Get ready for a lot more chicken and beverages this year and beyond.
Much of the fast-food world is jumping on those two bandwagons as they work to build sales and compete more heavily with a generation of upstart concepts that are taking enormous share in the restaurant market.
McDonald’s, Wendy’s and Taco Bell have all said that they plan to sell more chicken and beverages, focusing on new, innovative products and partnerships to boost their share of those markets. In some cases, they’re even reorganizing their business to focus more on these areas.
“We’re looking at $250,000 (in revenue) by 2030 for an average store in terms of sales by getting our fair share of crispy chicken, distinctive beverages, fries,” Neil Manhas, global chief financial officer for Taco Bell, said at the company’s Consumer Day presentation earlier this month.
Wendy’s earlier this month echoed similar sentiments. The company is intent on speeding its growth and believes that boosting its innovation around chicken and beverages will help it get there. “Chicken’s a big deal,” Chief Marketing Officer Lindsay Radkoski said.
She provided a few data points to back that up. There were 2.7 billion chicken sandwich servings in the U.S. last year, Radkoski said. Adding handheld chicken like nuggets, tenders or strips, and that servings number jumped to 8 billion, up 16% since 2017.
In the fast-food sector, chicken has been a big deal for years, even if how it’s served has changed. Limited-service chicken sales among Top 500 restaurant chains grew 10.2% last year. Raising Cane’s, the chicken tender concept, generates $6 million per store and is well on its way to being a Top 10 restaurant chain. Wingstop is not far behind, and just came off one of the strongest sales years in its history. Dave’s Hot Chicken, which was created in a Los Angeles parking lot in 2017, is about to be sold for $1 billion to Roark Capital.
Big restaurant chains want a piece of that. McDonald’s just last week announced the creation of a Restaurant Experience Team, including groups that will focus exclusively on burgers, chicken and beverages/desserts, in a bid to compete with some of these “specialist” competitors and get a bigger share of those growing markets.
The company plans to keep reintroducing its Chicken Big Mac and is planning to introduce chicken tenders and bring back the Snack Wrap this year to get its share of the market. “We’re competing against somebody like a KFC, which is single-mindedly devoted to winning in chicken,” CEO Chris Kempczinski said. “So this category team now allows us to have that same level of focus.”
It can also focus on beverages, a rapidly growing occasion and one luring all kinds of competitors. Some of the fastest-growing restaurant chains in the U.S. serve drive-thru beverages, including 7 Brew, Dutch Bros and Scooters. But there are also boba tea concepts and chains like the drive-thru dirty soda brand Swig.
McDonald’s has been testing its CosMc’s concept but could very well implement those beverages into its regular menu at its flagship concept.
Taco Bell, meanwhile, has its Live Mas Café that offers a wide selection of beverages. That’s an in-store concept that could be rapidly expanded to take beverage market share. “Beverages is a really important category, entry point or new occasion for us as we continue to elevate and broaden the brand,” Chief Marketing Officer Taylor Montgomery said this month.
Wendy’s Radkoski noted there are 35 million beverage servings in fast-food every year and the company has Coca-Cola Freestyle machines in its restaurants to help meet that demand. But the company also has craft lemonades and plans to test several new beverages this summer. It also wants to build its coffee and energy offerings around breakfast.
“Our next horizon of growth at breakfast is in beverages,” Radkoski said. “We are building a strong beverage lineup for consumers in the morning that will be just as compelling and craveable as our breakfast food.”
So get ready for a lot more fast-food chicken and beverages this year.
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