businesses will thrive.

The Power of Resiliency Napa Wine Tasting Fundraiser, hosted by Justin Stewart and Emma Horn.

restaurants face all around the country. And yet, we are always united in our common goals. Franchisees and managers all have similar problems. Solutions to these problems may vary by location, but we all have the same desire: to serve our customers, to strengthen our businesses, and to capture as much sales momentum as we can.

In the past year, our customers have depended on us for a quality home meal replacement more than ever before. And our drive-thru has been our biggest asset, giving us the opportunity to gain back business we’ve had in the past and to expand into the future in ways we couldn’t have imagined just one year ago.

At the beginning of the pandemic, business rapidly increased in the drive-thru, and handling that volume was challenging. To no one’s surprise, people were going for takeout and that wasn’t changing anytime soon.

As a KFC system, we adapted. We took the opportunity to retain and develop customers by responding effectively to the current situation. Everyone worked hard on speed of service, and for the first time ever we were ranked number-one in speed. The opportunity to improve in speed had always been there, but it got the spotlight during the early stages of the pandemic. The improvements have made our businesses better than ever. Not only was our takeout business impacted, but the digital landscape exploded. Digital sales mix went from 1 percent to a high of 10 percent because people weren’t leaving their homes.

“Power of the People” also means hiring and retaining the right staff.

Many have had challenges with this over the past year, whether it was people calling in sick, or people applying with no intention of accepting a job. It has been tough.

Facing this challenge, we need to stay focused on what works. We can create workplaces that foster a sense of belonging, a strong work

As we look at 2020 in the rearview mirror, it’s important to acknowledge the adversity that all of us faced and even more important, how we managed and what we learned. Our resilience will help us face unknown challenges as we move forward in 2021 together, as the KFC family.

None of the work of the AKFCF would be possible without talented people making it happen, and we need to keep the volunteer train moving. Remember, there’s reward in giving. You will be helping others flourish in their careers because you had help in yours.

The Colonel built this amazing legacy, and we spend every day living up to that while also creating our own. And we do it better together.

The Power of the Colonel

The strength behind the “Power of the People” is the core of the Colonel. His personality was always that of a “people person,” but it went deeper than that. He built this brand by believing in great people, and that great people power success. And it’s up to us to keep that success going. We all have a role to play in helping each other achieve our goals; we make each other stronger as we participate and give back using our unique talents.

“Power of the People” goes beyond just our association. Franchisees, employees of franchisees, corporate employees, and vendor partners have collectively contributed to making our brand as strong as it is today. From marketing, operations, technology and beyond, it takes all of us to be successful. With corporate leadership that is committed to a positive working relationship and building a strong brand, we grow stronger. With vendor partners that provide us with quality ingredients, superior distribution, top-notch technology, and some of the hardest working equipment in the industry, we grow stronger. With franchisees that execute the best processes and live the legacy of this great brand, we grow stronger. At the end of the day, the culmination of everyone’s hard work rests on our shoulders as franchisees. It’s a challenge, but I know we are up for it, especially with the AKFCF here to support us.

Spring 2021 AKFCF Quarterly 23

The Power of Recognition

T

hrough the power of recognition, we revealed the best of the best! Here’s who walked away with a coveted 2021 AKFCF, KFCC, NCAC, or RSCS Award during our virtual Convention!

AKFCF President’s Award – Shawn Brady

Shawn Brady

Bryan Robinson

The President’s Award recognizes and honors a member who has consistently gone above and beyond what anybody would expect of the typical franchisee. The AKFCF president selects one individual each year in recognition of his or her outstanding efforts on behalf of the association. AKFCF President Brandon Robertson said of Brady that he always has been generous with his time in volunteering for the association, and that his business knowledge has been beneficial to all franchisees. “I love our brand. I love the people who make up our brand. I feel like I have a debt to pay to Pete Harman and the people who have paved the path for me. This comes as quite an honor,” Brady said.

AKFCF Colonel’s Legacy Award – Bryan Robinson

Dan Yagoda

The Colonel’s Legacy award recognizes a franchisee who embraced the wonderful gift of continuing a family tradition of becoming a franchisee in our great brand! This year, the honor goes to AKFCF Past President Bryan Robinson. Current AKFCF President Robertson said of Robinson, “We appreciate everything you’ve done; everything you are continuing to do [for the AKFCF].”

The Lifetime Achievement award recognizes an individual who has given decades of outstanding service and voluntary leadership spanning a career in franchising. An individual who has dedicated him or herself to serving all of us!

This year, the honor goes to Dan Yagoda. “Our association has been built on family,” Robertson said. “That’s really due to folks like [Dan] that have been involved and served in so many different ways. It’s my great pleasure to award [Dan] with the Lifetime Achievement Award at this year’s Convention.”

John R. Neal Award – Larry Starkey

The AKFCF annually awards the John R. Neal Award to a franchisee who has made exceptional contributions to our system through their service or affiliation with the NCAC. No one is more emblematic of this distinction than Larry Starkey. “Larry has been a valuable part of the team at KFC and leading our franchisees as an NCAC representative and AKFCF past president,” Robinson said. “I hope to continue to follow in his footsteps.”

“I’m honored. John R. Neal … took me under his wing,” Starkey added. “I felt like he really cared about everybody in the room. I couldn’t be more grateful to know that through this award we are honoring him.”

AKFCF Outstanding Partner Award – Barry Yates, Winston

The AKFCF Outstanding Partner Award recognizes an individual who is not a KFC franchisee, but has made a substantial contribution to the success of our system. This award honors those who have provided us with best-in-class product, support or service, or one who has made an exceptional impact across the system.

This year, that honor goes to Barry Yates of Winston.

Continued on page 26

Larry Starkey Barry Yates

24 AKFCF Quarterly Spring 2021

AKFCF Lifetime Achievement Award – Dan Yagoda

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GAC Freedom Award – Brett Harris This year, Ray Aley, chair of the GAC presented the GAC Freedom Award (an impressive Eagle sculpture) to Brett Harris. “Let me just shout out to the team at Government Affairs,” Harris said in receiving the honor.

“Without them and their hard work on Capitol Hill, none of what we have done could have happened. …I am totally honored.”

Brett Harris

KFCC President’s Award – Jim Beglin

Each year, the president of KFCC chooses to honor a standout franchisee whose work shines as an example of outstanding service to all operators. This year, the award goes to Jim Beglin, president of operations at Harman Management. “It’s an honor not just to work alongside him, but to call him a friend,” said KFCC President Kevin Hochman.

KFCC P.E.T.E Award – Bill Byrd Jim Beglin

This year’s P.E.T.E. (People Encouraging Talent & Excellence) Award honoree is Bill Byrd of PMTD Restaurants. He was presented his award via video conference from KFCC Chief People Officer, John Kurnick, and Monica Rothgery, KFCC Chief Operations Officer.

KFCC Bold Developer of the Year Award – JRN, Inc. Bill Byrd

The Bold Developer of the Year Award recognizes franchisees who are keeping things fresh in their restaurants with remodels and

exciting, new concepts. This year, the honor goes to JRN, Inc., which not only developed new restaurants, but completely overhauled the original KFC in Corbin, Kentucky.

NCAC Hard Way Awards – Staci Rawls, Todd Imhoff, Marcus Shelton, Todd Stewart, Justin Stewart and Noah Hommerding Every year during the Convention, the NCAC presents its Hard Way Awards to some of the brand’s most dedicated supporters who demonstrate their commitment to the Colonel’s values. According to the Colonel, the Hard Way means “the keeping of promises, the deliverance of value in goods, in services and in deeds, with sound merit and good ethics.” This year, NCAC Vice Chair Tom Broome presented the award to KFCC Communications Officer Staci Rawls, RSCS Chief Operating Officer Todd Imhoff and franchisees, Marcus Shelton, Todd Stewart, Justin Stewart, and Noah Hommerding.

RSCS Game Changer Award – Steve Campisano

This year, the RSCS wanted to honor one of its own who not only battled through a tough year of supply chain issued caused by the pandemic, but he helped to orchestrate a successful test of new tenders and the new sandwich.

Congratulations to RSCS Senior Directory of Poultry Procurement, Steve Campisano.

Congratulations to all our winners!

JRN, Inc.

Todd Stewart, Justin Stewart and Noah Hommerding

26 AKFCF Quarterly Spring 2021

Steve Campisano

WORKSHOPS: The Power of Education Attendees had the opportunity to participate in three workshops that focused on timely and relevant industry topics. Presented here is a brief synopsis of each.

Power of the People — This workshop included a panel moderated by John Mays, Director of Equity and Inclusion, KFCC. The panel talked openly about the power of inclusion and the role we all play for KFC to create a safe space where everyone feels they can be their best self! The speakers were amazing and offered our members a true look inside their experiences and vulnerability.

Lessons from the Drive-thru: What We’ve Learned About Accuracy and

Speed — Attendees were able to discover the insights gained throughout COVID-19 as dining rooms closed and our drive-thrus were put to the test. In this workshop, speakers shared data gathered throughout the pandemic, and what it taught us about

speed, accuracy, service, and labor. Attendees learned lessons and best practices to take away and apply to their restaurants.

Annual Legal Update — AKFCF General Counsel Ron Gardner started his update with an “un-traditional joke” that had us laughing just as hard as we normally do in person.

Ron shared his insights on what changes we should be expecting from the federal government (e.g., the PPP), Yum!, KFCC, and our own AKFCF and NCAC, as we move thorough this perilous time together.

Thank you to all our speakers for being part of our first-ever virtual Convention, and for providing rich content to our members.

Spring 2021 AKFCF Quarterly 27

GAC UPDATE: ‘On The Hill’

Dan Gans, principle and founder of Polaris Consulting, and long-time advocate for the AKFCF, provided franchisees with the latest from Capitol Hill. Dan covered important topics to franchisees that included the COVID Relief package, tax reform, minimum wage and the importance of political giving in 2021. See more on the GAC’s work in their report on page 16.

Virtual Trade Show

The AKFCF Virtual Trade Show had tremendous representation with over 121 booths. It has been a challenging time for all of us, and we know that our vendor community has missed seeing the franchisees’ faces and hearing about your businesses.

