What are the Key Location Factors for McDonald's, KFC and Starbucks stores in China?

초록

Since Chinese retail industry foreign investment mainly distributed in urban areas, there were significant differences in number of shops in different cities. Previous researches on FDI mainly focused on national and regional level, which could not explain this phenomenon. So, it is imperative to conduct researches to determine which factors attracted more foreign investment in retail industry. Based on distributed data of Starbucks， KFC and McDonald shops in 296 cities in China mainland, this paper explores their location determining factors. Apart from traditional market size and economic agglomeration effect, the number of university students in each city is also a key driving factor. Although the number of university students is a negative variable in distribution of Starbucks shops, it is a positive variable in distribution of KFC shops. In addition, results of this research show that location of Starbucks and KFC are not affected by the open policy system, which is different from location of McDonald's. The implication for this paper is explained from two perspectives. Firstly, theoretically, this paper promotes the discussion on FDI location determinants from city level, and provides significant reference for establishing location model of foreign investment in China on macro-level. Secondly, from practical point of view, this paper offers some suggestions on attracting foreign investment for city managers, and provides a few advices on location for other retail brands and potential investors on the three brands.

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