China food safety

Shanghai orders foreign fast-food chains to name suppliers on websites

McDonald's and Yum among companies meeting a request by Shanghai authorities

PUBLISHED : Tuesday, 12 August, 2014, 3:11am
UPDATED : Tuesday, 12 August, 2014, 10:29am

Five fast-food chains including McDonald's and Yum Brands have published details about their suppliers on their Chinese websites following a request from Shanghai authorities after a food safety scare.

Shanghai's Municipal Food and Drug Administration said on Saturday that it had asked the two chains, along with Burger King, Dicos and Carl's Jr, to publish the usually confidential information as part of government efforts to strengthen its oversight of food suppliers.

The five firms were among a range of companies that used meat from Shanghai Husi Food, a unit of US-based OSI Group, which was alleged by a television report to have improperly handled meat and used expired food.

Benjamin Cavender, a Shanghai-based analyst at China Market Research Group, said food chains were generally reluctant to publish supplier lists because they did not want their competitors to know where they sourced their food.

It's probably smart for the companies to do this ... to send a clear message
Analyst Benjamin Cavender

"In this case it's probably smart for the companies to do this because they want to send a clear message that they are being transparent both to the government and to their customers," he said.

"But in reality, for the situation to truly get better there's going to have to be stricter oversight directly over the suppliers and that cannot just be coming from the brands, it also has to come from the government."

The food scare involving Shanghai Husi is testing local consumers' loyalty to foreign fast-food brands.

Yum said earlier this month that the scare had a "significant, negative" impact on sales at its KFC and Pizza Hut restaurants across the country. McDonald's on Friday said the food scandal had put its 2014 global sales forecast at risk.