Franchisees were able to browse the supplier directory, send messages to vendors, visit virtual booths, talk live with their representatives in Zoom rooms, and take advantage of our great partnership. Many thanks to all of those who exhibited with us this year and we look forward to visiting with them in person at the AKFCF Convention in Orlando in 2022. AKFCF wishes to thank all our Convention partners and sponsors for their support. The annual Convention wouldn’t have been possible without their generosity!

The People’s House Party

Cooking at Home with Celebrity Chef Damaris Phillips Chef Phillips may have impressed attendees with her shrimp and grits, but she won over the audience with her impeccable charm and spitfire personality. She took over the KFC kitchen in full force with her Southern dishes and hospitality. Everyone had fun cooking with Chef Phillips and then eating their finished dishes. They were delish!

Damaris Phillips outlasted 11 rival competitors to win season 9 of “Food Network Star.” Since then, she has gone on to celebrate the relationship between food and love on her show “Southern At Heart,” which aired for five seasons. Phillips then went on to co-host “The Bobby and Damaris Show” with Bobby Flay and “Southern & Hungry” with Rutledge Wood.

She also appears regularly as a judge and special competitor on “Guy’s Grocery Games,” “Beat Bobby Flay,” and other Food Network programs.

28 AKFCF Quarterly Spring 2021

After a great day of education, it was time to relax and unwind at the People’s House Party. We understand that a big part of the AKFCF Convention is networking with friends and colleagues.

And it has been a long time since we’ve gathered and socialized at the hotel bars and restaurants, and we’ve missed it ... but attendees had their chance — virtually! They grabbed their favorite beverage and headed into the People’s House Party where they found their favorite KFC friends, vendors, members of leadership, and new faces. It was a fun way to converse, laugh out loud, and see everyone’s smiling faces.

Vendor Panel

AKFCF Vendor Liaison Leslie Sharp — along with vendor partners DoorDash, Ecolab, Summit Innovations, and Winston — held a lively discussion about the trends and turbulent changes of 2020, and what’s on the horizon for 2021 and beyond. The restaurant world changed drastically last year and is continuing to evolve at a very rapid pace. Sharp brought together suppliers who represented some of those pivotal changes: sanitization, speed of service, delivery, and general changes in foodservice.

She reminded us that our vendors and suppliers who support the KFC system are

such an important and valuable resource for us, that we need to be utilizing as a system. Not only do they support the AKFCF and this Convention, but as vendor partners and suppliers, they are a treasure trove of knowledge, insight and experience, and they’re here to help us solve problems, here to help us identify and perfect the trends, and ultimately our vendor community is here to add value to our business.

Special thanks to Kim Redstall (Director of Corporate Development, Summit Innovations), Scott Hessey, Sr. (Corporate Account Manager, Ecolab), Brendan Minehan

(Senior Manager, Strategic Partnerships, DoorDash), and Barry Yates (Global Accounts Manager, Winston) for participating in the panel.

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KFCC Presentations KFCC President Kevin Hochman and his leadership team shared how we have all been impacted by COVID-19 in 2020 and the big initiatives coming in 2021. During the KFCC presentations, Hochman and his leadership team focused on Driving the Core, Winning in Digital, and Restaurants of the Future. Here’s a recap of his opening keynote: We’ve made incredible progress taking care of our guests and teams while taking a nice step forward towards $1.5 million AUVs. During the KFCC brand presentation last year, Hochman talked about our challenges of the rising cost of doing business and the need to grow faster to get to $1.5 million AUVs and continue progressing 4-wall economics. And if you recall, he spoke about a few, big things: • Getting our Core Innovation right to be much more competitive in the big chicken segments — sandwiches & tenders; they are not only the biggest segments, but that’s where all the growth is.

• Accelerating E-commerce — we had just put KFC.com version 1.0 in place and we were starting to expand with aggregators.

tracks and accelerated other pieces of it. For example: • Core innovation on sandwiches & tenders slowed as the processing plants that we needed to get new cutting specifications up and running were struggling to maintain staff and keep up with the business demands. Working new projects, like our chicken sandwich and tenders, took a back seat to just keeping plants going processing chicken we needed for our restaurants.

• Remodels and new builds were basically paused because of the construction challenges and uncertainty around what was going to happen to the business.

• We talked about pricing & menuboard work to make it easier for the guests to order, which would build basket and check, and continue to reduce our dependence on $5 Fill Ups. • We also talked about the importance of continuing to remodel & start growing the estate for the total business.

And finally, we needed to continue to simplify the operation — make it easier to run a KFC. Then COVID-19 hit in March and it really stopped some of that work in its

A real, quality, home meal replacement at a fair price with a brand you know is an incredibly resilient concept that can survive a lot of challenges. And that idea has created value for your business.

30 AKFCF Quarterly Spring 2021

But there were some things that COVID accelerated for us, Hochman said. First, our digital business exploded from 1 percent of mix, finishing the year running at about 8 percent. We had kfc.com version 1.0 in place and we quickly put additional aggregators to capture the increased demand. Customers were looking for more frictionless, contactless, order-ahead experiences as well as an increased in demand for delivered meals.

The second acceleration was the dramatic shift to off-premises dining with dining rooms closed or restricted. Now some of that off-premises growth will retract as restrictions ease and the vaccine is distributed, but some of that behavior will stay, which should be a tailwind for our buckets business.

The other big thing that changed was that customer value perception really leaned on quality and safety more so than price, he said.

This allowed us to basically remove $5 from promotion.

And lastly, COVID-19 accelerated the need for menu simplification, Hochman pointed out. We’ve always known we needed this, but we’ve never been able to figure out how to do this without sacrificing sales, he said. And simplification is critically important as it helps mitigate some of our labor challenges, helps with employee training & retention, speeds

up the drive-thru, and helps with inventory management and cost.

And the good news is KFC proved that it’s a brand that’s recession- and pandemic-proof.

A real, quality, home meal replacement at a fair price with a brand you know is an incredibly resilient concept that can survive a lot of challenges. And that idea has created value for your business. So, the question is: Where do we go from here? With things likely getting closer to normal in the back half of the year, what does a post-pandemic KFC look like? And how are we going to keep the momentum on the business going to get to $1.5 million AUVs and beyond?

The leadership team presented the plans moving forward on how we’re going to

accelerate our journey to $1.5 million. They started off with Ken Muench, the CEO of our branding insights company, Collider, who shared with us how customer needs and behaviors have changed during the pandemic and which of those changes will stick as we come out of the pandemic. To know where KFC should go, we first need to align on where the customer is moving and then craft plans to get ahead of it, he said.

Hochman then sat down with his LT and had a deep conversation on what the plans for 2021 look like — everything from calendar priorities, to taking digital to the next level, to big operational initiatives that will propel us forward towards $1.5 million AUVs. So, what are those priorities for 2021?

Our vision is unchanged, Hochman said.

We must become a brand people trust, and COVID has made that vision even more important. To do that, we have to get to a more relevant menu. We’ve now put the building blocks in place to do that with our new sandwich, new tenders program, and fries, but we must commit to driving those modern and relevant items throughout our menu, POP, and promotional calendar. The challenge for us is how do we promote these improved segments while protecting the core customer who comes to us for COB? The answer is: We must do both.

Hochman has a biweekly conversation with KFCC’s head of customer insights, Brittany Continued on next page

Spring 2021 AKFCF Quarterly 31

Wilson, to make sure he understands what is going on with our customer. He asked her recently, based on her knowledge of young families, what keeps them from coming to KFC? She said “their version of comfort food is still fried chicken, but it’s boneless fried chicken, not chicken on the bone. And when we show families a $20 Fill Up ad, we lose them with mashed potatoes and cole slaw.

Kids don’t eat cole slaw; They eat fries or mac & cheese.” Well, we’ve got to figure out ways to give younger families what they crave without losing our core.

On the customer experience side, we need a SAFE experience, which stands for Secure, Accurate, Fast & Easy for our guest.

At our core, we’re a home meal replacement business, and in order to continue the growth we’ve seen during the pandemic, we must deliver Secure, Accurate, Fast, & Easy experiences for the guest, Hochman said. We’ll also need to be ready for guests when they are ready to come back to dining rooms.

The third pillar is development. We need to recover from COVID and get back to remodeling the estate and new builds. We expect this year will finally be our first year with more new builds than closures, which hasn’t happened in over a decade, Hochman noted. This is a demonstration of the strength of this brand.

And lastly, we need to future-proof our

business — namely going all in on digital and making our brand more inclusive for more people. Hochman shared two data points for this last idea: On the Digital front, remember the gasps he received last year when he said global KFC is over 20-percent digital? That number is now 38 percent, with over 70-percent year-on-year growth. Delivery Click & Collect, Ordering Ahead … it’s all here to stay and it’s growing.

The other data point he gave on future-proofing our business is Millennials are just under half non-white and Gen Z is now 50 percent non-white — and they are starting

to become parents now too. We need to make our brand more inclusive to customers and team members if we want to thrive in the future. It’s just facts now, not opinion.

Hochman also quickly shared where we are on the path to $1. 5 million. The good news is we made some progress in 2020 and are now over $1.2 million in AUVs and these continue to be the right choices to get us to where we need to go. The challenge that we have is based on where we all see wages going in the next 3-5 years, that $1.5-million goal will likely need to be $1.6 or $1.7 million, so we’ve got to accelerate our progress.

NCAC Update from Vice Chair Tom Broome Broome agreed that the theme of this Convention is a true testament to what we’ve been through the past year. It truly has taken the power of the people to get us where we are today. While everyone knows we’ve had some of the strongest sales in KFC history, what you may not know is that we’ve also seen the highest ad contribution collection rates. Nearly 100 percent of our franchisees paid every dollar owed to the NCAC — and on time too. Broome said it made everyone’s job at the NCAC a lot easier. Combine higher sales with higher collections and lower spending, and we have been able to save money, he said. That means that when we decide it’s time to come out swinging on our media and advertising, we have the funds to do so. You’ll see that soon in our sandwich launch plans with strong media weights AND a strong underlay of HE COB.

