KFC’s U.S. performance has struggled of late, so much so that executives with parent company Yum Brands have barely mentioned it on earnings calls. That continued on Thursday, when executives didn’t even mention the chain’s domestic results, which included a 5% decline in same-store sales in the fourth quarter.
But they did mention one thing: Saucy.
KFC’s chicken tenders concept, which opened in Orlando last month, is apparently doing quite well, executives said on Thursday, enough to give them confidence to open a few more.
“Early engagement has been promising, reinforcing our belief in Saucy’s potential to drive sales and enhance brand relevance,” Yum CEO David Gibbs said.
He later added that initial results from Saucy “to put it mildly, have been very encouraging.”
To be sure, it's just one location and a location that has been buoyed by considerable media attention. The company plans to open more locations of Saucy to see how it could fit into the brand over the long-term. “We’re going to expand that test pretty dramatically this year to try to get a better read on how elements of that, or how that solution would play for the KFC U.S. long-term business,” Gibbs said.
Saucy isn’t the only new concept that Yum Brands is testing in the U.S. KFC sister chain Taco Bell opened the beverage-focused Live Mas Café, which focuses on beverages such as Chillers, Agua Frescas and specialty coffees. Gibbs called it an “in-store beverage-focused café,” but like Saucy, Yum Brands plans more of them to help it understand its long-term growth potential.
Numerous restaurant chains over the years have tested and tried secondary concepts in a bid to seek out growth. That appears to have accelerated among major fast-food brands of late.
McDonald’s, for instance, launched a test of its own last year in CosMc’s. That brand started as a single location in Illinois, but several locations were subsequently opened in Texas last year.
Yet early success for such tests doesn’t necessarily translate into long-term results. McDonald’s has since closed three of the larger-footprint Texas CosMc’s locations and now plans to focus only on smaller locations.
For KFC, Saucy could provide a boost to a business that has struggled for years as consumers shifted to boneless or handheld chicken products.
KFC’s domestic business has fallen behind a number of competitors, including the chicken sandwich chain Chick-fil-A and more recently longtime rival Popeyes. Meanwhile, the chicken fingers chain Raising Cane’s is surging and is on pace to surpass KFC in terms of system sales by the end of 2026.
The chain just named Scott Mezvinsky its global CEO. The former Taco Bell executive started with KFC U.S. 20 years ago, Gibbs noted. “He’s got a lot of thoughts about ways to strengthen that business,” Gibbs said. He mentioned “modernizing the business for consumers” and “leaning into digital.”
“There’s a number of things working between digital and concepting and menu innovation that I think Scott will be perfectly positioned to help lead and help refine,” Gibbs said.
Saucy is KFC’s take on a chicken tenders concept and it features 11 different sauces as well as a lineup of 11 beverages, including teas and refreshers. The brand is tech-forward and big on the drive-thru and it already has its own mobile app, which plays to the more modern focus on digital and takeout sales.
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