Burger King's operational improvements start paying off

The company’s U.S. same-store sales improved last quarter, driven by its new line of chicken sandwiches and a focus on the Whopper.
Burger King is working to improve operations in its U.S. business. That focus is beginning to pay dividends. / Photograph: Shutterstock.

Burger King’s U.S. same-store sales rose 4% in the third quarter, parent company Restaurant Brands International said on Thursday.

It was the best result for the struggling business since the second quarter of last year and came despite a rapidly evolving restaurant environment. It also continued to narrow the gap between Burger King and its fast-food burger rivals.

The company said that sales grew thanks to its renewed emphasis on its Whopper and higher prices.

Some of it also came from the Miami-based chain’s Royal Crispy Chicken Sandwich line, which the company introduced in August.

That sandwich, Restaurant Brands International CEO Jose Cil said on Thursday, is a demonstration of the method in which Burger King adds new products. The company focuses on “high-quality menu innovation” with core products that “ensure consistent operational execution with minimal disruption.”

The sandwich, he said, “strengthens a core product category, and is a strong, well-tested product.”

“We’re very encouraged by the results,” Cil said. “We’re getting strong volumes with a lot of repeat guests.”

Burger King’s Royal Crispy Chicken Sandwich line in many respects is a microcosm of the changes the brand has been making this year to focus on operations. And it replaces a sandwich that symbolized some of its challenges.

In 2021, Burger King introduced a hand breaded Ch’King chicken sandwich that was well reviewed. The sandwich was designed to compete with a huge number of upgraded, fast-food chicken sandwiches and it did well in tests. Yet it performed poorly overall, leading to weak sales and ultimately the overhaul of the burger chain’s management team.

Parent Restaurant Brands International has since announced plans to invest $400 million in marketing and remodels as part of a broad brand turnaround.

The Ch’King was more difficult from an operations standpoint, which may have played a role in its poor sales. Burger King has since hired Tom Curtis to head North American operations, and one of his primary focuses has been on operations.

The new line of sandwiches was designed to be easier for franchisees to execute.

While Burger King is spending at least $120 million on marketing and more than that on remodels, its focus on improving store operations is considered key to its future. The brand has hired more field staff. The company will also concentrate more of its financial assistance on remodels to better operators and stores where a remodel will generate the most return.

“It’s foundational to the plan,” Cil said in an interview. “To get where we think we need to get to, topline growth, profitability, unit growth, system sales growth, the foundation has to be engaged franchisees, with great looking restaurants.”

In addition, he added, operations involves a lot more these days. “The idea of operations has evolved tremendously,” Cil said. “It’s not just what we used to think about in terms of operations. Digital is becoming more important. There are different service modes. All of this is really foundational to the success of Burger King.”

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