KFC coming to Burma next year

KFC coming to Burma next year

American fast-food chain KFC, formerly known as Kentucky Fried Chicken, will be coming to Burma in the very near future. KFC and its parent company, Yum Brands, appear set to become the first Western fast food chain to operate inside Burma following the lifting of most international sanctions more than two years ago.

The franchisee in Burma will be Singapore-listed Yoma Strategic Holdings, controlled by Sino-Burmese businessman Serge Pun. “Chicken is a staple protein in Myanmar [Burma] and our people recognise the KFC brand and Colonel Sanders’ secret Original Recipe of 11 herbs and spices,” said Pun in a statement released by Yoma on Monday.

Yoma’s Head of Business Development, JR Ching, told DVB on Monday that the launch date for KFC’s first store in the country has yet to be finalised but restaurants will be opening at some point in Rangoon next year. “Yum has a very strong track record of growth and expansion in the emerging market and they’ve been very successful in launching the KFC brand around the world,” said Ching.

According to Ching, the menu for KFC’s Burmese restaurants will serve KFC signature dishes including the Zinger Burger and Original Recipe Chicken. There may however be a few offerings that are unique to Burma. “We are currently working very closely with KFC and their new product development team to tailor a couple of products to suit local tastes to ensure that our products are locally relevant and appealing,” said Ching.

Though their plans have yet to be completely finalised, Ching told DVB that local suppliers are being considered. “As an overarching principle we’ll always strive to source from local suppliers wherever possible. That being said, clearly the infrastructure and the supply chain of the country need to developed, need to be built. So we’re working with both KFC and local partners to make sure this is done, to ensure food safety and product quality,” he said.

Yoma has been listed on the Singapore stock exchange since August 2006. Pun, who made his first fortune in Hong Kong’s property market in the 1980s, has been called by some Burma’s “Mr Clean”, for the ostensibly transparent way he operates his extensive business interests in Burma which range from real estate to an airline.

But not everyone is entirely convinced. A May 2008 Times of London article discussing Pun’s partnering with the aid group Save the Children in the wake of Cyclone Nargis was titled “Britain’s aid millions channelled through tycoon with ties to junta”.

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The article, written by Kenneth Denby, went on to describe Pun and his dealings with the then ruling military regime in rather unflattering terms. “By Burmese standards he is a reputable businessman, but aid workers acknowledge privately that he is not the kind of figure with whom they would associate in normal circumstances. Mr Pun maintains good relations with the Burmese dictatorship, has socialised with its leaders, and is a donor to state-run charities,” Denby wrote.

It remains to be seen how well Pun and KFC’s partnership in Burma will fare. While the chain’s parent owner, Yum Brands, who also owns Pizza Hut and Taco Bell, has had great success in Asia over the years, KFC has had a difficult time in the region as of late. According to the Washington Post, Yum’s third-quarter earnings report which was released last week, showed a 14 percent drop in the third quarter for the company’s China Division. The dive in sales came after a major scandal involving one of KFC’s meat suppliers in China, Shanghai Husi Food Co.

The food scare began in July after Chinese TV broadcast footage purportedly showing workers at Shanghai Husi Food Co using meat that had expired or fallen on the ground. Although KFC severed its ties with the firm, the result of the crisis in China brought a “significant, negative impact to same-store sales at both KFC and Pizza Hut in China over the past 10 days,” Yum stated in a 30 July filing made with the US Securities and Exchange Commission.

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