In April 2024, QSR Brands — the operator of KFC in Malaysia and a subsidiary of Johor Corporation — temporarily closed 108 of its approximately 600 KFC outlets across the country. The closures followed six months of a pro-Palestine consumer boycott that targeted US-linked brands after the outbreak of the Gaza war in October 2023. The 108 shuttered stores represented about 20% of KFC's Malaysian footprint.
The boycott hit unevenly. Kelantan, a conservative northern state, was the worst affected, with nearly 80% of its KFC outlets — up to 21 stores — forced to close. Other heavily affected states included Johor (15 stores), Selangor and Kedah (11 each), and Terengganu and Pahang (10 each). By contrast, only three stores closed in Kuala Lumpur and one in Sabah. QSR Brands said affected employees, out of a workforce of 18,000 (about 85% Muslim), were offered relocation to busier outlets.
KFC was not on the official BDS (Boycott, Divestment, Sanctions) list, but many Malaysian consumers associated any American fast-food chain with Israel. QSR Brands responded by adjusting its branding to emphasize local ownership by Johor Corporation, a state government entity. The company cited 'challenging economic conditions' and 'increasing business costs' as the reasons for the closures. The same boycott wave also hit McDonald's and Starbucks operations in Malaysia.
Rebranded as locally owned by Johor Corporation and relocated staff to busier outlets, but perception of being American was enough to close 20% of the network.
A geopolitical conflict halfway across the world triggered a consumer boycott in Malaysia, forcing KFC's local operator to close 108 of its 600 outlets
The brand was hit despite not being on the official BDS boycott list — the perception of being an American brand was enough
QSR Brands' response — rebranding as locally owned and relocating staff — could not reverse the consumer sentiment that had already closed 20% of its network
A brand need not be a target to be a casualty. KFC Malaysia was not on any boycott list, yet consumer perception alone closed 108 stores across a single country.
The closures were described as temporary by QSR Brands, which offered affected employees relocation to busier outlets. The company shifted its branding to emphasize local ownership by Johor Corporation. The broader boycott wave continued to affect other US-linked brands in Malaysia, including McDonald's and Starbucks, whose operator Berjaya Food reported a record RM292 million net loss for the financial year ended June 2025.
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