32 AKFCF Quarterly Spring 2021

RSCS Update with RSCS President and CEO, Steve McCormick, and Todd Imhoff, RSCS COO 2020 was both a challenging and a rewarding year, and the RSCS had to make many adjustments to continue to support the business at a high level. McCormick and Imhoff discussed commodity prices and what is driving the increases, and how the increases will impact food costs for the remaining of 2021. Food cost volatility will be elevated through 2022, but a return to limited inflation is expected by mid-decade. James Butler, SVP, KFC Supply Chain was recently hired for the KFC Concept.

Restaurant employees could

BUILD A

500 EMERGENCY $

FUND

Wrap-up

Every year, the Annual AKFCF Convention gets us all excited about new updates and to break news about the brand’s latest and greatest innovations. We understand that this Convention was not the same, but we proved that conventions do not always have to be in-person to generate great buzz and fun!

The pandemic has completely transformed how we do business, and the Convention celebrated how we have adapted to these changes. It really is all about the “Power of the People.”

in six months

e t a D e h t e Sav AKFCF 2022 Annual Convention Mar. 7-10, 2022 Gaylord Palms Resort and Convention Center Orlando, FL

Must be enrolled in MyChange

by May 31 to be eligible for the

Savings Match Challenge

KFCFoundation.org ©2021 Kentucky Fried Chicken Foundation, Inc. The Kentucky Fried Chicken Foundation is a non-profit, 501(c)3 organization.

Employees must meet eligibility criteria for each program.

Spring 2021 AKFCF Quarterly 33

2021 AKFCF Convention Exhibitors Diamond

Platinum

SILVER

34 AKFCF Quarterly Spring 2021

Gold

Thank You, Sponsors AKFCF GAC Alconox Inc. Basic American Foods Brother International Capitol Light Case Farms CH Guenther and Son Conagra Brands CraftMark Bakery Custom Seating Dart Container Delphi Display Systems DoorDash Essity Professional Hygiene Everbrite, LLC Focus Brands Griffith Foods Gycor International Henny Penny Corporation HM Electronics Inc. Hyginix InfoSync Services Intalytics, Inc. KFCC KFC Foundation Netspend OnDisplay PAR Pride Signs Procter & Gamble Professional RJP Consulting Group RSCS - DES RSCS - Member Programs RSCS Parts Connection

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n

Spring 2021 AKFCF Quarterly 35

POWER OF THE PEOPLE Individuals making a difference for the KFC system

By Kelly Rodenberg

A

KFCF President Brandon Robertson chose “Power of the People” as the theme for his presidential term and the 2021 Annual Convention. The strength of the AKFCF is in the combined wisdom and will of all its members and partners working together toward a common goal. Over his term, he wanted to share stories of people who inspire and who are making a difference — in both large and small ways — across the system and especially during the COVID-19 pandemic. We salute them and say “Thank You” for stepping up in ways that benefit us all. In this third installment, please meet three more talented people who contribute their time and efforts to making KFC a better brand..

36 AKFCF Quarterly Spring 2021

POWER OF THE PEOPLE

Kurt Collins

VP, Commodity Risk Management, RSCS Years with the KFC system: 14 Generating a difference: The RSCS Procurement & Commodity Risk Management team works vigorously to provide supply assurance, which was a daunting undertaking during the past year with COVID-19 related processing plant shutdowns followed by surging demand. Our team also works to limit price volatility for food and packaging items by using financial hedge risk management tools to fulfill our mission of being the world’s premier restaurant supply chain organization providing a competitive advantage to our members.

Looking ahead: Most of my time is spent looking into the future to evaluate how economic trends, government policies, weather, technologies, et cetera, impact agricultural commodity prices. More importantly, our team uses these assessments to formulate solutions and then we work collaboratively with the KFC National Purchasing Co-op board of directors to place financial hedges to capture deflation or to minimize as much inflation as possible for food and packaging items.

Coping with change: Commodity prices change every second of the day, so our team is accustomed to change.

Our key focus is to remain agile, adept, and flexible to capture opportunities when they materialize.

Role model: My father. He lost his life 16 years ago in a farm accident.

Inspiration: My family. My wife, Jennifer, and my son, Lincoln, are extraordinarily talented and they inspire me to do my best each day.

Key advice received: Life is like driving a truck; the windshield is big for a reason and the rearview mirror is small for a reason. It is OK to occasionally look backward, but the focus needs to be on the future.

OUR KEY FOCUS IS TO REMAIN AGILE, ADEPT, AND FLEXIBLE TO CAPTURE OPPORTUNITIES WHEN THEY MATERIALIZE.

Besides KFC work, what do you do for fun or in your free time: Spending time with my family as well as watching college football and wrestling.

Spring 2021 AKFCF Quarterly 37

POWER OF THE PEOPLE

Tim Ridley

Sr. IT Manager, MERIT and Mobile Manager, iPad for KFCC Years with the KFC system: 37

Generating a difference: Stepping back listening to the end users at the restaurant. With the goals of keeping changes simple and easy to utilize for the restaurants.

Looking ahead: Be there for the restaurants providing the best process from a tech tool they can use. Goes back to starting with listening to their needs.

Coping with change: Learn to be flexible and pivot to the needs of the restaurants.

Imagining differently: Nothing is impossible. When you hit the wall, step back and look for ways outside the box to get around, go through, or over the wall to keep moving the needle forward.

Role model: My dad taught me how to be accountable, to learn from mistakes, and it is not that you fall down; it’s how you get up that defines your character.

I HAVE FOUND THAT THERE ARE ALWAYS WAYS TO SOLVE A PROBLEM AND WHEN YOU CANNOT, THERE IS A WAY TO FIND THE MIDDLE GROUND TO GET TO THE END DESTINATION. THAT WAS THE BEST CAREER ADVICE I EVER RECEIVED.

38 AKFCF Quarterly Spring 2021

Inspiration: My sons taught me at a young age to be there and enjoy the moments; for when they are gone, they are gone. You win or lose, but keep moving forward and learning as you go.

Key advice received: Russ Wayne suggested years ago at work to never say “No” to an ask, but to step back and think about it. I have found that there are always ways to solve a problem and when you cannot, there is a way to find the middle ground to get to the end destination. That was the best career advice I ever received.

Besides KFC work, what do you do for fun or in your free time: Family time with my sons and my grandkids. I have four grandkids and they bring out the kid in me for sure. I love playing any sport, getting in the bounce house in my basement with them, Nerf Wars, et cetera. I could go on for days.

POWER OF THE PEOPLE

Austin Felker Vice President, Felker Day, Inc. Years with the KFC system: 5 Generating a difference: I am a third-generation KFC franchisee with a background in international banking. In my former line of work, I evaluated economic scenarios and projected how certain businesses within the bank would perform under stressed or crisis-level conditions.

The outcomes dictated the bank’s ability to do business.

So how does this experience translate in any way to being a KFC franchisee? Surprisingly, I believe there is a tremendous amount of overlap.

Looking ahead: To be a successful KFC franchisee you have to be a lot of things at once. You must be a great critical thinker and quick decision-maker. You have to cultivate and develop relationships with members of your own team and organization as well as vendors, franchisees, and franchisor partners. A great franchisee must be willing to work through unpredictable and oftentimes unforeseen challenges or obstacles.

Coping with change: The best way to handle change, especially from a business perspective, is to be adaptable and even embrace change. In February 2020, it would have been inconceivable to think about closing our dining rooms for the better part of a year. But by remaining adaptable we were able to find untapped operational efficiencies at the drive-thru and back-of-house. Now as a brand, we are completely reevaluating what the future business may look like, especially from a development and digital standpoint.

Imagining differently: While it is important to respect our brand’s heritage and the legacy of the Colonel, we know that the willingness of franchisees to evolve and improve over the years is why we are still here today and will be in the future.

Role model: My parents, Eric & Sandra Felker. I’m extremely blessed to have incredible parents and a loving family.

Inspiration: My grandfather, Troy Day. He grew up on a farm in rural North Carolina with 12 brothers and sisters.

He enlisted in the Navy as an 18-year-old to serve in World War II. After completing his service, my grandad paid his

own way through college, earning a degree in business.

Upon graduating, he took a job working at a bank. His experience in banking gave him the tools to be able to one day run his own business. After working many years in the banking world, my grandad purchased his first KFC franchise in 1966.

Over his years as a KFC franchisee, he grew the enterprise to 26 restaurant locations and served in various leadership roles. During his life, he continued to serve in leadership positions throughout his community, including the Chamber of Commerce, YMCA, Rotary, Lions Club, Mars Hill College, and many other organizations. Recently, my grandad was selected by the Governor of North Carolina to be inducted in the Order of the Long Leaf Pine, a prestigious honor recognizing those with exemplary records of service to the state. My grandfather has lived a model life that continues to inspire me to this day; his family values, commitment to hard work, education, and giving back to the community are pillars by which I hope to live my life.

Key advice received: It may sound like a cliché, but I’ve always been told that the best thing you can do in all aspects of life is to surround yourself with great people that you can trust. That extends out to all levels of any organization or business.

Besides KFC work, what do you do for fun or in your free time: Spending time with family, friends, and our dog. I’m also a big fan of the Carolina Panthers and all things UNC basketball and football. I also enjoy skiing and the occasional round of golf with friends.

Spring 2021 AKFCF Quarterly 39

Leading

By Example Meet this year’s SHINING STARS

40 AKFCF Quarterly Spring 2021

2020-21 Shining Stars Jake Rasor Denise Springer Todd Stewart Raziel Valiente Nanette Walker

By Cory Sekine-Pettite

E

ach year, the AKFCF makes an effort to acknowledge individuals who exceed expectations in the volunteer work they do for our KFC franchisee family. We honor these peo-

ple with a Shining Star Award. There isn’t a definitive checklist of tasks or acts of kindness that Association leadership can turn to when seeking to recognize someone’s contributions to our family; we just know outstanding work when we see it. The recipients of this year’s awards proved that their tireless, unselfish commitment to the AKFCF goes above and beyond the norm. May you be inspired by their leadership, knowledge, and talents — and the many ways they support the franchisee community.

