With 500 stores in the U.S. and Mexico and its 3 billionth wing sale fast approaching, it’s perhaps not essential to discover Wingstop as CEO James Flynn sometimes does: “We are not Buffalo Wild Wings ( BWLD).” Wingstop, which had been founded in 1994 and began franchising 3 years later, has new private-equity owners and sees a lot of possibility to expand within the U.S. and internationally.
Wingstop, a 500-franchise chain, isn’t done growing nationally, internationally or into a whole type of business. Why not? It provides had eight consecutive numerous years of same-store sales increases despite a tough economy that stalled a number of other franchises, which Flynn attributes to consumers trading down from casual dining to so-called fast-casual restaurants because they tightened the purse strings. “We have been for a really good value for the purpose we do,” he says.
But most importantly, there doesn’t are most often a lot of direct competitors. Combined with a powerful management team, industry experts says, that makes selling the Wingstop story to consumers and franchisees that much easier. “If you look around, we have been the sole company which i know of virtually specializing in only wings. If you are taking wings plus beverages plus french fries, you got 90%” from the menu — an exaggeration, though Wingstop’s menu is no-frills. It sells only wings, boneless and bone-in, however with 10 flavors to sauce them up, including “Original Hot, Cajun, Atomic, Mild, Teriyaki, Lemon Pepper, Hawaiian, Garlic Parmesan, Hickory Smoked BBQ and the newest offering, Louisiana Rub.” Orders are made fresh, cooked to buy and customers can get a number of side dishes.
Wingstop is a fast food joint. Buffalo Wild Wings, on the contrary, has become hugely successful as being a part sports bar, part casual-dining restaurant franchise. “We don’t possess real significant chicken-wing competitors,” Flynn says of Buffalo Wild Wings. “We actually consider pizza probably a larger competitor.”
Record-high wing prices forced https://allfoodmenuprices.org/wingstop-menu-prices to take pricing actions at the end of 2017. One of the unwanted effects: Ticket growth that boomed the 1,157-unit chain’s domestic same-store sales an eye-popping 9.5 percent inside the first quarter versus the prior-year period. Systemwide sales jumped 20.4 percent to $313 million and Wingstop had revenues of $37.39 million (adjusted earnings per share of 25 cents). These numbers jolted the chain’s stock more than 7 percent in Friday afternoon trading. Shares are up 65 percent ofexab the very last year.
President and chief executive officer Charlie Morrison admitted in a May 3 conference call that Wingstop’s comps hike “does contain a bit more ticket growth than we may normally prefer.” It was running about for the manufacturer with transactions, Michael Skipworth, CFO, said.
The change stemmed, in certain ways, from Wingstop’s decision to offer split-menu pricing considering commodity concerns. The chain reduced the buying price of boneless wings and conversely increased bone-in prices in some cases. “We did visit a mix shift connected with that,” Morrison said, “that have benefited the P&L upward of 200 basis points on food cost, which had been great, but concurrently, put a bit more lift in the ticket than we might have otherwise preferred.”
However, Morrison said Wingstop were “quite happy” with all the comp performance, understandably. Momentum carried from your fourth quarter into fiscal 2018, and Wingstop used a really strong March to bolster figures.
The organization increased its systemwide restaurant count 12.2 percent in comparison to Q1 2017 because of 22 domestic openings and six international ones. Wingstop would like to reach 2,500-plus units domestically and be a “top 10 global restaurant brand,” Morrison said.
Unit-level economics could be the key driver, he added. During Q1, favorable wing prices combined with the company’s leverage on labor and operating expenses resulted in a whopping 1,000 basis-point improvement to its company-owned restaurant margins. Same-store sales were up 12.5 percent at corporate units.