As high inflation and cost pressures persist, chicken franchise chains are drawing a line against price hikes across the board. At the center is Genesis BBQ Group (BBQ), which operates BBQ, with a preemptive declaration to freeze prices. The industry sees this not merely as absorbing expense, but as a judgment that touching prices now poses a bigger risk.
According to the dining-out and food industries on the 24th, major chicken franchises such as BBQ, bhc, and Kyochon Chicken say they have no plans to raise prices for the time being. Geopolitical tensions from the Middle East have sent global oil prices soaring, pushing up the costs of breeders, feed, and frying oil in succession. On top of that, packaging, logistics, and delivery platform expense have added to the pressure to raise prices, but the chicken industry appears to have shifted to a wait-and-see mode.
BBQ led the move. On the 20th, BBQ said it is true that price hike pressure has grown as raw and subsidiary material expense rose, but it will not raise chicken retail prices or the supply price to franchisees. The company also said the headquarters will shoulder the increase in expenses.
Rival companies have since said they also have no plans to raise prices, spreading a price-freeze stance across the industry. A bhc official said, "We have no plans to raise prices," adding, "From the year before last to last year, the headquarters absorbed about 50 billion won in increases to raw material supply prices. As we are still bearing this, we also have no plans to raise the supply price to franchisees." Kyochon Chicken also says it has no plans to raise chicken prices.
Some analysts say the decision reflects awareness of the backlash from past chicken price hike controversies. Chicken is a quintessential national snack and an eating-out substitute, and consumers are particularly sensitive to its price. In fact, after Kyochon F&B, which operates Kyochon Chicken, raised prices on key menu items in April 2023, that year's sales fell to about 445 billion won, down about 14% from the previous year. In 2022, BBQ Chairman Yoon Hong-geun also drew public ire after saying in a YTN radio interview that "chicken should cost 30,000 won."
An official in the chicken industry said, "Judging by the increase in raw and subsidiary material costs alone, there is ample justification for a price hike, but if you raise prices first, you have to accept risks such as demand outflows and worsening public opinion," adding, "Conversely, if competitors freeze chicken prices and you alone raise prices, you will inevitably become a 'national punching bag.' In severe cases, there could even be boycotts."
Government policy is also cited as one reason BBQ announced a preemptive price freeze. Recently, the government has continued to urge restraint on price hikes for staple foods such as ramen and bread. Some items, including ramen, have even seen price cuts. With price stability emerging as a key policy task, chicken appears effectively under the same pressure, given that it is an eating-out item with high consumer sensitivity.
A food industry official said, "Even without direct government mentions like with ramen or bread, the strong perception of chicken as a staple food puts it in the same category," adding, "Touching prices at this time could be read as running counter to government policy, and companies are unlikely to take that risk to raise prices."
The industry expects the price-freeze stance to continue for the time being. A franchise industry official said, "Looking only at costs, we have already reached the point where a price hike is unavoidable. For now, it's about holding out because it's the wrong timing to raise prices," but added, "If any one player moves first to raise prices, the current mood could change in an instant."
Inha University consumer studies professor Lee Eun-hee said, "With the government strongly committed to stabilizing food prices, items with high purchase frequency like chicken have no choice but to be more cautious about price hikes," adding, "Even if the supply price to franchisees is frozen, the structure allows different prices by store, so consumer prices could rise in some areas. The headquarters may also convey a message to franchisees to refrain from raising prices."