Editor’s note: Not all Shining Stars were available for this article, but we congratulate each of them for their accomplishments.

Spring 2021 AKFCF Quarterly 41

Nanette Walker

Nanette Walker was born into the KFC business — literally. Her family’s first restaurant in Ohio was opened the same day she was born!

Nanette says she grew up attending meetings and conventions where the other franchisees treated her like she was one of their own children. The AKFCF always has been a franchise family, she said. “I have so many great KFC memories growing up,” Nanette said, “especially attending the Colonel’s birthday parties in Louisville and riding on the big steamboat on the river.”

Nanette and her

Raziel Valiente

Raziel Valiente, whom you may recognize as one of the panelists from the virtual Convention’s Power of the People presentation hosted by KFC’s Director of Equity and Inclusion John Mays, has been working in the KFC business since 2011. It was then that her employer purchased 70 KFCs in Southern California and she moved over to the newly formed Great American Chicken Corp. as financial controller. She is now CEO of RBD California Restaurants Limited.

In 2013, she started participating in the SoCal Region. Valiente recalled visiting Dale Black in Iowa to be trained in the Pricing Decision Tool that AKFCF had commissioned from Milward Brown. “I went back and trained franchisees — or mostly, their accountants — on how to use the pricing tool. It was an eye opener for me and gave me an appreciation of the business and how we can maximize profitability using different demographic attributes. I was hooked,” she said.

After that, Valiente started representing the franchise at SoCal meetings. She has since held many positions with the Southern California Region, including as director and treasurer for a few years, vice president (2017-2018) and president (2019-2020). She was elected to the KFC/NPC Board in 2020, and serves on the Budget and Audit Committee as well as The COGS Committee.

Valiente recalled hearing about the Shining 42 AKFCF Quarterly Spring 2021

husband, Chris, are celebrating their 30th KFC anniversary this year! The couple have two sons, Zac and Peyton, whom Nanette hopes will continue the family tradition and become KFC franchisees.

She’s setting a good example, for sure by getting involved in committees and showing her family just how rewarding an experience it can be. Nanette said she jumped right into the VP position in the GM Region so the next stop is the presidency. She also currently serves on the Partnership Survey & Education Committees.

She found out about her Shining Stars honor at the GM’s Fall virtual meeting when AKFCF President Brandon Robertson made the announcement. “Apparently, they are good at keeping secrets,” Nanette exclaimed. “It is the utmost honor because it means my franchisee family notices my hard work and dedication to maintaining our great brand,” she continued.

Undoubtedly, you will be hearing and seeing more from Nanette in 2021 and beyond.

Star Award for the first time when she received a “strange” message. “The current president of the SCKFCFA, Shahid Chaudry, emailed me and asked me some questions, which I thought was a little strange,” she said. “At that time, there were so many spam emails that I had to call him and ask why he was asking.

He said, ‘Just answer the questions; I promise you it is good news.’ I thought maybe he was nominating me for a committee as the questions were all about my involvement in committees.

About a month after, in our virtual regional convention, he recognized me and gave me the [Shining Star] Award.

“It meant a lot to me to be nominated and recognized by the franchisees from the region,” Valiente continued. “We are a small group and over the years, the franchisees have become family to me.

It is a wonderful feeling when you are recognized by your own family.”

You have not heard the last of Valiente.

She definitely is going places. She said she will continue being active in the Association. “I have learned from so many people, and I have been able to bring back what I have learned to our company. And I hope others have learned from me as well.”

Denise Springer

Denise joined the KFC family 25 years ago as an RGM in a corporate restaurant. She says she has been fortunate to have worked in various roles and to wear various hats during her career with KFCC. In 2013, Denise joined an expanding franchise organization as their COO. It was then that she started to really get educated about what it takes to run a successful KFC restaurant. “Although I was involved with the AKFCF as a corporate employee, I got my greatest learnings when I joined the AKFCF on the franchise side,” Denise said. “The board members told me that they do not let anyone fail and they lived up to that motto.”

Denise soon found herself volunteering with the Association at the regional level, “getting her feet wet” by shadowing for the 1st VP position of the Northeast Region before going on to become the NEAKFC president in 2018. “The knowledge I’ve gained has enabled me to subsequently serve on other committees such as the RSCS Poultry Committee, NCAC Test Market Task Force, Beverage Task Force, and the Marketing Subcommittee,” she said. “I’m also currently shadowing NCAC representative,

Larry Starkey, and hope to serve on the NCAC in the future.”

In February of this year, Denise found out she was named a Shining Star. She says the honor means a great deal to her because it indicates that “someone appreciates your contributions to the brand without any targets to hit. It’s my pleasure to be able to serve our internal and external customers through the AKFCF; however, it’s nice to be recognized. To be recognized by my KFC family is even more special. I sincerely and humbly say, ‘Thank you’ for letting me serve.”

In addition to this recent honor, Denise also has received the “Power Builder” award from the NEAKFCF as a corporate Ops Leader. It’s a safe bet that more honors and recognition will be coming her way as she learns the ins and outs of the NCAC and brings her knowledge and work ethic to the AKFCF on a national level. n

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Spring 2021 AKFCF Quarterly 43

KFCC 2021 Franchisee Service Awards Thank you all for your years of service and dedication to the KFC family.

44 AKFCF Quarterly Spring 2021

Edited by Cory Sekine-Pettite

W

e all know that our businesses thrive because of the support we receive from our families. For many KFC franchisees, this family connection runs deep — generations deep. To recognize this longevity, KFCC presents its

Service Awards each year to franchisees, and we highlight those who have served their communities for 40-plus years.

Joanne Solomon, 60 years

Brian Johnson, 45 years

Steve Paris, 60 years

Frederick Bauer, 45 years

Charles Clark, 55 years

Hank Apodaca, 40 years

Eddie Sheldrake, 55 years

Milton Smith, 40 years

William Luehrman, 55 years

Ned Hoelzer, 40 years

Bill and Bonny Shelton, 50 years

Rajeev Parikh, 40 years

Ralph Harman, 50 years Editor’s note: Interviews compiled from new and previously published AKFCF Quarterly material.

Spring 2021 AKFCF Quarterly 45

Fred Bauer started his restaurant career in 1969 at the age of 18 as a cook at a KFC restaurant in his hometown of Cincinnati.

Frederick Bauer

Back in 2016, the Baur family told us about Fred’s already impressive 40 years in the KFC business. Here we are five years later and they’re still going strong. Here is their original story from the spring 2016 issue of the Quarterly: Fred Bauer started his restaurant career in 1969 at the age of 18 as a cook at a KFC restaurant in his hometown of Cincinnati.

He continued to work as he attended college as a full-time student and progressed to assistant manager, then manager, and subsequently area manager of 13 restaurants.

In the mid-1970’s Bauer was contacted

by Arkansas-based KFC franchisee Wallace Fowler, who was acquiring five restaurants in the Joplin, Missouri area. It was during that time that he became a KFC franchisee.

He remained involved, operating those restaurants until 1979 when he moved to Jonesboro, Ark., to work for Fowler Foods, where he became senior VP and oversaw 92 restaurants across six states.

In 1984, Bauer moved back to Ohio and bought five restaurants in the area with the help and guidance of Wallace Fowler. The first three were in Troy, Piqua, and Urbana.

He subsequently added two more in Greenville and Celina, Ohio.

Bauer took an active role as a franchisee, joining the Great Lakes KFC Franchisee Association in 1984 (now the Greater Midwest Region) and eventually serving as president. He served two terms on the NFAC, and in the final year was chairman.

He was part of the transition team combining the NFAC and NAC. He also is past president of the AKFCF (1998-99) and served two terms on the OEC and as director of the KFC Purchasing Co-op.

Charles Clark

Charles Clark was born in Decatur, Alabama in 1941. He worked a variety of jobs during his youth to help with family expenses, including as a paper boy, a grocery store clerk, and picking cotton. During his college years, Charles worked at a fertilizer plant, a clothing store, pumped septic tanks, and babysat for relatives. He attended Alabama Christian College (Faulkner University) in Montgomery, where he played on the school’s first basketball team.

In 2016, he was inducted into the Faulkner University Sports Hall of Fame.

While this award was to honor his talents in basketball, many in the KFC family know Charles for his golfing skills. Many franchisees and corporate leaders have played with him in the AKFCF Convention golf tournaments. Golf is a sport he picked up while finishing his business degree at Florence State College (University of North Alabama). It was during his years at Flor-

Charles Clark

46 AKFCF Quarterly Spring 2021

ence State when he met, and later married, Betty Ann Walker of Tuscumbia, Alabama.

After Betty and Charles married in 1963, his career choice took them to Huntsville, Alabama, where he worked for the Huntsville City Planning Commission.

It was during a visit with Betty’s parents that Charles became interested in the KFC business. You see, when the Walkers came to visit, they would pick up a bucket of chicken from a “new” restaurant. With an interest in having their daughter closer to home, and since they all enjoyed the Colonel’s Original Recipe so much, the Walkers convinced the Clarks to explore the idea of becoming KFC franchisees. Up until this time, the only KFC restaurant located in the Shoals area was in Florence, Alabama.

So in 1966, the Clarks began their careers in the chicken business as franchisees in Muscle Shoals, Alabama. In addition to the three north Alabama locations currently owned and operated by the Clark family, Charles also had ownership in KFCs located in Pulaski, Tennessee; Corinth, Mississippi; and Sheffield, Alabama.

In the 1960s and ‘70s, Robert Walker, brother to Betty Clark, was a partner with Charles in the KFC business, until Robert’s untimely death in 1977. Soon after, his widow, Betty Dale Walker, took on the role of franchisee in her husband’s place, operating the Sheffield KFC and other Alabama locations of which they were owners. In the 1980s, as the next generation began working in the business, the Clarks and Walkers created separate companies and management groups.

“For the first 20 years or so of my KFC career, I surrounded myself with some of the best employees a person could ask for,” Charles said. “Over the years, I have been blessed to receive visits from former employees who love to share their fond memories of having worked at KFC. One former employee in particular, met her husband while she was working as a cashier and he was a customer. Even today, the couple makes an annual trek back to the Shoals area during their wedding anniversary week. They treated me like family, as I did them. That’s what we all were…family.”

