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Burger King, McDonald's, and KFC are at risk due to the current situation in Russia and Ukraine. The invasion is also putting many businesses on the line, and it includes many of the American fast-food chains.
Yahoo Finance reported that one of the main reasons why these major restaurants' businesses are in danger is because they have significantly expanded in Russia in the last 20 years. It was said that apart from the ongoing attacks in an attempt to take over Ukraine, there is a chance that the Western fast-food brands could also be shuttered as the West handed down sanctions to Vladimir Putin's government as a penalty for its actions.
Aside from Burger King, McDonald's, and KFC, Pizza Hut, Starbucks, and Papa John's could also be affected. Based on Yahoo Finance's estimation, are That's in large part because Western layers have expanded significantly into Russia with their cheap burgers and fried chicken over the past 20 years. By Yahoo Finance's estimation, these brands are operating a combined number of 2,7000 stores in Russia.
It was noted that McDonald's and KFC are the biggest players in the country, with a total of around 1,900 outlets. Moreover, as the situation is escalating fast, executives are said to be moving quickly to reduce investors' concerns over the possible loss of business.
"I guess my only rationale is that there is some concern that these actions today (invasion) will have an impact on our company and what I can tell you is that we don't see it that way," Yahoo Finance quoted Rob Lynch, Papa John's chief executive officer, as saying on Thursday during an earnings call. "One of the great things about being in the food business is that through good times and bad usually the business is pretty stable. We are very, we are a globally diverse company and operate in 50 countries."
On the other hand, Burger King's parent company, Restaurant Brands International, also commented on the crisis that is happening right now during its own annual report. RBI is operating more than 550 Burger King stores in Russia, and it knows the sanctions may also affect them.
"The conflict between Russia and Ukraine could adversely impact economic conditions and demand for dining out as well as result in heightened economic sanctions from the U.S., Canada and other countries in a manner that may adversely affect us and our franchisee's restaurants located in Russia and Eastern Europe," the company said.
Meanwhile, stock prices are plummeting, and oil prices are going up due to the tensions between Ukraine and Russia. The crisis' negative impact on future business results is being feared by many investors.
