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McFranchisees Question Mighty Wings Pricing

Mighty Wings aren’t flying high with some McDonald’s franchisees. The latest survey of operators conducted by Mark Kalinowski, restaurant analyst at Janney Montgomery Scott, finds many compliments for the wings themselves but some disappointment with sales.

McD_MightyWingAD“Good product; too expensive,” one of the 29 franchisees surveyed (representing a total of 183 stores) says of Mighty Wings. Several other operators echoed that assessment of pricing. “Hard to sell for $1 per wing when we still have the Dollar Menu,” says one operator. “Pricing seems high when many retailers are offering for as low as 25¢ at happy hour,” says another. “Too expensive for this economy,” is another opinion.

Though the wings themselves get good marks, some operators question the sauce options. “Customer reaction is very positive, but if it doesn’t have hot sauce then it is just a piece of chicken. It’s running less than 2% of sales,” says one. On the other hand, another franchisee says, “Good product but it’s just plain dumb to offer so many dipping sauces.”

An operator who says there are too many items on the McDonald’s menu complains that Mighty Wings “are an extremely high food cost item.” Another says, “One dollar a wing, no matter what size they are. That is just too expensive in the consumers’ eye. Forty-seven percent food and paper cost for the operator is expensive, too.”

This site has frequently reported on the now-frantic pace of limited-time menu item introductions. Operators worry that consumers might just be worn out on LTOs. “New product introductions don’t seem to interest customers any more. Maybe we’ve overdone it. It seems we are wasting millions on advertising and getting nothing for it,” says one McDonald’s operator. “Limited time offers don’t work with this huge menu,” says another.

As a result of his survey, Kalinowski raised his September same-store sales forecast to +0.1% from -1.0%. Additionally, he lowered his October U.S. same-store sales projection to -0.4%. McDonald’s Corp. will release third-quarter results on October 21.

Monday Meeting: Ever More LTOs

 Watch for Southwest Chicken to be the next LTO iteration for McDonald’s Premium McWrap platform. The spicy version is in several markets and is likely to go national once the Mighty Wings introductory campaign is finished.McD_SouthwestChickenMcWrap1

The Southwest Chicken McWrap has Habanero Ranch sauce, cilantro-lime glaze and tortilla strips. The benefit of a platform like McWrap is that it opens the door to infinite LTO variations, as is clear outside the U.S.: meatless Mediterranean Veggie and Santa Fe Veggie versions are in Canada; Ireland has a Cajun Chicken McWrap. In France, a Chevre (goat cheese) McWrap has been an LTO as has Pepper Chicken.

 If you need another example of the non-stop pace of LTO introductions, look to the UK. McDonald’s is just finishing its annual five-week Tastes of the World promotion but is expected this week to bring back the 1955 Burger for at least its third tour of LTO duty.

KFC_China_SlicedBeefStack ∞ Yum Brands last week reported a 68% decline in third-quarter profit due to problems with its KFC business in China, where same-store sales slumped 11%. But one way KFC is trying to regain its momentum in China is by menuing … beef.

A Hamburger Today reports that KFC is selling a layered-beef sandwich (at l.) that looks very much like a burger. Six layers of thinly slice beef rounds are stacked on a sesame-seed burger bun and topped with cheese, lettuce and mushrooms. The stacked-beef sandwich is 31 yuan or about $5. A Big Mac is 16 yuan, or $2.61, in China.

Pretzel Burgers Can’t Save Ruby Tuesday

Pretzel-bun burgers may be all the rage, but they couldn’t keep casual-dining chain Ruby Tuesday from a double-digit debacle. For its fiscal quarter ended Sept. 3, 2013, the casual-dining chain reported an 11.4% plunge in same-store sales at company restaurants.

