Burger King wants to go to the future in the United States, but remains stuck in the past

NEW YORK (CNN Business) – Burger King wants to go to the future, but remains stuck in the past.

Restaurant Brands International, the parent company of the fast food chain, announced last month its intention to modernize Burger King's US stores as part of a plan to expand Burger King of tomorrow (Burger King of tomorrow).

Despite the name of the project, these efforts are not new. Up-to-date restaurants will have self-service kiosks and more elegant restaurants: changes that Burger King's competitors began to operate years ago; While they were improving their stores, Burger King focused on marketing campaigns and menu items.

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The new Burger King restaurants will feature open kitchens, two lanes and open-air digital menu boards. The hamburger chain expects the changes to persuade American consumers to order Burger King food more often and spend more money at the store.

This plan is going in the right direction, said Morningstar analyst R.J. Hottovy It is important that Burger King put the emphasis on increased convenience. But the mark "barely catch up here," he said.

Tips and announcements

Up to its modernization plan, Burger King had been promoting new products, including a Halloween hamburger that was having nightmares. He also intervened on political issues with advertising tips such as a "chick tax" on fried chicken in a pink package, designed to draw attention to the so-called pink tax on products intended for women, and a "fast track" Whopper that sought to explain the neutrality of the network.

"They focused a lot on the marketing, product development and menu innovation, "said Neil Saunders, CEO of GlobalData Retail.

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"They are very good at presenting exceptional menu innovations," he added. "It attracts the traffic."

But that was not enough. In the first quarter of this year, Burger King's parent company, Restaurant Brands International, declared itself satisfied with the dynamics of the hamburger chain. "Our comparable sales results for BK this quarter were fueled by a remarkable strength in the US," said Daniel Schwartz, CEO of Restaurant Brands.

Since then, the momentum has diminished. In the second quarter, the company said that comparable sales in the United States had increased 1.8% and that in the third quarter, this figure had decreased by 0.7%. In the United States, same-store sales increased 2.4% in the third quarter at McDonald's. Wendy's sales during this period also declined 0.2%.

These competitors launched their update plans a long time ago.

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Strong competition

During the summer, McDonald's announced a $ 6 billion investment to modernize most of its American restaurants by 2020. The redesign of McDonald's also includes billboards. digital menu and self-service kiosks.

It's important that fast food restaurants update their stores to maximize comfort, Hottovy said. But chains can take years to put all their franchises on the same page.

McDonald's is uniquely positioned as franchisees are confident that the company will produce results, said Sam Oches, editorial director of Food News Media for the magazine. QSR.

"New store prototypes, remodeling … these things are expensive," said Oches. It's easier for a brand like McDonald's to convince franchisees to spend that money. For others, it is no longer a struggle.

Wendy's has spent a decade updating its stores to include armchairs, digital menu boards and Wi-Fi. The company announced this month that it has renovated nearly half of its stores. Wendy's is also thinking of other improvements in the stores: last year, the company announced a new series of smart-design restaurants that use less energy than their traditional stores.

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Burger King may have also experienced difficulties because, unlike Wendy's and McDonald's, he is part of a business. outfit.

Burger King and Tim Hortons merged in 2014 to form Restaurant Brands, which Popeye acquired last year.

"When you become this huge outfit Multibrand … it's hard to focus on the details, "said Oches.

Catch up

To regain balance, Burger King needs to increase store traffic and increase the amount of spending customers spend on regular orders.

"Regular trade is the foundation of sustenance," said Saunders. "The marketing and seasonal events are much less important. "

Burger King is still in the early stages of the project, Schwartz said in October, adding that pilot restaurants were already operating in Miami.

"Updating a store takes a lot of time," said Oches. "So, the fact that we are still at the beginning of this, tells me that they still have a long way to go."