“Since that time, I have surrounded

Ralph said the most important thing he has learned is to take care of his customers and his team members. By doing so, they will keep his customers coming back. myself with many other good people, as well as with my family,” he continued. “My family continues to work with me to make this company successful. We all depend on each other to do our parts to make it all happen. Being a small operator has had its challenges over the years, but doing it as a family has made it all worthwhile.”

Ralph Harman

In 2016, Ralph Harman was celebrating 45 years in the business. At that time, he told the Quarterly about his experiences as a franchisee, so here’s a look back at his story:

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Ned Hoelzer

48 AKFCF Quarterly Spring 2021

Ralph started his KFC career along with his father, Griffith Harman, in 1964.

Ralph worked for his father at a KFC in Idaho Falls, Idaho. In 1970, he bought his father out and became a franchisee. Along with his brother, Jay, and wife, Saundra, they built five more restaurants over several decades. After Jay retired in 1998, they sold their restaurants and Ralph and Saundra bought one restaurant in Fairbanks, Alaska. Then they built two others and closed the original location. One is a KFC and the other is a KFC/A&W co-brand, which he ran with Saundra.

Ralph was inspired in his KFC endeavors by his uncle, Pete Harman. Ralph says he learned by watching the way Pete ran his operation. “He was a real people person,” Ralph said. “He always was an inspiration to me.”

Ralph said the most important thing he has learned is to take care of his customers and his team members.

By doing so, they will keep his customers coming back. Ralph said it is a constant challenge to keep the business successful in today’s competitive climate.

“The business has its ups and downs, but people have made the difference,” he said.

Ralph added that he is happy that some of his managers in the Idaho operations went on in KFC as area supervisors for other franchisees. In addition, some team members also have moved up as managers.

Ralph was impressed with Colonel Sanders, whom he met four or five times. The Colonel also visited one of his restaurants in 1976. “He would come in and meet and greet with customers,” Ralph recalled. “He was very hard-working and detail oriented.

He was very impressive and also a very good salesman.”

Ralph served on a number of AKFCF

committees over the years, and won several awards during his career, including the high sales award, the Heart Award, and the White Glove award. He closed out that 2016 interview by thanking all the franchisees and KFCC personnel, as well as his family, who have helped make his successful career possible.

Ned Hoelzer

Forty years ago, Ned Hoelzer bought his first KFC restaurant in Sandusky, Ohio when we heard it was for sale. This is the area in which he grew up, so he has such great memories of his childhood there.

Ned said he thought becoming a franchisee would be a great opportunity to share with his family, not only from a business perspective, but from a personal one as well given his fondness for Ohio. Additionally he said he had Tex Coulter, one of the original franchisees, there to help get him started.

Ned’s business has grown to four locations and more than 100 employees. His original restaurant made $190,000 in its first year. That location makes more than $1.5 million dollars today. It turns out that investment worked out just fine, he says.

The Colonel personally taught Coulter to fry chicken, so when Ned started, he learned from the best, he says. “Our store manager of 36 years, Greg Kubach, and my daughter, Wendy Bridge, are continuing that tradition,” he said. “We have many, many customers who come from other towns to get the best chicken around. That commitment to quality and service have sustained us no matter what else came our way.”

Ned says his key to success has been his fantastic employees, many of whom have worked with him for decades. Their hard work and loyalty are amazing, he says. And his commitment to honor them, and to service customers like they were family make for a great and successful recipe.

His daughter, Wendy, runs the business now, and Ned sees a family legacy and an exciting, innovative future for KFC as he passes the torch. “Hopefully, we will mak-

ing people happy serving Sandusky, Ohio for another 40 years,” he said.

Eddie Sheldrake

In 2016, we interviewed Eddie Sheldrake about his 50th anniversary in the KFC business. Now that he has been franchisee for 55 years, let’s look back at that last interview to get his insights on being a lifelong KFC restaurant owner in Anaheim, California: Eddie and his brother, Don, are KFC franchisees who date their association with the company to 1965, when they opened the first freestanding KFC restaurant in Southern California, in Belmont Shore in Long Beach. It was built for $24,000, had no drive-thru and no dining room. However, along with partner Duke Ritchie, they made it work. In those days, says Eddie, if you had good food, the people would come.

Within four years, they were operating eight KFC restaurants. The partners opened several other restaurants in Southern California, operating more than a dozen KFC units in four counties.

In 1968, they developed Polly’s Pies, a family dining concept that now includes 15 locations throughout Southern California.

Eddie, a former basketball star at UCLA who played under legendary coach John Wooden, was able to duplicate his success on the basketball court in the business world. He attributes his business success to a great partnership with his “very smart” brother, and also working with a lot of great people who are his team members and his customers.

“To differentiate ourselves from our competition, we have been very aggressive in our approach. We are in the people business, making life better for people,” Eddie said. He added that the restaurant industry remains the best place for young people to learn the life skills they can use to have a better life.

“The restaurant industry, especially fast food like KFC, does a tremendous amount of good, especially for those young people who are less fortunate than us,” Eddie said.

“It is important that we change the attitude

of many legislators that we are not the enemy; we can help millions of young people have a better life if government would only cooperate rather than hinder.

By helping youth learn life skills, we can help our communities.”

Bill and Bonny Shelton

The Shelton family is celebratEddie and Don Sheldrake ing 50 years as KFC franchisees. They are among the longest continuously operating franchisees in the country, with several generations working in their restaurants. As they were commemorating their 45th year in

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Spring 2021 AKFCF Quarterly 49

Bill and Bonny Shelton

the business, they sat down with us to share their insights. Here is that story: Bill Shelton grew up in Martinsville/ Collinsville, Virginia and is a graduate of Virginia Tech. He served three years in the U.S. Army and was working as an assistant building project engineer at Sale Knitting when he met Bonny.

Bonny grew up in Savannah, Georgia, and was working as a legal secretary when her parents, Layton and Evelyn Bacon, moved to Danville, Virginia in 1964 to open their first Kentucky Fried Chicken restaurant. One year later, as they planned for a second restaurant in Martinsville, Bonny was asked to come and manage that location. This is where she met Bill.

Bill and Bonny married in December 1966. A few months later, they took over the management of the Martinsville location. In 1968, the couple took a year away from KFC. In 1969, another location was being planned in Roxboro, North Caroli-

na, and the couple was asked to manage that restaurant with the goal of becoming franchisees. They became franchisees in 1971, and in 1972 bought an additional restaurant.

In 1974, Bill joined Bacon Enterprises as the director of operations over eight Bacon Enterprises restaurants, as well as the two KFCs that he and Bonny already operated.

Bonny was already working in the Bacon Office doing payroll, accounts payable, and keeping general ledger. In 1976, after her parents divorced, the couple bought out her father’s part of Bacon, partnering with her mother. In 1983, they expanded by two more restaurants, bringing the total of Bacon Enterprises to 12, including the two previously owned. Gradually, their children began joining the business, first working in restaurants and then moving into Restaurant Support.

Bonny’s mother passed away in 1997, and after five years, Bill and Bonny bought the remaining interest in Bacon Enterprises.

"We believe in and strived to stay true to the standards of Colonel Harland Sanders, and strive to serve his customers with his quality products with fast, friendly service in a clean and safe environment." ­—The Sheltons 50 AKFCF Quarterly Spring 2021

Children Marcus, Debbie, and Jennifer bought their own KFC location in 1997, becoming franchisees. In 2003, Marcus became partners with Bill and Bonny in Bacon Enterprises. Marcus and Jennifer bought yet another store in 2014.

“We believe in and strived to stay true to the standards of Colonel Harland Sanders, and strive to serve his customers with his quality products with fast, friendly service in a clean and safe environment,” say the Sheltons. “We value our team from ARLs to the newest customer service and food preparation team members.”

Milton E. Smith

Milton started as an assistant manager for Conifer Industries at the Lewiston, Maine restaurant in May of 1975. Those were the days of 16-quart pressure cookers, 40,000 BTU stove burners, and 1-hour marinaters.

Chicken, mashed potatoes & gravy, coleslaw and rolls were what we were selling.

Simplicity at its best, Milton said. “It was satisfying to be able to fill a warming cabinet with chicken that was all browned and cooked the same,” he recalls.

In 1981, Milton partnered with Fredrick Thurston to purchase the Presque Isle, Maine restaurant — Milton’s hometown.

Conifer’s next closest restaurant was twoand-a-half hours away, and was a problem from a supervisory standpoint, and Fred was wanting to sell it.

On Feb. 1, 1981, MDL, Inc. closed on KFC, Presque Isle. In the 40 years since that time, Milton says they have experienced fire, relocation, an Air Force base closure (reduction of population by 15,000), the addition of Taco Bell, and a remodel, But he attributes his continued success to his family being active in all things in the small town.

“We have gone from eight employees to 40, some of which have 35 years with us,” Milton said. “They weren’t originally family, but they are now.”

Milton added that his greatest satisfaction is to bring along and see young people start their first job and to be able to mentor them in developing good work habits as they start their careers.

MDL, Inc. is now and has been operated

by Milton’s son, Derik. Derik is an only

Milton E. Smith

child with a family of his own. Derik and his wife, Ellyn, have two children. Their son, Erik — the third generation — has been working in the business while attending college. They truly are a KFC family! n

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Spring 2021 AKFCF Quarterly 51

REGIONAL SHORTS

GREATER MIDWEST UPDATE

By Kevin Schlutz

A

s we are finally recovering from a brutally cold stretch of weather in the Greater Midwest, we desperately long to get together and share stories, fellowship, and best practices with our fellow operators. But for the second year in a row, that’s not going to be able to happen. There’s no spring meeting again this year, thanks to COVID-19 concerns. When you read this, we will have completed our first virtual AKFCF Convention, with no live meetings planned until our fall Super Regional in conjunction with the Southwest Region and others if they so decide. We welcome all KFC operators to our meetings.

