Both chains are seeing generally weak sales in their home markets. At Burger King, same-store sales rose just 0.5% in the U.S. in the second quarter, parent company Restaurant Brands International (RBI) said Friday.
That’s considerably slower than rival McDonald’s, which generated 5.7% same-store sales in the period, and badly lags the chain’s international units, which enjoyed 6.5% growth in the key industry metric.
Into that weakness steps the company’s introduction of the Impossible Whopper, slated to take its place as a limited-time offer at the chain’s 7,000 U.S. units next Thursday—just four months after Burger King first started testing the product in a single market.
Early results from St. Louis were particularly strong, according to Restaurant Business sister company Technomic, helping to explain Burger King’s rapid adoption.
“Our teams found in the research that there was an opportunity to address a real strong and growing demand in our business at Burger King,” RBI CEO Jose Cil said during the company’s second quarter earnings call on Friday. “We saw the same thing with Tim’s in Canada, because guests are demanding and looking for more options and alternatives.”
Tim Hortons in Canada may be in a more difficult situation. The chain’s same-store sales rose 0.7% in its home country, where the chain is something of an institution and dominates the breakfast business.
That is a frustrating result for a chain that has taken numerous steps to lift sales, including a new loyalty program that is already highly popular in Canada and is involved in about half of the chain’s transactions.
In June, the chain launched a trio of breakfast sandwiches using the plant-based Beyond Meat product. In July, Tim Hortons introduced Beyond Burgers—branching out beyond the chain’s traditional menu of sandwiches and baked goods.
The company said that the Beyond breakfast sandwiches are “performing well and driving healthy levels of incrementality.”
But executives were more restrained in their comments on the Beyond Meat burger at Tims.
“We looked at the Beyond Meat burger as a kind of limited-time offer to see how [customers] would react,” Cil said. “We’re encouraged by some of the behavior, but in the end we are really a coffee and baked-goods business with a very strong sandwich offering and soups and other products that are natural in our restaurants.”
Cil said that Tim’s breakfast platforms, notably Omelette Bites, performed well during the second quarter but the chain now faces softness at lunch. Sales from some of items, such as a value chicken sandwich and an Oreo Iced Capp, did not perform to expectations.
The company said that it is working to lift sales in the afternoon, but executives also defended the chain’s performance.
“We have a really, really good business,” Cil said. “We have amazing restaurant owners. We have very, very loyal guests that come very frequently. We sell eight out of ten cups of coffee in Canada in our restaurants. What we try to do is build on that over the long haul to create an even stronger business, and I think the initiatives that we’re working on are things that are not flashes in the pan.”
As for Burger King, the gap in performance between domestic and international locations was notable.
Executives said one problem in the U.S. was a lack of effective value messaging, something the company believes it is addressing with the $1 taco introduced last month. “We did not have strong enough offers and messaging throughout the quarter,” Cil said.
“We do best at Burger King in the U.S., and, really, with Burger King across the globe, when we have a good balanced offering,” Cil added. “We occasionally have a bit of imbalance on media allocation and maybe some of the promotional activations were not as strong as they could have been, but we feel good about the plans we have long term.”