Fried chicken booms as fish and chip shops adapt or exit

Rising demand for fried chicken reflects consumers switching to cheaper, filling substitutes as real incomes are squeezed. For fish and chip shops, higher input costs and falling demand have forced some to close, while others diversify into fried chicken to spread risk and stabilise revenue. Entry into fried chicken is relatively easy due to low start-up costs, simple menus and limited regulation, but this intensifies competition and reduces long-run profitability. Established fast-food chains, such as KFC, benefit from economies of scale, while independents face thinner margins and greater cost pressures.

How US fried chicken craze is transforming British takeaways - BBC News

1. What is meant by substitutes in the context of the fried chicken and fast-food industry?

2. Using a cost and revenue diagram, discuss the impact of increased demand for fried chicken on the profitability of fish and chip shops.

3. Discuss whether the fried chicken industry in the UK is contestable.