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Wingstop Is the Latest Franchise To Suffer From Soaring Food Costs
Continued supply chain issues are raising the cost of food for restaurants, resulting in rising menu prices.
The cost of chicken is rising, and fast-food chains like Wingstop, with more than 1,400 units, are not immune to its effects. Wingstop CEO Charlie Morrison reportedly said in an announcement to analysts that the brand’s menu prices will go up 4-5% in the coming weeks, for a 10% total increase in the cost of its wings.
“This environment we’re in, which we don’t believe is transitory in any way, shape or form, is driving the need to take price,” Morrison told analysts. “This will be a level-set for the future, and we will revert back to our cadence.”
Wingstop typically only raises menu prices 1-2% each year, so this is a significant increase from years past. Restaurant Business Online reported that food, beverage and packaging costs for the quarter ending September 25 made up 48.1% of Wingstop’s sales, while those same costs accounted for 36.4% of its sales for the same time last year.
Morrison has spoken with franchisees about the supply chain issues and rising costs, and one way the company has dealt with high wing prices is to sell bone-in thighs and boneless thigh bites.
“It’s making a meaningful contribution to the brand,” Morrison said. “It’s going to build over time. It’s following a trajectory we saw many years ago when we introduced boneless wings. We have a long way to go but it’s giving us confidence.”
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