It’s hard to describe the feeling of isolation from our KFC family, especially when in the Greater Midwest we are still trying to come together and meld as a newly merged region. Sure, the bylaws are amended and approved, and the officers are in place until after the fall meeting, and the representatives and board are set, but we haven’t had an opportunity to meet face to face (other than virtually) and start building that cohesiveness and familiarity.

We all know the value of coming together at our meetings as operators, vendor partners, and corporate partners. We get so excited to see everyone and catch up on each other’s experiences. We learn from our representatives and take home the ideas that we can use to improve our businesses. We see the latest offerings from our vendor partners and converse with them. We hear from our AKFCF president, executive director, and general counsel. We hear the latest from our corporate partners. The whole trip also is a respite from the day-today that we have all been experiencing for way too long. For some, it’s the only vacation they will get. But until it’s safe, and travel and in-person meetings are allowed, we can’t take that chance.

If nothing else, it makes us appreciate even more

It’s hard to describe the feeling of isolation from our KFC family, especially when in the Greater Midwest we are still trying to come together and meld as a newly merged region.

52 AKFCF Quarterly Spring 2021

the memories we have of past meetings. Right now, I am focusing my hopes on our fall Super Regional meeting in Albuquerque, New Mexico at the wonderful Hyatt Tamaya. Let’s hope that’s not just a dream, but a true reality. There will be so much to talk about!

If things are actually going to get back to normal in the next six months, we all need to start planning.

Our AKFCF Convention sites are already set for another five years, but our region has only this fall’s Super Regional meeting planned. We need to start thinking ahead again. Do we have a spring meeting next year, or just a board meeting? With our much larger region, is it more important to be at an airline hub where flights would be cheaper, as opposed to someplace where the room cost would be less?

Can we actually have RGMs meet on a regional basis anymore? Where should we look at for Super Regional sites? Right now, any place but cold, snowy Iowa sounds rather good.

We always have tried to alternate our meetings east and west to make it closer for part of the Super Regional group. Currently, we are looking for a site in Florida for 2022. I would think that good deals could be negotiated after the beating that the hospitality industry has taken, but I may be wrong. What I am tired of is renegotiating with hotels because of state restrictions or travel bans. Thanks to Ron Gardner for helping everyone through those many negotiations successfully. The other officers of the Greater Midwest have encouraged me to develop a survey for the members about our future meetings, to gauge people’s interest and focus in on potential favored sites. This is your heads up to start brainstorming on what type of meetings you would want and where you would enjoy having them.

Meanwhile, please mark your calendars for Sept. 27-30, 2021 for our Super Regional meeting at the Hyatt Regency Tamaya near Albuquerque.

Google it and you will remember. It is one of my favorite venues. n

NORTHEAST UPDATE

By Mike Houston

A

s the Northeast enters 2021, we are once again reminded of how lucky we are to be part of this great brand.

When the Colonel referred to “Sunday dinner, 7 days a week,” he knew what that meant. Growing up, Sunday dinner always was special. Even on my grandfather’s farm, work stopped on Sunday and my grandmother prepared a special meal.

Families across the world have used our great food to bring their people together during these difficult and challenging times.

I have told my teams that what we do is special and different from the other restaurant chains. When people come together for an occasion, they do not bring a bag of burgers, or pizza, or a box of tacos. I have attended many special events and sure enough someone always brings a bucket of KFC. We are the very definition of comfort food. We bring people back to a better and simpler time when we slowed things down, if only for a moment, to get reacquainted with our loved ones. This has never been more important and relevant than now. I believe our customers have been re-introduced to what KFC is all about.

Our success also is due to incredible leadership on both the corporate and franchisee sides. It is easy to forget how awful the corporate/franchisee relationship was just a few short years ago. We also forget, as we cry about ops simplification, how difficult things were. Do you remember making every biscuit from scratch? How about 50-pound bags of cabbage stacked in the walk-in cooler, or even making the dressing from scratch? Bagging cracklings for making gravy on the stove. Popping chicken thighs and removing the fat and tails. Marinating and re-bagging every single piece of chicken.

Hand-breading popcorn chicken. We are living ops simplification!

If we continue to be good stewards of the brand, making the tough and smart decisions going forward, KFC always will be part of families across the world. So, let us be grateful for what we all are so lucky to be a part of. n

We are the very definition of comfort food.

We bring people back to a better and simpler time when we slowed things down, if only for a moment, to get reacquainted with our loved ones. This has never been more important and relevant than now.

Spring 2021 AKFCF Quarterly 53

FINANCE COMMITTEE REPORT

FACING DOWN FINANCIAL UNCERTAINTY

By Jennifer Thomas, Finance Committee Chair

I

transitioned into the role of finance chair for the AKFCF at the end of 2020, a year full of drastic change and uncertainty for everyone no matter their situation. I have to admit that I considered respectfully declining the position.

With three children under the age of 12, a long list of demands on my time, and the additional challenges of a pandemic, I wasn’t sure this was the right time. But when asked to serve in any capacity, I am always grounded by the example of service of my parents, Bill and Bonny Shelton.

They made it their habit to say yes, rather than no, to serving their fellow franchisees. And I know I’m biased, but I believe the KFC family is better for it.

So, I said yes. And very quickly, many more servant-leaders came in support. I am grateful to the previous chair, Alessio DiFranco, who would not let me fail during the transition, and to the rest of the Committee who made me feel welcome and showed me the ropes. The Finance Committee works hard on behalf of the AKFCF and its members. They scrutinize every line item of every budget and every invoice to ensure the highest standard of fiscal responsibility and stewardship. If you see Roger Sparks (AKFCF Treasurer), Keith Cole (Executive Committee Liaison), Debbie Newton (AKFCF Administrative Director), Kelly Rodenberg (AKFCF Executive Director), Dave Evans (Past Treasurer and All-Around Expert), Chris Fowler (AKFCF Past President and “My Brother from Another Mother”), and Inman Hodges (Head Flunkee), please say a big thank you. Also, please welcome Michelle Hunt (Woman of Many Talents) who joined us

My greatest concern in taking this new role was that current challenges may dictate a deficit budget. …No one wants to dip into our rainy day fund unless absolutely necessary.

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54 AKFCF Quarterly Spring 2021

in March as the AKFCF Administrative Manager. Finance is only sexy when funds are being mishandled or someone is embezzling.

If we are a boring group, you’re welcome.

My greatest concern in taking this new role was that current challenges may dictate a deficit budget. Although the recently instituted Contingency Fund was built for just such challenges, no one wants to dip into our rainy day fund unless absolutely necessary. The situation called for creativity and perhaps a lot of luck. Thankfully, the AKFCF was blessed with both. The biggest promoter or detractor to our budget is the Annual Convention.

The luck came with the release of an expensive hotel and convention center contract. The creativity came with the production of a virtual Convention that was every bit as engaging as the in-person version. Thanks to our President, Brandon Robertson, and the ingenuity of the Convention Committee, we had a successful AKFCF Convention. Many thanks to KFCC and our Vendor Partners who willingly supported this new format as well. While I know we all look forward to the days when we can enjoy each other’s fellowship in the same air space, I hope we learned some new ways to enhance the AKFCF’s mission of serving its members.

2021 will undoubtedly present its own set of new challenges.

Uncertainty abounds … physically, politically, financially, and competitively. But last year taught us that we can face down those challenges and not only survive but thrive. With a bit of luck and creativity, I know we will.

One last thing to mention, and I don’t mean to scare anyone … I majored in biology. n

EDUCATION COMMITTEE REPORT

DELIVERING A VIRTUAL EDUCATION EXPERIENCE

By Rob Rianna

W

ho could have known how difficult things would become for us all since we were last together in Nashville 2020? I distinctly remember leaving our meeting feeling exceedingly enthusiastic about the many possibilities the KFC brand would offer in the coming year. Yet, in a matter of just a few short weeks, everyone found themselves facing challenges never imagined. Our focus quickly became how COVID-19 was going to affect our families, our teams, and our businesses.

KFC franchisees quickly learned how to pivot to keep restaurants open and restaurant teams protected. Luckily, KFCC had already gained valuable experience in handling the pandemic from their operations overseas. They were able to provide a proactive approach and invaluable insight, which most certainly helped calm fears. Restaurant sales were about to explode and KFC franchisees were about to have one of the best years the brand had ever experienced.

As the summer approached, preparations for the 2021 AKFCF National Convention in Washington, D.C. began. The AKFCF and the Education Committee moved forward in June, preparing for the Convention with the hope that meetings and workshops would be live and in-person. Unfortunately, by the time fall rolled around, we had to modify our agenda and determine how to create workshops that could be delivered virtually.

The Education Committee, along with KFCC’s Director of Learning and Development, Cheryl VanAllen, faced a mighty challenge in keeping people engaged in a virtual workshop. Fortuitously, Cheryl had innovative ideas on how to accomplish our goals. First, the committee needed to choose topics relevant to how our restau-

Although this year’s Convention was unlike any other, the AKFCF and the Education Committee truly went above and beyond to make the most of an unprecedented situation. rants were operating during a pandemic.

The team finally settled on “Lessons from the Drive-thru: What We’ve Learned About Accuracy and Speed Workshop” and the “Power of the People Workshop.”

The Education Committee decided the drive-thru-focused workshop was most relevant to our current situation, as this is how we have been operating for the past year. Conducting business in this COVID environment meant that our drive-thru customers accounted for almost 87 percent of our business. Sharing data gathered by KFCC throughout the past year would be important and helpful. Interpreting that data could help the system improve speed, accuracy, service, and labor. This workshop focused on three types of bottleneck: order, window, and guest service. Order and window time only matter if a guest is in the drive-thru line. Our priority had to be getting the guests in line! If a guest has a bad experience, but moved quickly at the order and window, that fast speed is not likely enough to keep them returning. We had to identify a new definition of speed: It is our capacity to handle more guests and keep them coming back more often. Our purpose for this workshop was to provide the system with these key teachings so when dining rooms re-open we can maintain the strong

sales that drive-thru business brought us in 2020.

