The high cost of chicken wings is forcing heavy buyers of the restaurant staple to rethink how they can meet demand without sacrificing margins. It comes down to skirting the two-per-bird limit.
Here’s how some chains are finding new ways to skin a chicken, so to speak.
1. Wingstop’s ‘split menu pricing’
With wing costs running 11% above prior levels, the quick-service chain is testing what it calls a split menu. Customers in the Las Vegas market now see one price for bone-in wings, the chain’s signature, and a much lower price for boneless wings, which are also less expensive on a wholesale basis. Wingstop hopes to lead patrons to buy more boneless wings and skew the sales mix, which is currently tipped toward the bone-in variety by roughly a 2-1 ratio.
The arrangement should also avert sticker shock if Wingstop raises the price of bone-in wings, said CEO Charlie Morrison. If the new price is off-putting, patrons can shift to the all-meat variety, he suggested.
“As we move across the country we will establish what we think is the appropriate price differentiation between the two products,” he told financial analysts. “But in our initial testing and rollout, we have not seen that it's had an impact negatively on the check.”
Morrison noted that the chain does not foresee any decline in wing prices in the near future.
Las Vegas is also the market where Wingstop is testing delivery.
2. Quaker Steak & Lube’s Bangin’ Drums
The casual-dining chain started promoting an oversized alternative last month to its Jumbo Wings: Bangin’ Drums, or chicken cuts that are three times meatier than a wing. Promotional materials suggest the sauced “wings” are actually drumsticks, and hence the sly name, though Quaker Steak never comes out and says as much.
Because of the chicken pieces’ size, an order consists of three Bangin’ Drums and sells for $7.49.
3. Diversified Restaurant Holdings’ new halving
Buffalo Wild Wings’ largest franchisee is trying its own way of dealing with skyrocketing wing prices. Like the rest of the system, 64-unit Diversified Restaurant Holdings has found a chainwide offer of half-priced wings to be a powerful customer draw on Tuesdays, a normally slow night. But the traffic bump comes at a high margins cost.
So Diversified is limiting the wings offer to two serving sizes, snack and small, and recasting the deal as a buy one, get one free setup.
“The early results are promising, with higher same-store sales for that day of the week and a much more attractive margin profile,” said CEO David Burke.
The company has asked Buffalo Wild Wings to roll the BOGO into all of its restaurants in Michigan.
4. Buffalo Wild Wings’ new weekly calendar
Buffalo Wild Wings, Diversified’s franchisor, is also experimenting with a switch from half-priced wings to a BOGO deal. But the corporation is going one step further in its company-oriented restaurants and offering the discount on boneless wings.
It’s easy to see why. Boneless wings have a food cost of about 20%, compared with a cost in the high thirties or low forties for bone-in wings, according to Diversified’s Burke.
The problem for BWW is that it already offered a boneless wings promotion, a deal on Thursday nights. CFO Jim Schmidt said the half-priced boneless wings will still be offered on Thursday until the chain gauges the effect of offering BOGO boneless wings on Tuesday.
BWW said the outlook for wings isn’t encouraging. The chain expects costs to run around $2.13 per pound during the first two months of this quarter, a 24% premium over what its restaurants were paying a year ago.