Is Burger King a successful business?
Whopper Combo.
Burger King, owned by the company Restaurant Brands International, operates nearly 19,000 restaurants worldwide, with 90% of these being owned and operated by independent franchisees. Burger King, like other fast food giants, are not immune to market challenges. A current issue that the fast food industry is facing right now is the rising cost of beef. Primarily as a result of labor shortages in the meatpacking industry. Furthermore, this increase in operating costs became the primary cause of many Burger King’s shutting down nationwide.
Moreover, with 400 stores projected to close by the end of 2023!
Labor shortages across America have caused the cost of beef and other key ingredients like pork to increase drastically. Staffing meat-packing plants has proved difficult, resulting in a decrease in the supply of these products and a consequent increase in price. