Industry News | November 7, 2008

How the Wendy's 99 Cent Menu Will Save Smith

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According to Roland Smith, president and CEO of Wendy’s/Arby’s Group, the company is focused on growing sales, store-level operating profit margins, and cash flow now that the merger is complete. "We have demonstrated the ability to drive superior profit margins in the past and are committed to building on that track record," he says. "Our immediate focus is to grow profitable transactions, run a lean and efficient organization, and capture synergies available to the third largest quick-service restaurant company in the U.S. with more than 10,000 restaurants system-wide."

“At Wendy’s, we plan to re-establish the brand’s premier quality positioning and take aggressive steps to grow sales and improve restaurant operating margins,” Smith says. “We are encouraged that Wendy’s same-store sales improved throughout the third quarter as we introduced an effective value offering in September featuring our great-tasting Double-Stack Cheeseburger, the Crispy Chicken Sandwich, and the Junior Bacon Cheeseburger--all at a 99 cents price point.

September same-store sales were positive and October results were even better as we featured new Flavor-Dipped Chicken sandwiches, reinforcing the premium quality of Wendy’s tender center cut chicken fillets.

“Arby’s same-store sales results during the quarter were indicative of the challenging operating environment and a decline in customer traffic, which primarily reflected aggressive price discounting and coupon offers by competitors,” Smith says. “To restore momentum, we are focused on Arby’s core customers and, specifically, the appeal of our premium roast beef products and toasted subs. We believe that the inherent strength of Arby’s quality brand positioning, more targeted advertising and new products aimed at our core customers will lead to sales growth and improved operating margins.”