Popeyes Chicken Chases Suburbs as KFC Focuses Overseas

Look out KFC. Here comes Popeyes Louisiana Kitchen.

Led by former KFC executive Cheryl Bachelder, the chicken- and-biscuits chain is going national and ramping up the pressure as Yum! Brands Inc. (YUM) focuses overseas, letting its U.S. KFC operations languish in the process.

Long a regional outfit concentrating on the urban market, Popeyes is courting suburban white diners with a new menu and ads. Bachelder plans to double the number of U.S. Popeyes stores to 3,200. KFC has about 4,780 U.S. locations, about 600 fewer than in 2006.

“We’ve really reached the hearts and minds of a much broader customer base,” Bachelder said in an interview in her office at Popeyes’s Atlanta headquarters. While 40 percent of the chain’s customers are black, that’s changing as Popeyes opens eateries in places such as Sparks, Nevada, where about three-quarters of residents are white.

Popeyes, which is owned by AFC Enterprises Inc. (AFCE), will generate sales growth of about 13 percent this year, according to data compiled by Bloomberg. By contrast, U.S. fast-food restaurant sales will grow 1.9 percent overall this year to $170 billion, researcher IBISWorld Inc. said in a report last month. KFC’s U.S. same-store sales rose 1 percent in its most recent quarter, while Popeyes’s increased 8.1 percent.

“We feel good about our strategy going forward,” Virginia Ferguson, a Yum spokeswoman, said in an e-mail. “We’re focused on delivering the world’s best chicken to our customers.” Read More