McDonalds vs. KFC - Are they always around one another?
Have you ever noticed that while driving in Australia, when you see a McDonald's (Maccas), you'll likely also see a KFC nearby? The economics of this proximity are logical: when craving either McDonald's or KFC at home, you have a specific location in mind. Once in the area, the competition is viable because humans can easily be persuaded between the two options, as both provide similar fast-food offerings. A change in decision might occur due to a long drive-through line at one restaurant, or perhaps a preference for one restaurant's fries over the other. How do these two franchises decide where to open a store? Does one franchise follow the other? Is there a first-mover advantage, or does the first mover simply create demand, knowing it will eventually be shared with its main competitor?
First, I'll examine whether my observation about the proximity of McDonald's and KFC stores is accurate. The map below visualizes store locations, with red dots representing KFC and yellow dots representing McDonald's.
Which suburbs are popular?
While rural areas often have only one McDonald's or KFC, both franchises tend to concentrate multiple stores within single suburbs or postcodes. Unsurprisingly, the Sydney CBD (postcode 2000) boasts the highest concentration, with 10 McDonald's and 5 KFC outlets—a total of 15 options. The chart below shows the top 10 postcodes by total number of McDonald's and KFC stores.
Which state has the most?
Aggregating the data by state reveals a correlation between store numbers and population. McDonald's leads in most states, with Tasmania being the exception. This raises the question of whether KFC has a higher sales market share than McDonald's in Tasmania.
This confirms my initial observation
The data supports the observation that McDonald's and KFC stores are often located near each other. However, McDonald's has a greater overall presence, particularly in rural areas where you're more likely to find a McDonald's without a nearby KFC.