In response to the recent geopolitical tensions, American fast-food giant KFC has made the decision to temporarily close over 100 units across Malaysia, with a high number of closures currently taking place in Melaka as well as Kelantan. This sudden move comes amidst growing calls for boycotts against perceived ties to the United States that has been known to publicly support Israel’s actions in the Palestinian enclave of Gaza since 7th October 2023.
According to some sources, over 21 KFC outlets in Kelantan state have temporarily ceased their operations, followed by 11 outlets in Selangor and Kedah, 10 outlets in Terengganu and Pahang and 15 outlets in Johor. The decision to suspend most operations was solely decided by QSR Brands, the head responsible for managing KFC franchises across Malaysia. Prior to the boycott movement, the decline in customer traffic in the recent weeks took a huge toll on the business.
However, while the closure was linked to the ongoing boycott towards food franchises, it was revealed that KFC was not the list of BDS’ targeted companies. “KFC is not on the BDS list of targeted companies, but many Malaysians see any American fast-food operator to be related to Israel, including KFC.” stated by Professor Mohd Nazari Ismail, chairman of the Boycott, Divestment, Sanctions (BDS) group. The BDS group is known for promoting methods of boycott against Israel for years. However, with that very statement, similar sentiments are occurring in other parts of the world where U.S related brands are being boycotted as well.
While KFC’s closures in Malaysia are framed as a response to the boycott, some speculate that the company itself saw this as an opportunity to address the underperforming units, allowing them to cut costs considering the economic conditions. On the contrary, their staff are given the chance to relocate to other busy franchises as means to utilise resources and increase positive customer engagement. Unfortunately, KFC didn’t address how long the closures will stand or when they plan to reopen the affected stores.
KFC’s decision to scale back operations in Malaysia underscores the complex intersection of geopolitics and business, highlighting the impact of international conflicts upon multinational corporations and local economies alike.
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Sources: The Straits Times.
Ariani Soraya contributed to this article.
