Many people who live in the middle and lower socioeconomic classes depend heavily on fast food to provide great deals that allow them to feed their families. But what happens when prices go up and are out of their budget?

The other day, my friend went over to KFC with his mom. 

He planned to get a bucket of chicken.

But he didn’t look up the prices.

I mean if you’ve gone to KFC many times, you probably know what the price is going to be.

It would probably be the same as what you paid at Jollibee, El Pollo Loco or even Popeyes, right?

Well, my friend hadn’t been there for a few years, so when he and his mom took a look at the menu, they were in utter shock.

$30. 

THIRTY ENTIRE DOLLARS.

Just for an eight piece meal (albeit it had sides of mashed potatoes, macaroni and cheese, and four biscuits) it was $30!

He did the math. Was this $3 a piece? $2 a piece? After doing some more research, he came to find that his meal came out to $2.50 for each piece of chicken.

Is that even okay?

KFC's prices have been at $30 for the eight piece meal for a while. However, just recently, they released a promotion for an eight piece bucket at $10 across the nation, if you were to source the deal online or through the app. If you were to walk into the store without the app in hand, you wouldn't be able to get the deal.

That means a lot of families still aren't able to get the savings that the $10 deal offers due to technological barriers and other challenges that people who are elderly, from ethnic communities or are struggling at a lower socioeconomic level and living in a food desert are able to get access to. So while their efforts to curtail the high price of their standardized 8 piece bucket at $30 by offering a $10 deal are honorable, they might not just be as helpful as the brand thinks it is.

People in these groups tend to find coupons in their mail. They might have a phone that doesn't have a full display and internet browser that many of us are accustomed to, which makes them unable to cash in on deals like this. And due to the limitations of how new deals are offered, this technological barrier could be preventing a lot of homes from being fed with the chicken that they have grown to love and adore over the years.

KFC is meant to feed the everyday family, not the filthy rich.

Not to mention that if you walk into KFC without the app and without ordering online, you're still going to probably end up walking out with that 8 piece meal at $30, as opposed to just getting 8 pieces of chicken for $10, ultimately losing $10 on the trip.

This deters a lot of families from going to their favorite places, and since the standardized menu item is listed at $30, it also means that the deals could ultimately end up going away at any time, as the meal is officially $30, while the temporary promotion is $10 for the 8 piece bucket.

So I did a little more digging about the chicken and egg industry in its entirety. Was this an anomaly or is it affecting the entire industry at large? 

Before we get into chicken, let’s start with the eggs.

In early 2023, the supply of eggs and chicken products took a massive hit, due to a surge in avian influenza that eradicated upwards of 50 million chickens, putting tremendous stress on the industry.

You’d think that this would mean a wholesale increase of all egg and chicken products, but the answer is, a bit staggeringly, both yes and no. Eggs are definitely more expensive than years past, but somehow, chickens are not. At least, not with any consistency. In some places, yes, but in others, the effect is minimized.

Before the pandemic, a wholesale restaurant provider like Sysco was shelling out a 40lb box of chicken for $40 (approximately $1/lb), but it spiked as high as $140 during Covid-19, before returning to its current price of $70 (at the time of this writing, the national average is $1.83/lb., with prices fluctuating by region).

And certainly, it has increased in a way. 25 years ago, chicken was 18¢ a lb. That’s a 90.21% increase, or a $1.65 difference in value. This is due mostly to inflation, but also higher prices overall, as demand continues to grow and sales are guaranteed.

As a restauranteur of a quick service concept, we did all we could not to raise menu prices,” says Dan Hattori of AdvisorCheck. “We would absorb the regular wholesale food price variances without passing it on to our customers. Sure this ate into our margins at times, but the retention of our loyal customers was more important than turning a huge profit.

The wholesale price spike in chicken was unique and coupled with overall price increases in other aspects of the business, like labor costs, we would have had to increase our prices.

Understanding that the chicken increase was temporary, but drastic and other increases were more permanent, we would have raised our prices in line with the more permanent inflation driven factors and then included a special surcharge for chicken. When chicken prices normalized, we would have then eliminated the special surcharge. I think this was the fairest to handle such a drastic but relatively short lived chicken price shock without totally eliminating our profit margins,“ Dan continued.

While some restauranteurs adjusted for inflation and then readjusted when prices went back down, it seems others haven’t. 

