Kyochon F&B Surpasses 400 Billion KRW in Sales Last Year... Record-Breaking Performance

Record Performance Driven by Franchise Growth
First Ever 1 Trillion Won in Franchise Sales

[Asia Economy Reporter Lim Hye-seon] Kyochon F&B, the operator of Kyochon Chicken, achieved its best performance since its establishment last year.

Kyochon announced on the 15th that its consolidated sales last year reached 447.6 billion KRW, an 18% increase compared to the previous year. Operating profit was recorded at 41 billion KRW, a 4% increase. In particular, operating profit in the second half of the year was 25.7 billion KRW, a 68% increase compared to 15.3 billion KRW in the first half, showing continuous growth throughout the year.

Last year, total sales at all Kyochon Chicken franchise stores surpassed 1 trillion KRW (franchise store basis) for the first time in history. There was only one store closure, resulting in a closure rate of just 0.08% out of the total 1,269 franchise stores. Sales per franchise store also grew by 14% compared to 2019. The increase in franchise store sales is mainly attributed to the expansion of delivery demand in the contactless era. In 2020, delivery sales at all Kyochon Chicken franchise stores rose by 21% compared to 2019.

The strategy of converting to medium and large-sized stores to meet the growing chicken demand also proved effective. Last year, chicken sales at 106 stores converted to medium and large-sized stores increased by 26% compared to before the conversion. Considering the restrictions on in-store dining due to COVID-19, the expansion of kitchen infrastructure through store conversion was also effective in meeting the increased delivery demand.

Kyochon plans to continue growth by increasing production per store through the conversion to medium and large-sized stores. If in-store dining normalizes this year, medium and large-sized stores are expected to bring structural growth to the domestic chicken business. In particular, the head office logistics centers will be expanded this year to prepare for increased franchise store order volumes. In the first half of the year, the metropolitan area logistics center and the southern (Gimhae) logistics center are scheduled to be completed. The metropolitan area logistics center located in Pyeongtaek has a site area of 5,000 pyeong and can handle more than 200 tons of volume per day. This is more than twice the existing capacity (about 85 tons). Kyochon plans to establish a growth foundation for all business divisions, including the domestic chicken business and new businesses such as home meal replacements (HMR), through the expansion of its logistics system.

Overseas business is also showing positive signs. Last year, Kyochon’s overseas business recorded sales of about 12 billion KRW, an increase of about 35% compared to the previous year despite the impact of COVID-19. Currently, 42 stores operate in six countries, and there are plans to enter Singapore, the Middle East, and nine African countries within the first half of the year. The global K-food boom is expected to create a favorable environment for expanding overseas business. Kyochon expects this year to be a turning point, moving from the global market development stage to a full-fledged growth stage.

This content was produced with the assistance of AI translation services.