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Devyani International, the largest franchisee for Yum Brands (KFC & Pizza Hut) in India, has outrightly said that they won’t reduce prices. While, that of Domino’s Pizza had dropped a hint that they wont be reducing prices at least in near term.
Pizza will continue to burn a hole in your pocket. Master franchisee of both Pizza Hut and Domino’s in India have given indication that they won’t reduce prices at least in the near term. Both have sighted elevated ingredient prices behind their view. Prices of milk and cheese which are major ingredients in preparation of pizzas have increased drastically in the last one year. Pizza Hut’s master franchisee has outrightly said that they won’t reduce prices. While, that of Domino’s Pizza has dropped a hint that they won’t be reducing prices at least in near term.
Devyani International, the largest franchisee for Yum Brands (KFC & Pizza Hut) in India, had hiked pizza prices by under one per cent and KFC chicken prices by under three per cent in April, 2023. According to IIFL Securities, in the last 18 months, Domino’s pizzas have become costlier by average of 10%.
Ravi Kant Jaipuria, non-executive chairman of Devyani International, the largest franchisee for Yum Brands (KFC & Pizza Hut) in India, has outrightly said, “We will not reduce headline prices. High inflation has only started to stabilise. Raw material prices are still high. We would rather pass on benefit of input price consolidation in the form of additional offers, promos and value meals.”
While, CEO and MD, Sameer Khetarpal, Jubilant Foodworks, the master franchise of Domino’s Pizza in India, had said, “Cheese prices have remained high in last one year. We will think about pizza price revision only if cheese and milk prices fall below year ago level.
As per CPI Inflation data for June, 2023, milk and products inflation was 8.56%. Milk and products inflation has remained high for quite a long time in the country. In the last one year or so, milk has become costlier by an average of 12 per cent all over India.
Both Jaipuria and Khetarpal said high inflation of ingredients impacted consumer sentiment and demand in last few quarters. In fact, according to Jaipuria, people have shifted to cheaper QSR options as pizzas sold by large QSR chains have become expensive.
But, nevertheless, both didn’t hesitate to add that they expect demand to pick up going ahead.
Both said high raw material prices have begun to consolidate. But since, input prices still remain very high from year ago levels, it doesn’t look like people will get any relief from high pizza and KFC chicken prices. QSR chains are in no mood to roll back prices hikes.