Ruby Tuesday's Spicy Jalapeno Pretzel Burger

Ruby Tuesday’s Spicy Jalapeno Pretzel Burger

The dive came despite the chain’s biggest menu rollout in the last seven years. On August 12, Ruby Tuesday introduced eight new products, including four burgers on pretzel buns, three Crispy Flatbreads and a tempura green bean appetizer. Six weeks of TV advertising that included national cable plus spot advertising in select markets backed the launch.

President-CEO James J. Buettgen said the results were “disappointing and did not reflect where we believe we can take the business as we execute our repositioning strategy.” He offered several explanations including the popular “economic issues continue to provide significant headwinds” tack. Buettgen also suggested that a lower average check due to lower pricing for new menu items was a not-unexpected culprit.

“The new items are all priced at or below average, so the pretzel burgers are from $8.99 to $9.49, the flatbreads are $6.99 and $7.99, and the green bean appetizer was $5.99. So on an absolute menu level, or within the categories that they’re featured in, they’re attractively priced items,” Buettgen told analysts. “And we knew going into the rollout that we are going to see some level of check decline to the degree we got strong preference on the items, and that was part of our effort to showcase a more casual and approachable items, but also to give more value and affordability to guests.”

However, when pressed for details, CFO Michael O. Moore explained that only 1% of the 11.4% sales drop was due to check while 10.5% reflected guest-count decline. Added Buettgen, “Keep in mind that our guest declines have occurred over a number of years and will not be reversed overnight. Having said that, we believe we are on the right strategic path and that our efforts will lead to sales and guest count growth over time.”

The Bacon Cheese Pretzel Burger

The Bacon Cheese Pretzel Burger

While Moore noted that only the last three weeks of its first fiscal quarter benefited from the pretzel burger rollout, he was hardly optimistic about the current quarter. “We anticipate same-restaurant sales to be down high single-digits in the second quarter, with sequential improvement in the third and fourth quarter, including positive same-restaurant sales in the fourth quarter, reflecting traction from our new menu offerings and marketing campaign.”

He noted that more than 20% of diners ordered at least one of the eight new items on a menu with more than 60 dishes. He called that “significant and certainly a big step in the right direction. The initial high preference demonstrates how appealing the new items are to our guests.”

The menu revamp will continue with the “new food platforms and items that we have in test,” Buettgen said. Reflecting lessons learned from the introduction of lower-price pretzel burgers, the “products that we have in the queue are at a range of price points, some comparable to those we’ve rolled out, others that are more expensive and more premium,” Buettgen said. Those products will get advertising support more evenly spread out across all 12 months, rather than front-loaded in Q1 as it did last year.

Todd A. Burrowes, COO and Ruby Tuesday Concept president, outlined changes made or planned to improve the brand. These include improving music programming “by offering more of a contemporary mix of rock, pop and Top 40” and exploring changes in lighting and décor “to more accurately reflect our brand positioning.”

Finally, the sees a solution in making its employees more “genuine.” Burrowes said the chain will be “testing an enhanced service platform that enables team members to share their personality and passion for our brand by connecting with guests in a more natural and genuine manner. What I mean by this is that we’ll encourage our team members to make real connections with each and every guest in a fun and friendly atmosphere.”

Postscript: The pretzel-roll infatuation continues to spread. Chili’s this week added Pretzel Roll Sandwiches to its menu.

Ted’s New Burgers; BK Revives Flatbreads

Ted’s Montana Grill keeps its eyes on its burger menu and does a good job of periodically refreshing the lineup. For fall the Atlanta-based chain is cycling in three new burger choices as well as a salad and dessert.

Ted's No. 10 Burger

Ted’s No. 10 Burger

The No. 10 burger first joined the menu in 2012 to celebrate the chain’s 10 anniversary. It’s back now, keeping its classic cheeseburger build of house-made pickles, lettuce, tomato and house Ted’s sauce.

New is the No. 11, a bison patty topped with melted horseradish Cheddar, slow-braised bison short rib, grilled mushrooms and horseradish sauce.

