Globalization is leading to a smaller world with many multinationals now having a wider footprint in the globe. As a result, companies that seek to grow beyond their national borders have to come up with adaptation strategies that enable them to successfully enter a new market. Burger King is one such multinational. Being a global brand means that it has had to find adaptation strategies that are suitable for each nation they have opened their franchises. This research paper aims to highlight the adaptation strategies employed by Burger King in three countries, namely Brazil, Germany and Mexico.
Company Overview
Burger King Corporation is the ranked as the second largest fast chain in the United States and the entire world. The company franchises more than 10,400 restaurants and owns about 1,000 for a chain-wide total being more than 11,455. The restaurants are located in all 50 states and 56 countries. Approximately 15.7 million customers every day are served by the company with over 2.4 billion Burger King Hamburgers sold out annually across the market. Nearly 100% of the Company’s restaurants are owned and operated by independent franchisees many of them being family owned operations ( Hockfield, 2011 ). Entrepreneurs James McLamore and David Edgerton founded Burger King in 1954 in Miami with the concept to attract the growing numbers of families with reasonably-priced, broiled burgers served quickly. In five years’ time, the company was ready to expand its five Florida Burger King and make it nationwide. The company was sold to Pillsbury in 1967 and by this time it had become the third largest fast-food chain in the U.S. ( Hockfield, 2011 ).
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The products included hamburgers, soft drinks, French fries, milkshakes and deserts. The company added more products to its menu such as whoppers sandwich, non-beef items such as chicken, fish, and vegetarian offerings like salads and meatless sandwiches. Other products introduced during the company’s expansion within and outside the U.S include ices, juices, and bottled waters. The company has established itself internationally in North America, Latin America and Caribbean, also in Europe, Middle East, Africa and Asia Pacific.
Adaptation 1: Germany
Adaptation
As with many other multinationals, one international strategy of ensuring the growth of the corporation while at the same time limiting risks is the practice of franchising. Franchising enables the parent companies to enter new markets with fewer risks as the franchisee takes up most of the risk, including in the running of the business (Miller, 2016). However, franchising is only sufficient in dealing with the dynamics of market entry, and once established, the expansion needs to be profitable to be viable as a business alternative. In this regard therefore, Burger King in its entry of Germany, as with other countries as this research shall show, has had to carry out extensive adaptation moves with the aim of ensuring that their products and services meet the cultural needs of the society.
In Germany, the main adaptation strategy has been the introduction of new foods and drinks to the menu with the aim of capturing local delicacies and cultures. A good example of the introduction of such dietary changes to suit the German population is illustrated through the introduction of beer in the menu as a way of capturing the national culture of having beer as part of the meal (Koontz & Weihrich 2007).
Rationale for Adaptation
There are various reasons as to why this adaptation method is important to all the stakeholders in Germany. First of all, the stakeholders in this regards would include the consumers, who benefit from the products and services offered by companies such as Burger King. Burger King, as well as the German government are the other stakeholders, since they both earn revenue from the operations of the company, and its success is therefore profitable to all these parties. For the people, having a company that not only recognizes but also includes local cultural practices into their organizational culture indicates a company that cares for its clientele. Through the incorporation of local eating habits thus, Burger King is able to market itself more extensively since it caters to wider needs. It also shows the acknowledgement of the company towards the local cultures and practices, serving as a good marketing strategy.
Effectiveness
The use of this adaptation technique is not unique to Germany, but rather illustrates a very common maneuver by multinational corporations. Adapting to local tastes and practices is the best way to win over new local consumers, as opposed to the strategy of trying to provide standardized goods to an international clientele (Miller, 2016). Since humans are creatures of habit, introducing new habits, especially eating habits, is a practice that may take a while, and may not be entirely successful since people are expected to fight change. As a result, bringing a product that more closely reflects what the local client base is used to is a sure way of winning over local consumers. Due to the relationship between perceived respect for local culture, and brand loyalty, the incorporation of local practices as an adaptation measure in Germany has been a huge success if the many numbers of branches opened in the country are anything to go by, with Germany hosting one of the highest numbers of Burger King outlets outside the United States.
Resources
Koontz, H. & Weihrich, H. (2007). Essentials of management: An international perspective . New Delhi: Tata McGraw-Hill.
Miller, C. (2016). An Analysis of the International Expansion of Burger King. Scholars Week . 1.
Adaptation 2: Brazil
Adaptation
Adaptation strategies for Burger King in Brazil differ slightly with those in Germany and other parts of the world due to the different cultural setting. However, there is a clear illustration of the adaptation strategy of re-focusing the menu to suit local tastes, which may also include shifting the size of products offered by the outlets in the country to suit the cultural feeding habits of Brazilians. According to Miller (2016), failing to observe the cultural nuances observed within a particular setting portends a major risk for the organization as this may lead to the firm unknowingly disrespecting a partner in the new state.
The company has also adopted a differentiated pricing strategy that culminates from their establishment of the company as a true creator of value for their clientele (Claro & Gigliotti, 2008). The aspect of value creation is in line with creating new products to suit the Brazilian population, with adaptation affecting for example, the speed of service and the flavoring of foods, as well as the quantity of meat used for their burgers and so forth.
Finally, adaptation in this region also involves the forms of buildings used by Burger King and its franchisees. Due to the difference in climate in the area, with warmer climates being experienced, buildings with terraces and porches are common as a way of providing the clients with more leisurely dining in the warm climate.
