Industry News | August 1, 2012 |
Burger King's Bevy of New Menu Items Drive Q2 Sales
Burger King launched the largest expansion of menu items in the U.S. in the brand’s history during the company’s second quarter, said Steve Wiborg, president of Burger King’s North America division. Speaking to investors on August 1, he said 13 new menus items designed to broaden appeal and close gaps in day parts included the two stellar market performers in beverages: smoothies and frappés.
Wiborg said the company sold 18 million smoothies and 10.5 million frappés in the U.S. in April and May. It’s part of the company’s new strategy to launch limited-time-only products with a common theme, while also utilizing new product platforms. Yet, “there’s no silver bullet,” he said.
Referring to the company’s aggressive drive to accelerate the pace of international store growth, Daniel Schwartz, CFO of the brand, said the company has made good progress in establishing partnerships in high-growth markets. He told investors a joint venture in the Russian market is committed to opening hundreds of restaurants in the next few years. The iconic chain also expects to see 1,000 joint-venture stores open in China within five to seven years.
System-wide sales growth shot up 6.4 percent in the quarter, year over year, while comparative system-wide sales increased 4.4 percent, year over year, Schwartz said. System-wide restaurant count increased 2.2 percent over the same quarter a year before. The quick serve also returned to the New York Stock Exchange on June 20th.
Bernardo Hees, CEO of the burger chain, said the company had rolled out a host of initiatives spanning virtually every aspect of operations, including menu development, marketing, and operations.
The company’s summer barbeque promotion—the biggest menu launch in the company’s history—met management’s expectations, and Schwartz said the company’s chicken strip and wrap offerings boosted chicken sales by more than 20 percent, quarter over quarter.
“Despite the success of new beverage and chicken platforms, we remain highly underpenetrated in a number of menu categories, with the potential to introduce new products on the platform that we now have in place,” Wiborg said. Burger King has also made a “meaningful” investment in marketing designed to attract more seniors, and initial results were encouraging, he said.
By Jan Fletcher
Food & Beverage
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