Drawing on a couple recent anecdotal examples: an associate who owns a restaurant recently purchased 40 pounds of chicken for $20 at Costco Business Center, which comes out to 50¢/lb. Yet, at this same time, an 8-piece chicken meal at KFC is upwards of $30. 

Why is KFC able to charge more for their chicken than Jollibee (10pc chicken w/ 3 sides is $22), El Pollo Loco (8pc w/ 2 sides also $22), and most other fast food retailers? Even accounting for the increased size of chicken breasts/legs over wings, the price of eating KFC is five times higher.

The Weird Things About Chicken Prices

To analyze why chicken prices have been weird lately, we’ll need to look at the situation from a few different angles.

COVID-19

Let’s begin with the most obvious aberration in recent years: the onset of COVID-19. The COVID-19 pandemic had a significant impact on the price of chicken between 2020 and 2023, as it disrupted global food supply chains, leading to changes in consumer behavior and production patterns, which in turn impacted the price of chicken.

In 2020, the pandemic led to a surge in demand for chicken as people stockpiled food, causing prices to rise. However, this increase was short-lived, and by the end of the year, prices had more or less stabilized at $3.40/lb. 

Health Trends

In 2023, chicken has become one of the most expensive proteins to purchase in the United States. While beef prices have remained relatively stable (beef and veal is down 3.6% since last October), the cost of poultry products have seen a sharp increase over the past several years. This has left many consumers scratching their heads and asking why chicken is so much more expensive than other proteins like beef? 

One suggestion for this price discrepancy lies in changing consumer trends. As diets shift away from red meat (beef, pork, lamb, etc.) and towards plant-based foods, demand for poultry products has surged. Despite significant investments in agricultural technology, production levels are unable to keep up with growing demand. This imbalance between supply and demand leads to higher prices at the grocery store. 

The Cost of Chicken Feed

Peering further down the line, our research indicates that another reason chickens, and especially eggs, cost so much at the beginning of 2023 is that on top of everything else, the cost of the feed used to raise fouls has also skyrocketed. This has left many chicken farmers struggling to keep their businesses afloat. According to experts, this increase in cost is due to a combination of factors such as climate change, extreme weather patterns, and an increased demand for poultry products, as we discussed above. As global temperatures continue to rise and food shortages become more common in some regions around the world, the price of grain-based feed ingredients has spiked significantly.

Furthermore, production costs have also risen due to new government regulations that aim to improve animal welfare standards. Although these regulations are necessary in order to protect animals from cruel practices, they can be difficult for small-scale farmers who do not have access to financial resources. Additionally, the high cost of transporting feed ingredients across long distances has also contributed significantly to the increasing expenses associated with chicken feed in 2023.

Why KFC Prices Are So High

KFC has become a household name in the fast-food industry and it’s no surprise why. In 2023, KFC is still able to charge so much for their chicken due to the company’s superior quality and convenience, especially by fast food standards (KFC stocks are up 12.57% over the last six months, currently sitting at $131.63 at the time of this writing, which is a sizeable jump from the $116.19 back in August).

KFC has become known for providing top-notch customer service, staying up-to-date on technological advancements, and ensuring that all ingredients are of the highest standard. As a result, customers know they can trust KFC with their orders and this trust creates a strong sense of brand loyalty. If you’re reading all of this and you think “KFC isn’t that good,” then that’s fine. But our point is that they’ve been a mainstay since 1952, and they’ve climbed to the top of their particular service industry. They can charge higher prices because their competition either doesn’t have as much punching power as a business, or doesn’t compete directly enough to take away a significant amount of sales.

In 2020, KFC had franchises spread between 147 countries and territories, and made up over half of parent company Yum Brands’ global sales. The next closest competitor on the fast food market is Popeyes Louisiana Chicken, with only 3,451 stores open internationally, versus KFC’s 25,000+. Love them or hate them, KFC has enough control of the market that they can charge a bit higher than others.

KFC Versus The Grocery Store

Restaurants like KFC will purchase items like chicken in bulk, which they will then oil up, fry, and sell for retail. Because they have to turn a profit, it makes sense that the retail value they sell chicken for is higher than the cost of chicken when they purchase it.