Rationale for Adaptation
As with the German example, the adaptation strategies taken up by Burger King in Brazil reflect beliefs within the local population, as well as in the regional climate. Having buildings with bigger terraces for example not only gives a more comfortable dining experience due to the dining space and free circulating air, it also augments the expectations of the clientele making it to these outlets, most of whom are Brazil’s middle class ( Robles, Wiese & Torres-Baumgarten, 2015 ). Burger King’s rationale in Brazil is therefore similar to that of Germany in many ways, believing that the incorporation of local dietary culture will lead to higher sales.
Effectiveness
The adaptation rationale used in Brazil is also very effective for the company as it has allowed Burger King to gain a strong foothold in Brazil. According to Kottak (2018) for example, simply having a menu full of heavy snacks was not cognizant with the Brazilian culture of going to the beach, which precipitated the need to introduce ‘cold’ foods at beach outlets in the country. Adaptation into Brazil is therefore in line with the culture of the region, including the beach life, tourism and socio-cultural characteristics, all of which have led to better sales for Burger King in the country.
Resources
Claro, P. D., & Gigliotti, S. B. (2008). Burger King in Brazil: The Challenges of Expansion . Insper Institute of Education and Research.
Kottak, C. P. (2018). Mirror for humanity: A concise introduction to cultural anthropology New York: McGraw-Hill Education
Robles, F., Wiese, N., & Torres-Baumgarten, G. (2015). Business in emerging latin america . New York ; London : Routledge, Taylor & Francis Group
Adaptation 3: Canada
Adaptation
The adaptation style chosen in Canada is very much in line with those in Germany and Brazil. For example, the adaptation method of incorporating local delicacies and eating habits into the Burger King menu is an adaptation meant to interest locals to try Burger King. In this regard, for the French fries the company has introduced poutine gravy and vinegar, which are staples in the Canadian diet. In addition, advertising in these countries must conform to the beliefs of the country, and must illustrate the practices taken up by the corporation as a marketing strategy.
The Canadian branch of Burger King has also had to carry out another adaptation strategy to increase its sales. The adaptation strategy is to upgrade the Burger King branches in the country to a design resembling stores in the United States (Wright, 2016). From a cultural dimension, Canada and the United States share many characteristics, which may include shared tastes in architectural design. As a result, the perception is that by having modern designed stores, the Canadian branches can attract more stores. In addition, there is a general adaptation of menus that work in the United States due to the closely shared cultural characteristics, such as with the introduction of Jalapeno Chicken Fries (Wright, 2016).
Rationale for the Adaptation
Adaptations in Canada seem to be based on the rationale that there are a lot of shared cultural beliefs between the United States and Canada. Therefore, as per the article by Wright (2016), most of the products that do well in the United States have a higher chance of doing well in their northern neighbor. Nonetheless, the rationale goes beyond associations with the US to encompass cultures that exist mainly in Canada only, such as the use of poutine gravy with French fries. Regarding the redesign of stores to match those in the US and Asia, the rationale may be based on the thinking that designs within these countries represent the highest forms modern architecture, and are thus found to be desirable in Canada.
Effectiveness
As with the other countries, the adaptations chosen for Canada have been effective within the country due to their reflection of local nuances. By having a menu that contains foods that Canadians can relate to, Burger King is able to boost its sales. The strategy of using products tested in the United States also seems to be an effective strategy for adaptation by Canadian Burger King Branches, which is as a result of the many shared cultural characteristics. Despite borrowing ideas from the US, there is a clear attempt to introduce new products that Canadian consumers are more familiar with, which is also an effective adaptation method.
Resources
Wright, L. (November 10, 2016). Burger King Looks to Grow in Canada. The Record. Online,
retrieved from https://www.therecord.com/news-story/6957592-burger-king-looks-to-grow-in-canada/
Conclusion
Adaptation strategies are important to the survival of any organization that seeks to establish itself within a new cultural setting, which often means cross border expansion. Standardization enables multinational firms to establish systems that enable such growth, including in the form of franchises. However, it is not possible to standardize all operations, including the product, product size and price ( Hockfield, 2011 ). Instead, it is easier for organizations to adapt to the cultural norms and practices of the region they intend to expand into, which in turn would enable them to gain a foothold by appealing to the familiarity of the consumers with certain norms. As a result, adaptation is one of the best strategies of international growth, giving multinational corporations a local touch that earns them the loyalty of local consumers. Burger King should as a result continue with the adoption model as a strategy for penetrating new markets, and holding traditional ones as well.
References
Claro, P. D., & Gigliotti, S. B. (2008). Burger King in Brazil: The Challenges of Expansion . Insper Institute of Education and Research.
Hockfield, V. (2011). Fast food: A history of Wendy's, Arby's, Burger King and other popular fast food restaurants . s.l: s.n.
Koontz, H. & Weihrich, H. (2007). Essentials of management: An international perspective . New Delhi: Tata McGraw-Hill.
Kottak, C. P. (2018). Mirror for humanity: A concise introduction to cultural anthropology New York: McGraw-Hill Education
Miller, C. (2016). An Analysis of the International Expansion of Burger King. Scholars Week . 1.
Robles, F., Wiese, N., & Torres-Baumgarten, G. (2015). Business in emerging latin america . New York ; London : Routledge, Taylor & Francis Group
Wright, L. (November 10, 2016). Burger King Looks to Grow in Canada. The Record. Online, retrieved from https://www.therecord.com/news-story/6957592-burger-king-looks-to-grow-in-canada/
