Yum China Leverages Technology To Expand Stores Without Adding More Staff: Report

Yum China Holdings Inc YUMC is reportedly investing heavily in technology.

According to Yum China's CEO, Joey Wat, the company is increasing its tech investments, enabling it to expand its number of stores without needing additional employees.

"From 2016 to now we increased our number of stores by about 80%. However, our number of staff almost stayed flat [around] 430,000 people," mentioned Wat to CNBC in an interview.

Using technology, she explained that employees can be advanced to oversee multiple stores and assist in launching new ones.

YUMC plans to invest $3.5 billion to $5 billion over the next three years to grow its store network, enhance the supply chain, and improve digital capabilities.

Yum China is actively constructing additional logistics centers of its own. These centers will facilitate the incorporation of advanced technology into their supply chain operations and contribute to lowering carbon emissions, stated Wat

The CEO emphasized that the company's long-term goal is to possess 30% of its logistics centers rather than relying on renting them.

YUMC's technology initiatives include AI-based forecasting for inventory management, building more logistics centers, and considering generative AI for data analysis

The report noted that the company has 33 logistics centers and plans to increase that number to at least 45 in the next three to five years.

Price Action: YUMC shares are trading higher by 1.85% at $57.12 premarket on Friday.