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Wendy’s breakfast menu could overtake Burger King two years after its launch

Breakfast Baconator and Seasoned Potato are part of the breakfast menu at Wendy’s Restaurant in New York City on March 2, 2020.

David Deedergado | Getty Images

Two years ago, Wendy’s launched a breakfast menu nationwide, tried for nearly 40 years, and eventually crossed the finish line to reach its failed goal. After that, the blockade of Covid took place.

Before the pandemic, breakfast alone attracted many customers to the fast food chain. Lunch and dinner traffic was declining as consumers chose healthier options and dine at home. For Wendy’s, a hamburger chain is available at breakfast. To attract new sales without stopping the traffic for lunch, snacks and supper.

Despite Covid’s establishment, Wendy’s stuck to the plan and offered egg sandwiches and breakfast burgers when rival restaurant chains opened later or reduced early morning offers. Behind Burger King and the dominant McDonald’s at Restaurant Brands International.

By the fourth quarter of 2021, breakfast sales accounted for about 8% of Wendy’s US sales, but still below the chain’s target of 10% of total US sales. Last year, the company increased breakfast sales by about 25%, Wendy’s believes. There is room for growth during the day. In 2022, hamburger chains expect breakfast sales to increase by another 10% to 20%.

In an interview, US President Wendy’s Kurt Kane said, “For us, for now, we are very solid and quickly ranked in third place, but we are just behind Burger King.” Said. I am confident that by leaving them behind, we will be able to do it here in the not too distant future. “

Burger King’s US business has been struggling in recent years, and poor breakfast performance hasn’t helped. Burger King’s US same-store sales in the fourth quarter increased by just 1.8%, following both McDonald’s and Wendy domestic market indicators.

And while McDonald’s is still the dominant player in the early morning hours, Kane said he thinks Wendy’s could eventually become number one.

“I think Frozen Arches has had enough time at the top of the breakfast category, but I think it will obviously stop it and continue to steal share across the rest of the category,” he said.

In late February, Wendy’s announced that it would offer a breakfast menu to all Canadian restaurants this spring.

The company’s stock has risen 7.6% in the last 12 months to a market value of $ 4.76 billion. Shares are below S & P 500, but above McDonald’s and Restaurant Brands International.

Become a pandemic winner

Wendy’s breakfast was only available nationwide for about two weeks before state and local governments instructed restaurants to close their dining rooms and serve meals in deliveries, takeaways, and drive-through lanes.

According to Kane, the company discussed options with the franchisee to change the breakfast plan after the blockade took place, but their operators promised to maintain momentum.

“We got off to a great start, far beyond what everyone could have expected in the first two weeks,” Kane said. There are many fans throughout the process. “

Wendy’s designed the first two and a half hours of breakfast service to be drive-through only, so it just survived the competition.

In addition, Wall Street analysts expected fast-food rivals to step up their own breakfast deals and advertising to maintain customer loyalty. Snort.

Wendy’s has had the opportunity to spend more on marketing and increasing awareness.

Not only did the pandemic influence competitors’ marketing plans, but some fast-food restaurants stopped selling early-morning meals due to staffing issues and maintaining profitability. Many Taco Bell locations only opened after breakfast and resumed their previous schedule. September of this year.

Still, Wendy’s is unaffected by some of the pandemic pressure points. Like the broader restaurant industry, franchisees are suffering from staff shortages, but Kane said efforts to recruit more workers prior to the launch of breakfast helped.

Routine changes

The timing of Wendy’s breakfast launch gave consumers the opportunity to start a new morning habit, just as the rest of their daily routine was upside down.

“It wasn’t the way we created a playbook, but it could have really helped us because it gave us the opportunity to steadily create it.” Kane said.

Many consumers have stopped commuting to the office or school, changing their breakfast habits. After years of decline, cereal and orange juice sales surged, but restaurant demand for breakfast dropped significantly. For example, Starbucks has seen many customers. Choose coffee after lunch instead of a morning cup to delay your visit.

Before the pandemic, Wendy’s expected consumers to be the busiest time to go to work from 7am to 9am, but instead, the company had the longest breakfast in the last 30 minutes of service. I saw the line.

Of course, as more consumers return to their offices and schools, the pattern is changing again.

“The pattern is different, but breakfast mobility has returned significantly to its pre-pandemic state,” he said.

From September to November According to The NPD Group, online and face-to-face traffic to restaurants during breakfast time increased by 11% compared to a 10% decrease in the year-ago quarter.

When early rising customers returned, Wendy’s took advantage of aggressive promotions to increase traffic to restaurants and raise awareness of breakfast servings. From November to mid-December, we chose sausages or bacon to sell egg and cheese biscuit sandwiches. Kane said he expects similar deals in the coming months.

The chain also recently launched a hot honey chicken biscuit, the first addition to the breakfast menu since its debut. This is a play of honey chicken biscuits associated with a breakfast baconator as Wendy’s best-selling breakfast item.

But between the favorites of the two crowds, Kane has a clear favorite. He claims to have eaten 720 breakfast baconators since its official launch.

“Some days you get two, some days you don’t get anything, but you need to balance,” Kane said.

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