KFC and Pizza Hut Shut Down 537 Branches in Turkey Amid Gaza Boycott Pressure
Istanbul (Quds News Network)- Yum! Brands, the US company that owns KFC and Pizza Hut, has terminated its franchise agreement with Turkish operator İş Gıda. The decision led to the immediate closure of 537 branches and the bankruptcy of İş Gıda, which reported debts exceeding 7.7 billion Turkish lira (about $214 million).
While Yum! Brands cited “failure to meet operational and quality standards” as the reason, the timing of the closures raises questions about the role of the Gaza-related boycott. Local reports indicate that KFC’s sales in Turkey dropped by 40% in recent months, worsening İş Gıda’s financial struggles.
The Turkish company that owns KFC and Pizza Hut expanded aggressively after securing the franchise rights in 2020. It grew KFC’s presence from 125 to 283 locations and Pizza Hut’s from 45 to 254. Despite earning Yum! Brands’ “Best Franchise Partner of 2023” award, İş Gıda relied heavily on debt to fuel its expansion. Rising interest rates and liquidity issues eventually pushed it into financial distress.
Beyond fast food, İş Gıda invested in other industries, including snack production, automotive parts, and media. The financial strain from these ventures, combined with declining sales, contributed to its collapse. A Turkish court has now granted the company three months to resolve its crisis while legal overseers manage its assets.
The boycott movement in Turkey, which intensified after Israel’s genocide in Gaza, has increasingly impacted multinational brands. Turkish consumers have pressured businesses to cut ties with Israeli-linked companies. The Turkish government and private sector have taken significant steps in response to Israel’s ongoing genocide in Gaza. Turkish Railways and Turkish Airlines have removed Israeli-linked products from trains and airport lounges. In a broader move, 45 municipalities governed by the ruling Justice and Development Party (AKP) have banned the sale of Israeli goods, while the Turkish parliament has also eliminated Israeli products from its facilities.
On May 2, 2024, the Ministry of Trade imposed a complete halt on trade with Israel, stating that the ban would remain in place until humanitarian aid could reach Gaza without restrictions. Additionally, President Recep Tayyip Erdoğan has reaffirmed Turkey’s boycott of the World Economic Forum in Davos due to its support for Israel.
Meanwhile, private sector companies with ties to Israel have faced increasing pressure. Zorlu Energy Group, Turkey’s largest investor in Israel, was forced to sell its shares in three Israeli companies, effectively ending $1 billion in investments. The boycott has also severely impacted the food and beverage industry, with Israeli-linked soft drink sales dropping by 50%, prompting companies to introduce steep discounts in an attempt to recover from the losses.