When it came time to select the next workshop, we knew the social unrest of 2020 commanded AKFCF to create an appropriate workshop with a franchisee leadership panel named “Power of the People.” This panel would be led by KFCC’s newly appointed Director of Equity and Inclusion, John Mays, and would need to feature franchisee leaders from around the country. The panel consisted of Cassandra Simmons, employee relations manager & diversity council chair, KBP; Jamie Jackson CEO, Harman Management; Jose Diaz, Diaz Management Inc.; Raziel Valiente-Chung, CEO, RBD California Restaurants Limited (RBD California); and Shamez Jivraj, CEO, Marble Group of Companies. These esteemed leaders shared how they have addressed equity and inclusion within their companies.

While we recognize many more strides will need to be made to truly get to a better place in terms of equity and inclusion, this “Power of the People Panel” really ignited the process and will aide us in implementing these ideas in our own companies. This topic is so relevant and vital; we are hoping to continue this discussion throughout the remainder of the year.

Although this year’s Convention was unlike any other, the AKFCF and the Education Committee truly went above and beyond to make the most of an unprecedented situation. A huge thank you is extended to the entire AKFCF team that worked tirelessly to find original and inventive ways to bring us together. The Education Committee looks forward to creating distinctive, live workshops for our Convention in Orlando in 2022. n

Spring 2021 AKFCF Quarterly 55

KFC FOUNDATION

RESTAURANT EMPLOYEES CAN DOUBLE THEIR MONEY THROUGH MYCHANGE WITH SAVERLIFE!

By KFC Foundation Communication Coordinator Elizabeth Edrington

T

he KFC Foundation’s MyChange with SaverLife program is designed to empower eligible KFC restaurant employees* to grow their financial know-how, build a habit of saving money, and boost their savings accounts — all in an easy, approachable, and fun way!

After creating a MyChange with SaverLife account through kfcfoundation.org or the KFC Foundation mobile app, members can: • Earn points by logging their budget, saving money, reading articles, and simply signing onto the site once a week.

• Redeem points to get digital Scratch & Save tickets for a chance to win $5 each time!

• Browse the dozens of articles written by certified financial experts that cover real-life topics such as “What can I cut out to save more money?” and “6 steps for when your credit is denied.”

• Read stories of SaverLife members from across the country and engage with them through the community forum.

You Match Total

+ $240 56 AKFCF Quarterly Spring 2021

= $260

$500

• Participate in national challenges sponsored

by SaverLife for more chances to win money.

• Double their money through the KFC Foundation’s $1 for $1 six-month Savings Match Challenge!

Yep, you read that last bullet point right!

Starting this summer, the KFC Foundation will host Savings Match Challenges twice per year for MyChange with SaverLife members, where they could earn up to $260 in FREE money!

Once accepted into the challenge, they just need to grow their savings account balance by at least $10/month for six months and the KFC Foundation will match their savings $1 for $1, up to $40 per month.** Save the full $40 for the first three months and they’ll get an extra $20 bonus!

In just six months, they could build a $500 emergency fund (or boost their current emergency fund by $500).

How does the Savings Match Challenge work?

1. Restaurant employees must sign up for MyChange with SaverLife & link their personal bank account by May 31 to be eligible to apply for the Savings Match Challenge.

2. All MyChange with SaverLife members will receive an email on June 1 with a link to apply for the savings match challenge.

3. Once accepted into the six-month challenge, all they have to do is grow their savings account balance by at least $10/month and the KFC Foundation will match their savings $1 for $1, up to $40/month!

Note: Savings Match Rewards will be paid out at the end of the six-month challenge. To receive their Match Rewards, they must still be employed at a participating restaurant at the end of the six-month period.

What MyChange with SaverLife members are saying…

We sent a survey to our MyChange with SaverLife members in February and received overwhelmingly positive results about the program. Eighty-three percent of respondents said MyChange with SaverLife has motivated them to save more money!

What’s one thing you’ve learned because of MyChange with SaverLife?

I would never do it before.” – Jazmin

“Saving money for college.” – Jordan

“I can save more than what I think.”

– Wendy

“I now have goals to save a certain amount of money.” – Brooke “Looking to see how much I’m projected to have by when if I increase my savings by certain amounts.” – Samantha

“I was interested in the matching contribution and the chance to build an emergency savings.” – Whitney

“To have a fund set up just in case I would ever need it.” – Heather “It’s never a bad idea to save a little extra.” – Jordan “I have learned to pay myself first [by putting money into savings].” – Emily What’s one thing you’ve started doing because of MyChange with SaverLife?

“I started saving more with SaverLife.

“I’m not good with saving money, so this will be a great opportunity for me to save.” – Kue

What motivated you to sign up for MyChange with SaverLife?

“I want to work on building my credit and investing for my future.” – Patricia “To save money and have money matched. Also, the opportunity to win money with the quizzes and giveaways.” – Michael

For restaurant employees to be eligible to apply for the Savings Match Challenge, they must be signed up for MyChange with SaverLife and have their bank account linked by May 31.

Take these next few weeks to really drive this program to your restaurant teams and encourage them to sign up for MyChange with SaverLife via the KFC Foundation mobile app or kfcfoundation.org!

Participating restaurants should have received a flyer about this program in the April 12 POP Kit that arrived in restaurants the first week of April.

Check with your RGMs and make sure they’ve hung this flyer on their Communication Board or somewhere in the BOH for their team to see.

We’re really excited about this opportunity to help restaurant teams build a $500 emergency fund and a habit of saving money, and we hope you are too. Don’t let your employees miss out on this opportunity … let them know about MyChange with SaverLife! n *To be eligible for MyChange with SaverLife and the Savings Match Challenge, one must be employed at a KFC restaurant that participates in the KFC Foundation’s Cole Slaw Donation Program. **Savings Match Rewards will be paid out at the end of the six-month challenge. One must still be employed at a participating KFC restaurant at the end of the sixmonth challenge to receive their Match Rewards.

Spring 2021 AKFCF Quarterly 57

RSCS MEMBER PROGRAMS

CHANGE IS GOOD

By Lainie Yarmuth and Debbie Beavin

I

have a new favorite t-shirt, one that I think will resonate with many. The front of the shirt is sporting the words “Change is Good,” and “You first!” is loudly displayed on the back. Change for the sake of change can be draining. However, change for good — like an opportunity to enjoy an easier, simpler, or more efficient way to get things done — is nothing short of “good.” To that end, I’d like to share the “goodness” introduced through RSCS’s recent Customer Portal launch.

Building on our Members’ feedback, the Customer Portal provides a one-stop shop experience for our members. This website, designed to simplify and improve the buying experience, is prepared to serve many needs. Members can submit restaurant development plans, request and approve quotes, access brand initiatives, order equipment, and retrieve valuable information such as order status, product images, and spec sheets. We have come a long way!

RSCS website usage was virtually non-existent before 2017. However, in 2020, during the first few months of the COVID pandemic, RSCS web orders rose as high as 52 percent.

Members took advantage of the self-service capability to satisfy ongoing operational and PPE needs. These orders, and the on-demand access to place them, were critical to safe and efficient store operations. By the close of 2020, our members had placed 21,400 orders

RSCS website usage was virtually nonexistent before 2017.

However, in 2020, during the first few months of the COVID pandemic, RSCS web orders rose as high as 52 percent.

58 AKFCF Quarterly Spring 2021

through the RSCS website. Toasters and steamers were the top sellers!

To meet our Members’ growing need for immediate access to information and service, enhancing RSCS’s online tools has been a priority. Over the last two years, RSCS has been preparing for a website evolution to provide a more “Amazon-like” experience. As an essential undertaking, the RSCS team revamped all 11,000 item numbers and descriptions to ensure product selection accuracy.

The team isolated and clarified specific attributes for each item to simplify the shopping experience. This detail reduces errors, for example, when a Member needs to order a natural gas fryer as opposed to an electric one.

This new Customer Portal, launched in December 2020, has been used by our Members to place 3,828 orders during its first three months.

The application is most frequently used to submit development plans, approve quotes, place orders, confirm Brand-approved items, access spec sheets, and check shipping status on existing orders.

While the Customer Portal is designed to better serve our Members’ needs, we acknowledge this change has introduced a learning curve. One notable change is the discontinued use of E #’s. We took this opportunity to shift from RSCS’s unique naming convention to begin using a standard item number. To ease the transition, you will be able to search by E# during this learning period.

Check out the various improvements introduced within the new RSCS website!

• There are new ways to search by vendor and by category.

What our customers are saying about the RSCS Customer Portal

“The new RSCS Customer Portal ordering platform has a few great additions, such as the status column on the Purchase History tab and the Support Cases section. The support cases section lets you know the exact status of your return, special order, or inquiry and how long it has been open. The greatest asset of the new system is the Projects Section, which provides a One-Stop-Shop for development projects; it gives a high overview of where you stand on the entire year’s remodels and new builds.” –Kim Gruhn, Flynn Restaurant Group Procurement Manager

• Delivery dates are now visible and can be selected.

• Alternate shipping addresses can be entered when you place your order.

• Tracking information is now available when product ships.

• Freight costs are now available when you place your order.

• Development project information is now visible on the website, including dates, plans, quotes, and orders.

• Franchisee Administrators define who uses the site on their behalf and the dollar limits for each.

To learn more about the RSCS website, please join our Website Wednesday sessions, hosted from 4–5 p.m. EST, the first and third Wednesday of each month (April 7 & 21, May 5 & 19, 2021).

To request a targeted learning session for a team, please email Rich Bingham, Rich.Bingham@rscs.com. n

JOIN US FOR RSCS WEBSITE WEDNESDAYS 1st and 3rd Wednesday of the month April 7 & 21, May 5 & 19, 2021 4-5 p.m., EST https://bit.ly/3bRBkoi

Spring 2021 AKFCF Quarterly 59

EXECUTIVE DIRECTOR UPDATE

THE 2021 VIRTUAL CONVENTION

It was a great experience, but one I hope to never do again.

By Kelly Rodenberg

2020

was one crazy year. From COVID-19 to social awakening to economic upheaval, we were left with a divided country — and no personal contact.

With all of this going on, I was honored to have served as the AKFCF’s executive director during a time when we focused on our strengths, our resilience, and our power to pave our way to the next normal. The AKFCF focused on our mission, and reached out to understand and support the needs of our membership.

