Wienerschnitzel finds the consumer shift to its liking

The company’s sales have thrived during the pandemic as consumers sought out drive-thrus and comfort food.
Photograph courtesy of Wienerschnitzel

Wienerschnitzel was made for a moment like this.

When the pandemic led to broad shutdowns of dine-in service back in March, the Irvine, Calif.-based chain saw its sales drop, just like everyone else. That lasted a week.

“We’ve been up every week since,” CEO Cindy Culpepper said in an interview. Same-store sales at the 340-unit chain are up 22% on average since then.

The reason, Culpepper said, is fairly simple: Drive-thrus and hot dogs. Both of them have been in demand during the pandemic, which has fueled the company’s sales.

Drive-thrus have been a pandemic hero for both consumers and restaurants, playing right into Wienerschnitzel’s strength as a largely drive-thru concept.

“When John Galardi in 1961 started the company, shortly after he added drive-thrus,” Culpepper said. “They were A-frame restaurants and he just put the drive-thrus through the middle of the restaurant. We’ve had drive-thrus ever since.

“Unbeknownst to us we were preparing for an event like we have now.”

Hot dogs have also pulled in customers, she said. “Eating our hot dogs brings joy,” Culpepper said.

That “joy” she describes has come in handy during a quarantine, when consumers are actively seeking out comfort food. “If you’re depressed, what’s better than eating a hot dog?” she said. “You can’t be depressed and eat a hot dog at the same time.”

Wienerschnitzel has been a moderately growing chain for some time—system sales grew 3.6% last year to $265.3 million, according to data from Restaurant Business sister company Technomic, while average unit volumes rose just over 1%. That makes the pandemic performance extraordinary.

Culpepper says that Wienerschnitzel has generated its strong sales through a combination of average check growth as well as transaction growth—the latter has been something of a rarity during a pandemic in which many fast-food chains served fewer customers making larger orders.

Some of the company’s stores, she said, are up close to 50% this year. That’s been a bit of a challenge for some stores not accustomed to those types of unit volumes. What’s more, despite high unemployment, many locations are having a tough time getting staff.

That can make service time consuming, Culpepper admitted. But, she added, “The customers seem willing to wait. As long as they’re getting a quality product. That’s what they’re getting from Wienerschnitzel.”

Culpepper said the company has generated sales in part with a new limited time offer every other month but noted that the products typically have one additional ingredient not in the store, such as a type of sauce. “It makes training very easy,” she said.

The company has left it up to franchisees whether they want to open dining rooms during the pandemic—most do not as restrictions make it difficult to keep them open when a typical Wienerschnitzel has a small dining room.

Wienerschnitzel’s performance is generating interest from franchisees to build new locations. The company is close to signing a couple of multi-unit deals. “I’m personally very excited about this,” said Ted Milburn, director of franchise development. “For us as a legacy brand to grow with new franchise blood makes my job easier. Most are looking forward to next year.”

The immediate challenge for Wienerschnitzel is to keep its new customers—though the company acknowledges that their volumes will decrease when things get back to normal.

But, Culpepper said, “It’s fairly easy when you have outstanding food.”

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