KFC belongs to a monopolistic competitive market structure

A monopolist market happens to be one wherein there are large number of buyers and sellers in the market place. There are no significant barriers to entry and firms are free to enter or exit the market place whenever they would want to. However, it is necessary that firms produce identical goods to one another which in this case is food for the market type to be fulfilled and also that they try and differentiate their products through other methods such as branding, advertisement or any other experience-based differentiation and is different from price-based competition. No firm is big enough to influence the market and if it charges a higher price for an identical product, it would soon run out of business as competition offers the same products at a relatively cheaper price.

What this means for KFC and its growth path is that the market would give constant returns to it at a certain price point beyond which demand and market share are not possible. It has to continuously evolve itself by providing a better experience to the customer or heavily spending money on market advertisement, branding, packaging and other means to retain customers and to bring in new ones. The growth thus is limited in size and will happen only if the company chooses to differentiate the product as compared to others in the market place.

What this then does is that even when you are selling at the same price point which other people are to avoid competition, the market share which you hold becomes larger and customers make repeat purchases because of which you make higher profit margins in the short run.

Thus we can conclude by saying that, growth for the company is possible in this market structure only if it builds an image in the minds of the consumer and evolves its branding, marketing and advertising techniques in a manner that the customer believes in the purchase and the company giving you and edge over others in making profits continuously.