A Brief Explanation of the Logic behind the Location Choice of Fast Food Restaurants in China

Chinese market is relative new for fast food chains. In this article, we will explore the competition between the McDonald’s and KFC. We will review two papers, each one focusing on one different aspect of the competition mode we are studying. For the Mayer’s model, we can apply the profit’s concept into our Hotelling model. For the electoral vote model, we can incorporate the concept of market share. We will try to quantify the variables involved in the real world fast food market. We will assume an imaginary line of positions for the firms to choose. Then, in the section of Theoretical Nash Equilibrium, we will try to solve the strategic setting and apply the principles further in the extensions. Finally we will find empirical evidence, which conforms perfectly to our propositions. To sum up, we propose that KFC and McDonald’s clustering at the center are of reason, generating maximum profit and market share, creating a stable Nash Equilibrium.