The Madison burger takes its name from Montana’s Madison River. It’s a beef burger with crumbled goat cheese, baby arugula and house Z-sauce (raspberry aïoli) on a wheat bun.

BK's UK Flatbreads

BK’s UK Flatbreads

Also joining the Ted’s Montana menu are a Roasted Beet & Goat Cheese Salad and Apple Pecan Crip dessert.

Θ In March 2012, Burger King offered a Lamb Flatbread sandwich in its UK stores. The bread, if not the lamb, are back. This week, the chain introduced a Flame Grilled Beef Flatbread burger and Flame Grilled Chicken Flatbread sandwich. Those snacks shown in the photo are new Garlic Cheese Balls.

In New Zealand, Burger King has struck an interesting partnership with Tui, one of the nation’s largest brewers.  A new sandwich called The Brewer’s Chicken is a chicken patty topped with cheese, bacon, beer-battered onion rings and BarB Tui barbecue sauce

Θ Finally, watch for Carl’s Jr. to announce yet another breakfast item this week. This one is a breakfast sandwich with three sausage links, cheese and a folded egg on a biscuit. A new quesadilla is coming, too, to Carl’s Jr. units co-branded with Green Burrito.

Burgers Star at 5 of Esquire’s Best New Restaurants

Who would have expected that celeb chef Ming Tsai’s Blue Dragon gastropub in Boston would have a burger on the menu? It does, and so do four other restaurants selected by Esquire’s John Mariani as being among the Best New Restaurants in America for 2013. He chose a total of 19 hot spots, but we’ll celebrate those with the courage to say they can make a mean burger.

"The Duke" burger at King + Duke.

“The Duke” burger at King + Duke.

The Dragon Burger at Ming Tsai’s Blue Dragon is topped with teriyaki onions, smoked Gouda (the trendy burger cheese of the moment) and tomato jam. House fries are on the side and the choice is a reasonable $14.

Chef Victor Albisu at Del Campo in Washington, D.C., definitely knows how to burger. He’s not afraid to offer his $16 Del Campo Burger at both lunch and dinner. Its grass-fed beef patty is topped with grilled bacon, grilled avocado, onion, smoked tomato and provolone. Fries, of course. The menu stresses that the Del Campo Burger pairs well with the $4 Happy Hour beer that’s available all day.

Atlanta’s King + Duke proudly serves its “The Duke” burger at lunch and dinner. The build is house-ground chuck and dry-aged cuts, coal-roasted onion and pickle with fries for $16.

The initials at MC Kitchen in Miami belong to Chef Dena Marino and Managing Partner Brandy Coletta. You want a burger? They’re menuing a “Half Pound” Harris Ranch Angus Burger.  Provolone, thick bacon, Brooklyn Brine Co. pickles & all the condiments are piled on a soft bun for $15.

Stephan Pyles is one of Dallas’s best-known and most respected chef/restaurateurs. Perhaps it’s because he likes burgers. The Stampede Burger on the lunch menu for his new Stampede 66 has bacon and pimiento cheese on a brioche bun for $14.

Burgerless but also on Esquire’s Best New Restaurants list are:

The Del Campo Burger

The Del Campo Burger

Betony, New York City

Bronwyn, Somerville, Mass.

Carriage House, Chicago

The Elm, Brooklyn

Embeya, Chicago

Hinoki & the Bird, Los Angeles

Juni, New York City

Mariza, New Orleans

The Ordinary, Charleston, S.C.

Paiche, Marina del Rey, Calif.

Rolf and Daughters, Nashville

Spoon Bar & Kitchen, Dallas

Trois Mec, Los Angeles

Flip Burger Boutique CEO Maps Growth

Does a concept where last week’s special was The Osso Bucco Burger (Osso Bucco patty, braised veal, braised ketchup, gremolata mayo, fried shallots and parsley) have a future as a chain? Rick Tasman, recently named CEO of Atlanta’s Flip Burger Boutique, is sure it does and he’s working to make that future bright.

