Consumers Don’t Find Pizzas & Burgers that Yum
Yum Brands reports 6% year-on-year fall in sales of Pizza Hut in the Jan-March quarter; KFC fares better with just 1% decline
New Delhi: Sales of Pizza Hut chain in India declined 6% yearon-year in the quarter ended March while that of KFC dropped 1% as western style foods continue to witness slump in sales with consumer appetites for pizzas, burgers and wraps falling short of companies’ expectations. Yum Brands, which operates quick service restaurant brands Pizza Hut, KFC and Taco Bell, has changed disclosure levels of earnings starting the JanuaryMarch quarter. The company has stopped sharing same store sales of the India business as a standalone entity as it has integrated these into global KFC, Pizza Hut and Taco Bell Divisions.
“Yum has likely clocked 10 consecutive quarters of negative same store sales growth, reflecting challenges for all QSR players,” financial services firm Edelweiss wrote in a report released on Thursday. Yum Brands operates close to 800 Pizza Hut, KFC and Taco Bell stores in the country. Heavy promotions and price-offs haven’t resulted in higher sales, with leading players including Yum, McDonald’s and Jubilant FoodWorks reporting muted low single digit or negative growth for at least the past eight quarters. In January this year, Yum India split operations into three independent verticals for its restaurant brands, hoping to step up sales and make operations nimbler in a slowing consumer market.
Last year in July, a consortium of investors led by private equity firm Samara Capital acquired Pizza Hut’s south and west India franchise operation from the Dodsal Group.
The deal was estimated at close to .₹ 200 crore.
Yum’s franchisee operations are now consolidated between Ravi Jaipuria-owned Devyani International in the north and east and Samara Capital in the south and western region.
Relatively newer entrants to the space include Burger King, Wendy’s and Carl’s Jr.