Wendy Zhang/ Shanghai Daily news

In response to McDonald's plan to charge 2.5 million yuan (US$300,000) in franchising fees, KFC announced yesterday that it would not reduce its current fee of eight million yuan, eastday.com reported today.
"We have no plan to lower our threshold for people to purchase mature and profitable KFC stores," said Tang Damo, spokesman with the Yum! Restaurants China, operator of KFC and Pizza Hut, adding that two million yuan in franchising fees for a Pizza Hut Delivery Store will also not be reduced.
Currently, direct sales still play a main role in KFC's Chinese operations, while the franchising business only plays a complementary role, Tang explained. KFC is very strict in examining the qualifications of franchisees, so the company will not focus on the number of franchising stores, he indicated, adding that it is unnecessary for KFC to follow McDonald's pricing policies.
Two days ago, fast-food giant McDonald's announced in Shanghai that it would open approximately ten franchise outlets on the Chinese mainland by June 2006, and individuals with 2.5-3.2 million (US$300,000 -US$385,000) could apply for franchises.