When chicken was $140 on the wholesale market, it was reasonable to charge $30 for an eight piece meal. However, as prices have come back down from the wholesale level, one should expect to see those same savings passed back down to the consumer as well. Yet, that is not reflected in the current price of the 8 piece meal at KFC. 

If you subscribe to a Costco membership, you can easily land a whole rotisserie chicken for $5. At Ralphs, Vons, and Albertsons, it’s $8.99 across the board, assuming no sale is applied. Chicken doesn’t cost as much as KFC makes it seem, as determined by most major grocers.

In short, KFC is taking in bigger margins than they did before the pandemic. As wholesale prices came back down, the retail prices should have followed suit, but instead the retail prices remain high, and they’re pocketing the difference by price gouging the items on their menu.

What If the Cost of KFC (and Chicken Elsewhere) Is Affecting My Ability to Feed My Family?

Prices have increased across the board. It’s fair to say that many households are ending up with more month at the end of their money, considering the increase in cost in both types of gas, along with additional food items. 

Food scarcity is a real thing and we understand that. If you live in a food desert or are used to depend on fast food places to feed your family due to their inexpensive prices, there are some things you could consider doing to counteract this.

While KFC may have been a staple before, consider going to El Pollo Loco ($22) or Jollibee ($22) instead. Other things you could consider doing as well is downloading apps for your local grocery store and shopping locally with the digital coupons that are provided and cooking meals instead. Taking the time to even start up a side hustle might counteract the pressure from the economic landscape we are currently in as well. Meeting with a financial advisor can also give you an opportunity to go over your entire budget at large, to see where each dollar is actually going, to potentially charter you off into the right direction not only for today, but for what is to come. Prices may continue down this path throughout our future as well.

How Will Chicken and Egg Prices Look in the Future?

Assuming we don’t have another outbreak of avian flu that drops us by another 10% of laying hens (the approximate amount that was lost in the first outbreak), we can expect chicken and egg prices to balance out a bit. We’re not promising anything about KFC or other fast food markets, as they must contest not only with all the production hiccups, but their competition with one another on the B2C market.

That said, while prices should drop, it may take a bit. Rodney Holcomb, an agricultural economics professor out of Oklahoma State, had this to say on the matter:

“Unlike broilers, which come in with a bunch of new chicks and within six weeks or so they’re fully grown and ready to be processed and eaten, laying hens take months before they reach their laying potential.”

We’re looking at approximately ten months of refractory time before new hens reach peak maturity, putting producers at a semi-permanent decline for the foreseeable future.

“Knock on wood, as long as we can avoid another avian flu outbreak like we had last year, then we should see egg prices go down to — not the normal or preferred price — but maybe the inflation-adjusted ‘new normal’ price,” to further quote Holcomb’s expertise on the matter.

We appreciate the honesty, as the jury is still out on whether or not inflation will abate in the coming months. Some sources suggest inflation is pumping the brakes a bit, while others provide the insight that while yes, the rate of inflation’s increase is slowing down, that doesn’t mean inflation itself is pulling back at all.

All of this is to say, you should prepare your wallet for some more hurt in the future, as inflation and chicken product prices continue to hold the course.

When The Problem Isn’t Just the Chicken

It’s important to stay educated on all the things that cost you money. However, because of that, the problem isn't necessarily that chicken is too pricey (even when it is), but a fear we have inside of us that we are unprepared for growing prices and other financial avenues of our lives.

If you spend a lot of time fretting about your financial health — whether that’s how you’ll pay your next month’s rent, or how you’ll equip yourself for financial growth ten years down the line — then you owe it to yourself to invite the assistance of a trained financial advisor into your life. From budgeting insights to planning out your financial goals, a financial advisor is your ticket to an improved sense of financial awareness. Find your advisor through our intuitive search tool or sign up for a free AdvisorCheck membership to get our financial resources to get your life back on track delivered straight to your inbox.

And try buying Raising Cane’s next time you get the munchies for some fried chicken. Let’s stimulate KFC’s market competition, together.

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Written by Cooper Barham

Fact checked by Billy Quirk

Reviewed by Luke Jara

Disclosure

The information provided in this article was written by the research and analysis team at AdvisorCheck.com to help all consumers in their financial journeys, by providing the resources and the insights to help improve one’s financial health, make it through recessionary and inflationary periods of time, and save their earnings to use them towards building a secure financial future. 

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