Why The Founder of KFC Sued KFC

yeah I started franchising when I was 66 years old he's the same company that I sold for two million sold for 240 million yesterday I didn't get any of that [Music] [Music] foreign Sanders or Colonel Sanders as he'd later be known was born on a farm in Indiana on September 9 1890. he came from very humble beginnings and at just five years old his father passed away in order for the family to survive his mother was forced to take on lots of odd jobs like sewing and working at a canning Factory this meant from a very young age Sanders had to look after his two younger siblings which led him to practicing his cooking from as young as seven years old he'd often stay up late developing his skills and this began to become a very good cook at age 10 Sanders got a job working on a farm but ended up getting fired because he spent so much time with the animals instead of actually doing the jobs he was meant to his mother was Furious he lost the job she told him you're just no good here I am left alone with you three children to support and you won't even work enough so somebody will keep you I guess I'll never be able to count on you Sanders felt ashamed and vowed in that moment he would make a success of his life however shortly after this Sander's life actually got much worse as his mother remarried to a violent man who treated his new Step gets terribly he was very clear about the fact he didn't want them and so at age 12 Sanders moved out of his home and went to make his own way in the world he managed to get a job at another farm and would get it before Dawn to feed the animals then go to school during the day and take on any other work he could get in the evenings unfortunately it was all too much Anna since Sanders hated school in particular algebra he dropped out at just 13 years old Millie a few weeks into the seventh grade [Music] foreign [Music] ERS would go on to try a huge variety of different jobs in his early years these included becoming a streetcar conductor an insurance salesman Tire salesman Steamboat operator Midwife secretary and a carriage painter he even had a brief stint in the US Army as a soldier and served in Cuba when he was just 15 years old although this wasn't how he became known as a colonel as he was only in the Army for about six months before getting discharged most likely because he was found to have been underage by the time he turned 18 Sanders got married and then went on to have three kids of course he needed money to support his family and decided to try and get a more professional job working in the legal field he took a law course that was done via mail but his law career ended when he got into a courtroom role with one of his own clients which destroyed his reputation so Sanders later got a job working at the railroad but when he got fired from that as well his wife Josephine decided to leave him she reportedly gave away all their furniture and house on goods and took their kids back to her parents house Sanders was destroyed by this he'd not only lost his job he'd now seemingly lost his family he went over to their house and hid in the woods but the plan to essentially kidnap his kids and take them home with him when they came outside to play but thankfully at the last moment he instead decided to speak for his father-in-law who made him see sense and so Sanders instead went inside to make things right with his wife and eventually got back together with her however Sanders just couldn't catch a break because that would end in tragedy in 1947 Sanders divorced his wife after one of their sons died at just 20 years old their marriage had fallen apart soon after because they both struggled to come to terms with the grief so as you can see the first half of Harlan Sanders life was played with failures and sadness but luckily a very unlikely development was about to change his life forever foreign [Music] at age 40 Sanders got a job in Kentucky with shell running a gas station and to make extra money Sanders decided to make meals for his customers from the back room given that he was a skilled cook he put out a single table that seated six people and sold ham steaks string beans and hot biscuits Fried Chicken initially wasn't on the menu though as it took too long to prepare about 30 to 35 minutes took he couldn't keep up with the demand he knew that deep frying was one way to cook it faster but this generally made the chicken way too dry crusty and unevenly cooked but then Sanders made a massive breakthrough you see around this time pressure cookers were becoming more widely sold and although they were typically used for vegetables Sanders decided to try it for chicken it took a lot of experimentation to find the right settings and balance of time pressure fat and filtration but eventually Sanders figured out a way to cook chicken in in just eight or nine minutes while still keeping the chicken's flavor and it only got even better when Sanders tried a new seasoning blend which he'd later call his secret blend of 11 herbs and spices very quickly the chicken became a best seller and was a massive hit with Travelers passing through to help increase sales further Sanders advertised his gas station food by painting ads on barn doors in the local area which proved to be great marketing however a competitor