Should KFC Be Leaving Kentucky?

KFC, formerly known as Kentucky Fried Chicken, ruffled some feathers with news that its U.S. headquarters will be exiting its Kentucky home of Louisville, putting an end to decades of the brand’s history in the state.

The chicken joint’s parent company, Yum! Brands, said KFC’s corporate team will be joining sister brand Pizza Hut’s offices in Plano, Texas.

The relocation is part of Yum!’s broader plans to have just two U.S. headquarters for its restaurants, which also include Irvine, California-based Taco Bell and Habit Burger. Combining KFC’s offices with Pizza Hut in Plano will “foster greater collaboration among brands and employees,” the company said in a press release.

David Gibbs, Yum!’s CEO, said, “Ultimately, bringing more of our people together on a consistent basis will maximize our unrivaled culture and talent as a competitive advantage.” The move is also expected to yield cost savings.

The move comes as KFC, with over 30,000 restaurants worldwide, has been struggling in the U.S. amid fierce competition from Popeyes, Chick-fil-A, Wingstop, Bojangles, Church’s Texas Chicken, and Raising Cane’s as well as from burger chains in the chicken category.

About 100 Louisville-based KFC corporate employees will be required to relocate to Texas over the next six months. Another 90 remote-based workers will also be required to move to the new combined headquarters over the next 18 months as Yum! joins a number of other firms requiring full-time in-office attendance for corporate employees.

Some other fast-food chains have faced backlash when relocating their headquarters, including Chipotle’s move from Denver to Newport Beach, California-born Carl’s Jr.’s move to Tennessee, and Papa Johns’ relocation to Atlanta from Louisville.

However, few brands are as associated with a specific state as KFC. The idea for the restaurant originated in 1930 at a service station stop in Corbin, Kentucky, where Harland Sanders — who became famously known as “Colonel Sanders” — started serving travelers the same fried chicken he grew up eating. He officially founded the chain in 1952 with the opening of the first Kentucky Fried Chicken franchise. After selling the company in 1964, Sanders’ popularity spread due to his appearances in commercials in his trademark white suit.

When Sanders died in 1980, he lay in state at the Kentucky State Capitol in Frankfort, and the state’s flags flew at half-staff. He is memorialized by murals as well as two museums in Kentucky, and his goateed likeness continues to be stamped on KFC restaurant signs and chicken buckets.

Kentucky Fried Chicken’s name was abbreviated to KFC in 1991 in line with a trend toward shorter fast-food chain names and to distance itself from unhealthy associations with the word “fried.”

Local politicians expressed dismay at the headquarters move.

Gov. Andy Beshear said in a statement attained by The New York Times, “This company’s name starts with Kentucky, and it has marketed our state’s heritage and culture in the sale of its product. My hope is that the company will rethink moving Kentucky Fried Chicken employees out of Kentucky.”

Louisville Mayor Craig Greenberg said in a release, according to the Courier Journal, “I am disappointed to learn that Yum! Brands will move its KFC employees to Texas — especially since the brand was born here and is synonymous with Kentucky. I’ve asked to meet with the Yum! CEO soon and am heartened Yum! will retain its corporate headquarters and 560 employees here.”

Alicia Kelso, executive editor at National Restaurant News who hails from Kentucky, described the move as “borderline brand malpractice.” She said that while Yum! will likely gain some “favorable tax and talent benefits” and better leverage synergies with teams closer together, “you can’t take the Kentucky out of the brand, and it could prove challenging for KFC to maintain its DNA from a business park in Plano.”

Recently, many employers have been rethinking the location of their corporate headquarters due to lower taxes and changes to office space needs. With Texas promoting its business-friendly policies like lower taxes and lighter regulation, Chevron, Tesla, and Hewlett-Packard are among the firms that have moved to the state in recent years.

To commemorate KFC’s “deep-rooted history in Kentucky,” Yum! is giving a $1 million endowment to the University of Louisville College of Business and building a flagship restaurant in that city. The company also reiterated that its own corporate offices, as well as the KFC Foundation, will remain in Louisville.