KFC & Pizza Hut Declare Bankruptcy in Turkiye – All Outlets Shut Down

Global fast-food giants KFC and Pizza Hut are facing a major collapse in Turkiye after their main operator, İş Gıda, was declared bankrupt. This decision has led to the immediate closure of all 537 outlets across the country, leaving approximately 7,000 employees jobless. The company reportedly accumulated debts of $214 million (7.7 billion Turkish lira), making it impossible to continue operations.

Aggressive Expansion Backfired

According to local reports, İş Gıda’s rapid expansion was one of the main reasons behind its downfall. In 2020, the company operated only 138 KFC outlets and 58 Pizza Hut outlets, but by 2024, this number had skyrocketed to 537 locations. This rapid growth was fueled by high loans, but with rising interest rates and liquidity problems, the company failed to manage its finances properly.

Boycott & Supply Chain Issues Accelerated the Collapse

Another major factor was the global boycott against brands linked to Israel following the Gaza conflict. Reports indicate that sales in Turkiye plummeted by 40%, causing severe financial strain. Moreover, supply chain disruptions had already begun months before the bankruptcy, with suppliers reporting a decline in chicken orders.

Employees Left Unpaid & Allegations of Financial Mismanagement

The mass closure has not only affected customers but also left thousands of employees unpaid. Many workers claim that they have not received their January salaries, despite İş Gıda promising to settle payments by the end of February. With the company now bankrupt, those promises remain unfulfilled, putting thousands of families in financial distress.

Adding to the controversy, reports suggest that İş Gıda mishandled its finances, allegedly transferring company funds to other subsidiaries like Krispy Kreme and a wheel manufacturing plant in Germany. Even more shocking, top executives were said to have spent company funds on a $50 million luxury mansion while the company was already drowning in debt.

Will Other Global Brands in Turkiye Be Affected?

The closure of KFC and Pizza Hut in Turkiye has shaken the fast-food industry, raising concerns among other international brands still operating in the country. With rising economic uncertainty and ongoing global boycotts, will more brands face a similar fate?

Source: The Vocket