nearby called Matt Stewart was extremely annoyed by Sanders aggressive promotion and begun painting over the signs Sanders had put up Sanders warned him he'd shoot him if he didn't stop but Stewart carried on painting over his ads anyway so Sanders along with two managers of the gas station he operated went to pay Matt Stewart a visit however when Stewart saw them coming he immediately pulled out his own gun and fired the bullet narrowly missed Sanders and instead hit one of the managers Sanders had gone with he died immediately Sanders grabbed his own gun and returned fire hitting Stuart in the shoulder all men were arrested by the police after their shootout and Stewart got 18 years in prison for murder while Sanders didn't serve any jail time as he'd fired in self-defense it was an extremely close call for Sanders but the end result was his competitor was now Behind Bars leaving him to dominate the local area sales of his gas station food soared rapidly especially his Fried Chicken he could barely keep up with the demand in fact Sanders built up such a reputation that in 1935 the governor of Kentucky Ruby laffoon bestowed him with the honorary title of Colonel in recognition of his contributions to the state's Cuisine so the colonel title was honorary nothing to do with his military rank but Sanders still embraced it fully and from then on he went by Colonel Sanders with many simply referring to him as the colonel instead of his real name harlands that same year the demand for Colonel Sanders Food meant he needed to move out of the gas station and instead opened up 142 seat restaurants it had taken him until his 40s but he finally seemed to have found success but soon Sanders bad luck seemed to have returned as in 1939 his restaurant burnt down and by the time it was rebuilt World War II had broken out meaning there were no tourists or Travelers passing through which had been his main source of customers and so he ultimately had to sell the place but he didn't give up when the war was over Sanders started a new restaurant which was successful until till the 50s but then the next bit of bad news came in the form of a new interstate highway that was being built which bypassed Sanders location completely thus drastically cutting his sails he was ultimately forced to auction off the business at a loss and so at the age of 65 he now had no business and no other income except his savings and this had to rely on his social security check of just 105 a month now there is some misinformation online that says Sanders nearly ended his life at this point but there's actually no evidence of that in fact quite the opposite Sanders was a very determined man and he wasn't going to give up that easily he said in his biography if I hadn't been 66 years old and had 105 Security check coming in every month I don't know what I would have done but for me it wasn't a matter of giving up it was just a problem of what to do next and so despite being at retirement age Colonel Sanders was really just getting started and little did he know he was on the verge of his biggest breakthrough yet foreign [Music] what about if instead of running a restaurant himself he could franchise he'd let other restaurants sell his chicken and charge four cents for every chicken sold so Sanders put a bunch of pressure cookers in his car along with a big bag of his famous seasoning and hit the road in his 1946 Ford his plan was to travel all across the United States finding potential franchisee restaurants but it certainly wasn't an easy life he had to live out of his car and it was exhausting traveling non-stop when he came across a restaurant he thought looked suitable he'd convinced the owner to let him cook his chicken for their employees and if they liked it he stayed for a few days to cook for their customers hoping they'd like it so much that the restaurant wanted to become a franchisee of his chicken for a while Sanders was met with rejection after rejection he was reportedly turned down 1009 times before finally getting someone to agree how tempting it must have been to quit after a thousand rejections but Sanders have just kept going his first successful franchise came in 1952 when Pete Harmon of South Salt Lake in Utah agreed to sell Sanders chicken Harman owned a large chain of restaurants already and said his sales tripled in the first year once he began selling the Colonel's Kentucky Fried Chicken recipe in fact it was actually this first franchisee the harman who coined the phrase Finger Licking Good which later became the slogan across the whole KFC chain within a couple of years everything had changed and Sanders didn't need to make those long road trips anymore to find new partners people started coming to him instead as wood about his chicken spread rapidly across the country of course Sanders didn't share the exact recipe with franchisees as he was scared competitors would end up copying it so he sent the spice blend pre-made plus Sanders always seemed to have a talent for marketing and clearly recognized that the idea of a secret recipe generated a lot more Intrigue by the end of 1963 he'd franchised over 600 Outlets across the U.S and Canada and built a company worth millions within a couple of years that would be 900 Outlets including some in the UK and Japan his chicken was a huge