The Thai fastfood sector was heating up this week, as Burger King reiterated its threat to the Thai International Fast Food Company (TIFF) of legal action because it unilaterally ended a franchise deal with the burger giant in favour of developing a string of Pizza Huts across Thailand.
Burger King, which made no attempt to hide its anger, revealed in a statement yesterday that it would sue TIFF in the Intellectual Property and International Trade Court with a view to forcing in to carry out the original agreement and focus attention on the outlets of the burger chain rather than its pizza-making rival.
Tricon Global Restaurants, which operates Pizza Hut, may also face legal proceedings for signing the deal with TIFF and the Central Group, both owned by the Chirathivat family. “Burger King Corp will take action against any third parties who seek to interfere with those contractual arrangements,” threatened the statement.
TIFF has defended its decision to close the outlets one by one, maintaining that Burger King is simply not a good business in Thailand. The consumer preference for fish over meat does not help sales of the fastfood chain’s flagship product, the Whopper, and Burger King allegedly refused to add more chicken and fish to the menu as a concession to local tastes.
So far, nine have been closed down, at Fashion Island, Seacon Square, Pattaya, Fortune Town, Kad Suan Kaew, Chiang Inn, Pin Klao, Wong Sawang and Chid Lom. There are plans to close five more during this year.
Burger King stated that it “will […] exercise its rights to purchase the assets and take over the leases for the majority of the remaining Burger King restaurants operated by Thai International Fast Food in the event of their closure. It will also vigorously defend its right to do so in the event that Thai International Fast Food acts contrary to these rights.”