KFC to increase menu prices for a third time in 2022
Fast food giant KFC will be increasing menu prices for the third time this year amid rising food costs and supply chain issues.
Drew O'Malley, the chief executive of Collins Foods, which owns 261 KFC outlets across Australia and 23 Taco Bell stores, said the fast food retailer is thriving despite the price rise.
Mr O'Malley confirmed KFC customers were "likely to see more [price hikes] in the year ahead" after earlier price bumps in January and June this year.
KFC diners should expect to pay around 1 to 2 per cent more for their favourite menu items, according to the Australian Financial Review.
This means KFC customers could be paying an additional 6 cents per piece of chicken, or an extra 15 cents for a classic Zinger Burger once prices increase.
"We've got to be careful of not getting too far out in front of our consumer to erode the work that's been done over the past decade," said Mr O’Malley at a recent investor conference.
KFC to 'keep value at the centre of customer appeal'
"While we are planning a higher level of menu pricing than historically... I need to take pains to point out this is exactly the environment we want to be winning in value," he said.
"We will continue to keep value at the centre of our customer appeal," he assured customers.
While menu pricing is an important step in the fast food chain's efforts to offset margin pressures, Mr O'Malley said the KFC brand has never been stronger in Australia.
He explained that despite inflation and cost-of-living pressures, KFC continues to go from strength to strength – with same-store sales up 4.1 per cent in the first seven weeks of the new financial year.
When asked when the third price increase would come into effect, Mr O'Malley didn't specify.
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The announcement comes only weeks after KFC made a controversial change to some menu items due to the current lettuce shortage in Australia.
KFC announced a "temporary blend of lettuce and cabbage" would be used in some wraps and burgers in restaurants across NSW, Victoria, Queensland, ACT and Tasmania to combat the shortages.
"We've hit a bit of an iceberg and are currently experiencing some lettuce supply chain disruptions due to the impacts of the recent Queensland and NSW floods," reads a message on the KFC website.
Australians have been hit with food price hikes this year, and the cost of living crisis is set to worsen – with Treasurer Jim Chalmers warning inflation will hit 7 per cent by the end of 2022.
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