hit and the franchise model was a massive success Sanders had finally made it and at long last was financially secure but that is certainly not the end of the story story [Music] KFC was thriving but then one day a group of entrepreneurs and investors led by a 29 year old named John Brown came to Sanders with an offer they wanted to buy his business John had been shocked when he learned that KFC didn't even have a sales team and was simply relying on restaurant owners coming to KFC through Word of Mouth in order to open up their own KFC franchise John said to his Partners if we owned this company imagine how quickly we could expand it if we were more aggressive with sales so they made Sanders an offer to buy KFC initially sanders turned them down his business was like a child to him and he was concerned that they'd ruin it but Jon wouldn't let it go he upped his offer to buy KFC to 2 million dollars and swore he'd never tamper with the Colonel's recipe and would always maintain a high degree of quality control he also said he wanted Sanders to stay on as an advisor and Ambassador for the company as he believed having Sanders as the face of the company was one of their biggest marketing assets so in 1964 Sanders finally agreed to sell his business he was 73 at this point and figured this would allow him a little more time to enjoy the final stages of his life once the cell went through Sanders was officially a millionaire although in truth he barely stepped away from KFC at all Sanders enjoyed being part of publicity campaigns and ended up traveling all over the world for various promotions as well as making appearances on many different tv ads he simply leaned into the whole thing wearing his iconic white suit every day meanwhile Jon and the other entrepreneurs who'd taken over KFC's management made some important changes that helped the business grow and opened many new locations however in 1971 John Brown sold the company to a Giant Food conglomerate and that's when everything began to change foreign [Music] unlike John who'd agreed not to tamper with the Colonel's recipes the new owners of KFC did not do that for example they changed the gravy to a version that was much cheaper and easier to make a company executive at the time said let's face it the Colonel's gravy was fantastic but you had to be a road scholar to cook it KFC were expanding quickly and wanted to streamline and so basically they'd made some changes the thing is Sanders still visited lots of KFC stores himself and when he tried the new recipe he said my God that gravy is horrible they ought not to be allowed to sell it it's pure wallpaper paste Sanders wasn't any more complimentary about the chicken either saying it was nothing but a damn fried dough ball stuck on some chicken his criticism was so harsh and so public that won KFC franchisee sued him for libel in 1978 but the case was thrown out however Sanders was so unhappy with the direction KFC was taking under the new owners he opened up his own competing restaurant under the name Claudia Sanders the kernels lady Dinner House this then led to KFC suing Sanders in other words the new owners suing the founder of the company and it was a bitter lawsuit over the copyright of his name and whether he should be allowed to open a competing business using the kernel branding in retaliation Sanders then attempted to sue the new owners in a separate legal battle alleging they misused His Image in promoting products he hadn't developed and Sanders was demanding 122 million dollars in Damages eventually they settled and Sanders got paid one million dollars but had to rename his competing restaurant to Simply Claudia Sanders Dinner House and by the way that restaurant still exists today and is the only place to get the original Colonel Sanders Fried Chicken but still Sanders was a fighter until the end but in 1980 he died from acute leukemia age 90. he was still working until a month before his death as he said he had no interest in retiring and sitting around doing nothing as of today there are over 25 000 KFC outlets around the world and it all started with a guy cooking chicken in a gas station despite constant failures rejections and tragedy is Sanders kept going started his new business model at 65 and became a millionaire by 74 in the famous words of Colonel Sanders himself one has to remember that every failure can be a stepping stone to something better and if you want to see another entrepreneurial success story like this check out my video on how Netflix built their empire and defeated Blockbuster this Netflix video was a long time in the making and I think you'll really like it so just click here to watch it now and I'll see you there cheers

Channel: MagnatesMedia

Views: 1,898,810

Keywords: The story of KFC, story of KFC, history of KFC, KFC origin story, how KFC started, kfc story, how kfc began, the history of KFC, colonel sanders story, harland sanders biography, kfc documentary, business, businesses, companies, company stories, business stories, business story, business movie, business documentary, why colonel sanders hates kfc, why kfc sued colonel sanders, kfcs secrets, magnates media, magnatesmedia, magnetsmedia, magnets media, magnate media, magnatemedia

Id: EEn5AwbPgCg

Length: 14min 49sec (889 seconds)

Published: Thu Sep 29 2022