Yum’s Chinese Chicken Troubles
While Yum! Brands’ (NYSE:YUM) KFC might have hit gold when China took a liking to the fast food chain, recent chicken-related issues show that the company has to stay on the ball or things can go bad quickly.
Yum! Brands has had a few missteps in China before, so the most recent issue didn’t come as too much of a shock: he chicken used at Chinese KFC restaurants allegedly had high levels of antibiotics — higher than acceptable.
The Chinese government didn’t reprimand Yum harshly at the time, hinting that the company may finally be getting past Chinese scrutiny of its brand. However, consumers were a little less forgiving. When word got out about the chicken, thousands commented negatively on the company.
Yum’s chairman and chief executive of its China operations, Sam Su, apologized to consumers and accredited the chicken issues to poor internal communication and a failure to address problems quickly. China is critically important to Yum, as the company earned 44 percent of its revenue there last year…