Flip's Osso Bucco Burger

Flip’s Osso Bucco Burger

Flip was opened in 2008 by Richard Blais, one of two “cheftestants” in Season 4 of Bravo’s “Top Chef” who opened burger joints (The other was Skip Mendelsohn, who opened D.C.’s Good Stuff Eatery. Additionally, Season 4 winner Stephanie Izard’s Little Goat Diner in Chicago has a prominent burger menu). A second Atlanta location has since opened, plus a unit in Birmingham, Ala. A third Atlanta location opens soon. Tasman says he joined up because he sees expansion opportunities for the upscale concept.

“We aim to grow,” Tasman told BurgerBusiness.com. “I’ve been enamored with Flip for a long time. It’s a differentiated concept that holds a distinctive niche in the burger segment. It’s a crowded segment, certainly, but we occupy a different place in that we’re full-service with innovative, chef-created burgers, a full-service bar and a loyal following.”

Flip CEO Rick Tasman

Flip CEO Rick Tasman

Tasman has more than 35 years of restaurant experience, including a 14-year stint with P.F. Chang’s (lastly as its chief operating officer). Flip will look first at major markets, but Tasman says that there are several cities within 400 miles of Atlanta—including Charleston, S.C.; Charlotte, N.C.; Indianapolis; Louisville; Nashville and Raleigh N.C.—he is looking at.

“There are some great markets out there where Flip would do very well in,” he says. “I don’t think we’ll be a 200-unit concept but certainly there’s a possibility we could get to 100.”

Franchising is not in the picture, Tasman says. Flip Burger Boutique is difficult enough to execute that it’s not wise to turn it over to others.

Chef-founder Richard Blais intends to remain Flip's culinary director.

Chef-founder Richard Blais intends to remain Flip’s culinary director.

Despite the skills needed to execute Flip, Tasman doesn’t aim to change the concept. Blais will continue to be the restaurant’s face and culinary guide. Osso Bucco burgers are a bit epicurean, but that kind of creativity is what guests come for and it won’t change. “They look forward to the new items and the innovations,” Tasman says. For us to move away from our core guests would be a mistake.”

Flip has a toney image but has worked to avoid being perceived as high-priced. The menu includes Red Haute Hot Dogs at $5.50; the Classic burger, fried chicken and turkey sandwich are all priced at $7.50. Burgers top out at $14 for the Earth+Turf.

Tasman wants to increase Flip’s average check but not by raising prices. He wants to add bar appetizers and snacks that can boost customer traffic to the full-service bar. And the fall menu (being released later this month) will include Flip’s first entrée salad. Tasman expects more will follow.

The Flip concept needs no significant changes, Tasman says. “We probably need to button up operations a bit and make sure we can replicate it and execute it in other markets,” he says. “So I want to make sure our culinary ops are in good shape and that we have the training materials needed so we can teach the concept. There are great opportunities out there.”

Pal’s Reaches Out to Absent Friends

Pal’s Sudden Service restaurants don’t look like those of any other burger chain in America, so it’s only right that it has an advertising strategy all its own. Pal’s latest campaign doesn’t spotlight Millennials, teens or heavy users but people who can’t visit its restaurants.

“Come Home to Pal’s” is the theme of the marketing campaign that broke this week. The 25-location chain, based in Kingsport, Tenn., knows that some of its loyal fans have moved away for one reason or another. The chain says approximately 20% of its 48,000 Facebook followers live outside its northeastern Tennessee/southwestern Virginia territory. So the chain is inviting those who love its Big Pal burgers, hot dogs and Frenchie Fries to submit a 150-words-or-less essay via http://palsweb.com/comehome nominating someone who should come on home to Pal’s.

Nothing else looks like a Pal's restaurant.

Nothing else looks like a Pal’s restaurant.