We want to continue to learn from yesterday, understand where we are today, and remain determined in our progress for the future. I want to give thanks to the Executive Committee, the board, KFCC, NCAC, RSCS, the suppliers, BPG, Speaking Socially and to our members. I really think it is important to thank YOU — our members and the KFC

family — for staying resilient throughout 2020. We weren’t quite sure where this virtual world would lead us with the Convention and how you would accept it.

The “virtual normal” has been interesting.

There are so many exciting opportunities and options out there, and they keep growing — hourly. It has been exciting to see everyone’s creativity and innovation, and how these platforms and experiences are being designed and what they can do.

Of course, the costs of these technologies are tremendous. The investment can reach into six figures to make these tools work the way you want them to work. We were sticker shocked at first, but we made the best use of our dollars for the AKFCF. And then there is engagement — we’ve found engagement is the hardest piece. It’s a real challenge for us; for you. How do you

We continue to look to the future to innovate so that we can offer ideas and meeting services for next year and beyond that are relevant and effective.

60 AKFCF Quarterly Spring 2021

engage the audience to really connect to new technology, speakers, sponsors, to exhibitors, to content? The speaker and content design piece seem to be more of a natural transition from in-person to the virtual environment.

Event professionals understand best practices to create compelling content, to execute engaging breakout discussions, to connect idea exchanges, and to encourage Q&A. Live presentations, we’ve found, are a much more genuine experience versus the recorded presentation with live Q&A. However, it truly depends on the budget and the timing in terms of speakers’ availability, which we understand. And of course, the fear of COVID prevented some speakers and team members from being with us live in the studio. The engagement piece — especially with sponsors and exhibitors — continued to be a challenge for us. We haven’t quite figured out the “secret sauce” on this one!

Our AKFCF Convention staff is small.

We’re very nimble. There were only two of us, but we’ve looked to our partners to help us expand when and where we needed to.

We’ve been effective on how we managed our Convention and that’s been helpful to get through this.

So, what does the plan for the 2022 Annual Convention look like? We continue to look to the future to innovate so that we can offer ideas and meeting services for next year and beyond that are relevant and effective. I do believe 2021 is going to have its challenges, but by 2022, I think we will be seeing everyone’s faces in Orlando.

We will continue to be creative, thought-provoking, and strategic. Seeing you at Convention and creating new experiences for 2022 is what inspires me to continue looking forward. n

The Hard Way It is comparatively easy to prosper by trickery, the violation of confidence, oppression of the weak … sharp practices, cutting corners — all of those methods that we are so prone to palliate and do as “business shrewdness.”

It is difficult to prosper by the keeping of promises, the deliverance of value in goods, in services and in deeds — and in the meeting of so-called “shrewdness” with sound merit and good ethics.

The easy way is efficacious and speedy — the hard way arduous and long. But, as the clock ticks, the easy way becomes harder and the hard way becomes easier.

And as the calendar records the years, it becomes increasingly evident that the easy way rests haphazardly upon shifting sands, whereas the hard way builds solidly a foundation of confidence that cannot be swept away.

Thus We Builded

®

*Dictionary: Present participle and verbal noun. To fashion or frame according to a systematic plan or by a definite process, to create, to BUILD reputation.

Reprinted by permission of Colonel Sanders, November 1964.

Copyrighted by Harland Sanders, 1973.

LEGAL UPDATE

HIGHLIGHTS OF THE VIRTUALLY BEST LEGAL UPDATE EVER!

By Ron Gardner

I

am writing to you shortly after the conclusion of our first ever AKFCF Virtual Convention.

I hope you enjoyed it as much as I did, and I want to share my heartiest congratulations to the Convention Planning Committee for pulling off a difficult feat under challenging circumstances — making watching the screen fun and entertaining for several hours a day, several days in a row.

I had a small part in the Convention, providing my annual legal update as usual. I wanted to use this space to emphasize for those of you who did attend, and share with you for those of you who did not, some of the highlights of this year’s workshop, so you can stay informed and up-to-date on things that are happening in the KFC world.

I had a small part in the Convention, providing my annual legal update as usual. I wanted to use this space to emphasis for those of you who did attend, and share with you for those of you who did not, some of the highlights of this year’s workshop.

Technology I spoke a lot during the presentation about what is happening with respect to technology in the system. Technology is changing rapidly; there are many moving pieces here and a lot of things you need to know.

The new KFC website, as well as the KFC app, are up and rolling full steam ahead. Digital sales are an increasing amount of your daily sales mix, and having functioning portals for customers to reach us is critical. As part of the rollout of these new digital platforms, we have worked with our KFC partners, through the joint NCAC/AKFCF Technology Committee, to find the best, most efficient and affordable solutions to the technology problems that have been thrust upon us in the last year. As part of this new platform, you

62 AKFCF Quarterly Spring 2021

need to have signed the FiServ/UCommerce Agreement that was sent to you last fall, as all digital payments are processed through that entity. Additionally, for those of you who have been wondering, you are still being paid for your digital sales, although, because FiServ also is the payment processer for all of your credit card payments, the money that was formerly being segregated and coming in through Grubhub is now combined into that payment and accounting stream. You should be able to identify the amount of money coming from each, in order to keep a correct accounting, using Power BI. We also continue to move forward with integration of third-party aggregators. In the next several weeks, you should receive Franchisee Participation Agreements with Grubhub, which will update the current Grubhub agreement.

You also will be getting an amendment to your Uber Eats Agreement that will have the effect of incorporating Postmates into the Uber Eats integrated platform that we have in place (as Uber Eats bought Postmates last fall). As usual, I have been a full participant in the negotiation of the Franchisee Participation Agreements with these entities, and have approved them for your signature. However, I want to remind you, as always, that if you feel like you need independent legal advice, please seek it out. I am not acting as any individual’s lawyer.

As you know, the 3.5-percent Technology Fee on all digital transactions continues. The good news is two-fold. First, because we are no longer using Grubhub as the platform for KFC.com (and instead are running on Yum!’s platform), the additional 2.5 percent that was being charged by Grubhub has been eliminated. This is money that should be flowing straight to your bottom line.

Additionally, while we were able to accelerate an awful lot of expenditures last year because of the

explosion of digital sales, we still did not spend all of the money that was collected through the digital fee. Accordingly, you should have all seen a credit in your K-Rise accounts beginning in February to pay for any technology-based fees, up to and through the time the credit is exhausted.

Going forward, the big technology initiatives include a process where customers can “skip the line” and simply walk in and pick up their order. Details on this program are being worked out and will be shared in the near future. Additionally, as both POS and KDS systems begin reaching their end of life, and we need a replacement software system for Merit, we are working on developing a replacement that will require upgrades of your current POS systems. The Technology Committee has just begun to seriously examine this issue, including technological capability and cost, and hope to be in alignment with KFC’s recommendations in the near future. That way, as people move through their remodel obligations over the next couple of years, it will be clear what technology solutions will be required.

Remodels Speaking of remodeling, if you have a remodel that was due before the end of 2019, that remodel must be done this year before December 27, and really more importantly, you must register your intentions before March 31 — or as soon thereafter as possible. Additionally, there are deadlines coming up in the next couple of months for plans to be submitted to, and approved by, KFCC and for orders for to be placed with the RSCS. Please do not miss these deadlines, as failure to remodel on time can potentially be deemed a material default of your Franchise Agreement.

For those of you with remodel dates in 2020 or 2021, you have until the end of 2022 to be remodeled. However, you must register those remodels with KFCC before the end of this year.

Class Actions There were two class actions discussed.

The first is the Visa/Mastercard Settlement.

At this time, there is nothing for you to do, as the settlement that was approved by the court is on appeal. I will continue to monitor the status of that case and advise

you if and when it is time for any of you to make a claim.

With respect to the Chicken Antitrust litigation, if you made direct purchases of chicken from Tyson or Pilgrim’s (rather than purchases through the RSCS), you are likely entitled to participate in the current class action settlement. I will be sending out more information about this shortly, including information about options related to your claims. Additionally, I believe both the RSCS and Yum! are going to opt-out and proceed to make claims on behalf of those of you that did not make direct purchases, thereby allowing you to both participate in this settlement, and potentially get a bigger recovery on your behalf.

More to come on this.

Government Support I provided everyone with a quick update on PPP2, and the Employee Retention Tax Credits. Additionally, as part of the $1.9-trillion stimulus package that was passed earlier in March under the Biden Administration, we are waiting for more information about the Restaurant Revitalization Fund, which may provide some support for any of you who saw revenues decrease in 2020 versus 2019. The rules and regulations surrounding that program have yet to be published, so I will let you know more when I know more.

Big Rocks Finally, I briefly discussed the fact that we would be negotiating both a new Merit Agreement as well as an “Acceleration Agreement 2.0” over the next 18 months.

The beginnings of those discussions have just started, and I will keep you posted, as I am able, in coming columns.

Thank you all for your support over this last and most difficult year. I am looking forward to when we will be together again in person, hopefully sooner rather than later. Be well. n This column is for the general information of members of the AKFCF and should not be relied upon as legal advice. Please see your own attorney or professional advisor for questions concerning your franchise agreement. Ronald K. Gardner is General Counsel of both the AKFCF and the NCAC.

Ad index 5

AT&T Business

15

Auspex Capital

51

Café Valley Bakery

45

Case Farms

C3

Dr. Pepper Snapple Group

25

Ecolab Kay Chemical Company

54

FSV Payment Systems

1

Gycor International

11

HM Electronics, Inc.

33

KFC Foundation

35

Koch Foods

C2 Magnesol 29

NDA, Inc.

7

Pacific Premier Franchise Corporation

19 Partstown 27

Paychecx, Inc.

47 Paycor 3 PepsiCo 31 Pilgrim’s 13 8, 9 59 49

Procter & Gamble Distributing Restaurant Supply Chain Solutions Tyson Food, Inc.

43 Welbilt C4

Winston Industries

Spring 2021 AKFCF Quarterly 63

Photo Courtesy of KFC Global

LOOKING BACK

64 AKFCF Quarterly Spring 2021

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Barry Yates, Yum! Guru bgyates@winstonind.com 502.643.1506

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