KFC, Pizza Hut Indonesia admit boycotting pro-Israel products destroying revenue

KFC Indonesia was hit by boycotting actions in Indonesia.

PT Sarimelati Kencana Tbk (PZZA) as the Pizza Hut license holder admitted that it was greatly affected by the boycott action. Pizza Hut is accused of being pro-Israel because it comes from the United States (US) which supports genocide in Gaza, Palestine.

"We are definitely affected by this incident," said Pizza Hut Indonesia President Director Hadian Iswara, quoted from the Public Expose Result Report which was released on Monday (4/12/2023).

Hadian did not explain in detail how much impact or loss the boycott had on the company's sales performance. However, before the call for a boycott was issued, the company's performance was indeed on a downward trend.

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Based on financial reports up to the third quarter of 2003, Pizza Hut Indonesia recorded a loss of IDR 38.95 billion. This loss increased 9.74 percent from the same period last year which amounted to IDR 35.49 billion.

The company's performance worsened due to boycotts and demonstrations in several regions. The company faced demonstrations in Aceh, Sumatra, Bulukumba, Sulawesi, Pamekasan, Madura.

Pizza Hut Indonesia recognized the boycotting action declining its revenue.

"We convey that Pizza Hut Indonesia respects the democratic aspirations of the Indonesian people and we understand that the situation that occurred is based on sympathy for the Palestinian people," said Corporate Secretary Kurniadi Sulistyomo.

Pizza Hut Indonesia Director Boy Ardhitya Lukito said that the slow clarification from the government was the cause of the big impact of the boycott action on their products.

The management of PT Fast Food Tbk (FAST) admitted that the boycott call had an impact on sales of its restaurant chain, KFC. KFC is one of the brands on the boycott list after providing support to the Israeli army.

"The effects of the boycott on our products include a decrease in our sales and business transactions," wrote FAST management in the Annual Public Expose Results report released on November 28.

To address this impact, the company responded by releasing a number of new products and promotions designed to replace lost transactions. To minimize the impact of the boycott, the company is currently focusing on intensive promotion of the products it sells.

With declining sales of KFC products, FAST management revised its growth projections in 2024 from the previous 15 percent to 10 percent. The company believes it can achieve this target through a strategy starting at the end of 2023. Throughout the third quarter of 2023, FAST recorded a net loss of IDR 152.41 billion.