Popeyes, an American fried chicken restaurant chain owned by Restaurant Brands International, entered into a master franchise and development agreement with Silla Co to open hundreds of fast-food restaurants in South Korea in the near future. Popeye also plans to adopt a significant level of digitalisation in its operations in South Korea. The emphasis will be on offering seamless experience to guests by offering them mobile ordering and delivery capabilities, along with digital ordering screens.
Popeyes commenced its first restaurant in Seoul, South Korea, in 1944, and gradually scaled up its chain to a peak of 200 outlets. However, with fierce competition from local players eroding margins, the chain began shrinking, reaching a low of 10 outlets by 2019. With the Covid-19 pandemic exacerbating the crisis and discussions with potential investors failing, TS Food & System, a subsidiary of TS Corporation, which operates Popeyes in South Korea, decided to shutter outlets and exit the Korean market.
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However, in August 2021, Restaurant Brands International announced plans to return to Korea, engaging in talks with local companies to manage the operations of franchises. Subsequently, the company struck a deal with Silla Group conglomerate, founded in 1967, which operates F&B restaurants, sea-food distribution, fishing, agriculture and industrial manufacturing verticals in South Korea and overseas markets.
Popeye’s entry into the South Korean market underlines its ambitious global expansion plans. In 2021, the QSR brand entered into agreements to launch its brand in the UK, France, India and Romania. It also expanded its presence in Mexico and Saudi Arabia. In the past few years, the brand’s other global expansions include the Philippines, Spain, China, Switzerland, Sri Lanka and Brazil.
Quoting David Shear, President, RBI International, the parent company of Popeyes, “We are thrilled to launch Popeyes with the Silla Group subsidiary. We have strong confidence in the group and are pleased to announce exciting plans to bring our iconic Louisiana-style chicken to one of the largest chicken QSR markets in the world. Our entry illustrates our commitment to serving more guests around the world and the execution of our growth plans for the Asia Pacific region”.
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The re-entry of Popeye’s in South Korea comes at a time when the demand for chicken has been rapidly growing. According to Ms MoonKyung Lee, Senior Managing Director of the F&B division of Silla Group, chicken is ‘one of the largest and fastest-growing categories’ in South Korea’s QSR channel. This ties in with the findings of GlobalData’s Q2 2021 consumer survey, wherein 62% of respondents stated that chicken protein has a positive impact on their health^.
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By GlobalData^GlobalData Q2 2021 consumer survey – South Korea, published in June 2021
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