“We consistently receive comments through our social media sites from folks who used to live in our region, wishing that they were back home so that they could enjoy the Pal’s menu,” said Pal’s President-CEO Thom Crosby. “Just in time for the holidays, we are going to delight one lucky person with that opportunity. We will select one person, who can bring a guest, to receive round-trip airfare home for a visit with old friends and a catered meal to feed up to 25 people from Pal’s.”

The multimedia campaign, created by longtime Pal’s agency Creative Energy in Johnson City, Tenn., uses broadcast, outdoor and social media to connect with current and past Pal’s customers. A TV spot (above) features a woman who makes a friend homesick by enjoying a Pal’s hot dog during their online Skype conversation. The contest runs through Nov. 15, 2013.

Burgers of the Month for October 2013

Cinnamon on a burger. I hadn’t considered it, but two burger spots—Kuma’s Too and Milwaukee Burger Co.—create Burgers of the Month for October that work cinnamon into their builds. Check them out. Not surprisingly there are a few Oktoberfest burgers among the monthly specials, but several joints—Grill ‘Em All and Kuma’s Corner among them—that peg specials to Halloween. By the way, Grill ‘Em All surely is the first to top a burger with a “savory pumpkin-sage polenta cake.” It might be the only place that would do that, which is why its customers love it.

Honest Burgers' Beef & Black Pudding Burger

Honest Burgers’ Beef & Black Pudding Burger

On the topic of nontraditional toppings, this month we welcome London’s Honest Burgers. Its special this month is a Beef & Black Pudding burger with apple tempura, tarragon-and-caper mayonnaise and baby leaf lettuce. That’s not on your menu. Note, too, that athletes get LTO burgers at two spots: brb’s RGIII burger (for the Redskins QB) and DMK Burger Bar’s The Kaner (Blackhawks star Patrick Kane). The Oinkster salutes “Parks And Recreation” star Nick Offerman with a ham-topped burger. And Slater’s 50/50 stands apart from the crowd again with a Korean-inspired Bulgogi Burger.

October Burger of the Month specials:

5 Star Burgers, multiple locations, Southwest
Oktoberfest Burger
Harris Ranch beef burger with Swiss cheese and IPA Ale-braised onions.

8 Oz. Burger Bar, Seattle
Prosciutto Burger
House-blend patty, roasted-garlic tomatoes, shaved prosciutto, mozzarella, basil pesto with an over-easy egg.

A&G Burger Joint, Miami
Volcano Burger
Angus beef patty basted with our house-made fire buffalo sauce, built with pepper-Jack cheese, jalapeños, lettuce tomato and red onion. Served on a brioche bun with chipotle mayo.

BGR: The Burger Joint, multiple locations
BGR Legendary burger topped with Muenster cheese, bratwurst, sauerkraut and mustard-ale sauce all on a pretzel bun

Burger 21's Over Easy Bacon Cheesy

Burger 21′s Over Easy Bacon Cheesy

 Blue Moon Burgers, Seattle
The Sloppy Joe
We take our premium beef, fresh onion, red & green bell peppers and cook them together to bring you the Sloppiest of Joes!

Bobby’s Burger Palace, multiple locations
Nacho Burger
Tomato-chipotle salsa, nacho cheese sauce, pickled jalapeňos, blue corn chips

brb: Be Right Burger, Reston, Va.
Angus burger topped with Swiss cheese, shaved ham and Sweet Baby Ray’s BBQ Sauce

Buckeye Beer Engine, Lakewood, Ohio
Tadd’s Thai Bang-Bang Burger ($9)
A half pound burger patty topped with a Thai peanut sauce, red and green bell peppers, bean sprouts,and fresh jalapeňo slices. Served with a breaded pickle and Beer Engine chips.

Burger 21, multiple locations
Over Easy Bacon Cheesy
The Over Easy Bacon Cheesy takes our beefy Bacon Cheesy up a notch with a freshly made over-easy egg, avocado slices and Dijon-chive mayo.

Click here to continue reading Burgers of the Month for October 2013