McDonalds, Yum break ties with Chinese supplier over food safety concerns
Published By : 21 Jul 2014 |Published By : QYRESEARCH
McDonald’s Corp and KFC-parent Yum Brands Inc have decided to break ties with a Chinese meat supplier owing to food safety concerns. The U.S. fast food chains apologized to its Chinese customers after the supplier was shut down by state regulators.
It was suspected that the Chinese branch of OSI Group LLC had been supplying meat (chicken and beef) to clients including McDonald’s, Yum’s KFC and Pizza Hut well beyond their expiration date. The local government is investigating the matter and meat products of the supplier have been seized.
Illinois-based OSI has more than 50 production units across the globe and recorded revenue of over USD 5 billion in the year 2012. McDonald’s has been in China since 1992 and Yum since 2008 and both the fast food chains had been hit by a food safety scandal in the country in 2012. The profits of Yum had sharply declined after the incident and the current situation is sure to challenge its place in the China food market.
As far as sales are concerned, both Yum and McDonalds’s have been the leading fast food chains in China but have been facing competition from local firms.
McDonald’s, KFC and Pizza Hut have asked its China outlets to stop using products from Shanghai Husi Food Co.