KFC Ends 37-Year Partnership With Pepsi, Switches to Coca-Cola
Fast-food chain KFC announced it is ending its 37-year beverage partnership with PepsiCo in the U.S. Coca-Cola products will replace Pepsi across all U.S. restaurants by spring, a move seen as significant for Coca-Cola's market strategy.
KFC has announced the end of its 37-year beverage partnership with PepsiCo in the United States. The fast-food chain confirmed this week that all of its U.S. restaurants will transition to serving Coca-Cola products, with the full switch expected by spring.
A spokesperson for KFC stated the change is part of a broader initiative to modernize its menu, expand beverage offerings, and enhance the customer experience. The agreement with Coca-Cola is also anticipated to foster innovation in beverages and food-and-drink pairings.
The shift marks a significant departure, as PepsiCo's relationship with KFC dates back to 1986 when PepsiCo acquired the chain. Pepsi has remained KFC's beverage partner through its subsequent spin-off into Tricon Global Restaurants, now Yum Brands.
This is not the first time Coca-Cola has partnered with KFC. Coca-Cola currently supplies KFC in other international markets, including Indonesia since 2019 and Malaysia since 2022.
Industry experts note that fountain drink contracts represent high-margin items for fast-food restaurants due to low per-cup costs. Therefore, a deal spanning thousands of locations is considered substantially valuable beyond immediate drink sales.