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KNCCO discloses the result of its analysis of Kyochon F&B’s price raise |
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#701 Seoul YWCA 20, Myeong-dong 11-gil, Jung-gu, Seoul, Korea
TEL.: 82-2-774-4050/FAX: 82-2-774-4090
KNCCO discloses the result of its analysis of Kyochon F&B’s price raise
-Poultry prices fell 18.5% over a year ago. Prices for thighs and wings also fell by 17.5%.
This month, Kyochon F&B raised the prices for some items like stick and combo products, pointing to the rise in the expense for operating franchise stores. The Price Monitoring Center of KNCCO (President: Lee Deok-seung) would like to point out issues with this company based on its review of the grounds for its price hikes.
Kyochon F&B raised its prices (i.e., from 16,000 won to 17,000 won for a box of sticks and combo and from 17,000 won to 18,000 won for a box of red sticks and combo). The KNCCO found that the prices for chicken meat continued to fall amidst the supply glut. According to the materials provided by the Korea Broiler Council, the average wholesale prices for chicken meat stood at 3,089 won/kg in June 2014, which was an 18.5% y-o-y drop from 3,788 won/kg or a 15.5% drop from the past five-year average. As for the prices for chicken thighs and wings connected to Kyochon’s most recent price hike, they do not show much difference from the aforementioned price trend.
Kyochon pointed to a rise in its franchise operation expenses, but it is thought that the alleged reason for the rise in expenses was offset by the drop in prices for raw materials. Thus, the excuse for the price hike has not been explained adequately enough. Kyochon F&B should present a cogent explanation for the reason of its price hike so as not to cause unnecessary distrust from consumers. Consumers have already pointed out that fried chicken prices are too high, as compared to raw material prices. Kyochon should reconsider its price hike.
We will continue to watch the prices of fried chicken and actively response for the price rationalization if necessary.
-----------------------------Partners of Korea National Council of Consumer Organizations------------------------------
National YMCA of Korea, Green Consumers Network in Korea, Korea Federation of Housewives Clubs, National Council of Homemakers Classes, Korea Consumer Education Center, National Council of YMCAs of Korea, Consumers Union of Korea, Consumer Affairs Institute, Citizens Alliance for Consumer Protection of Korea
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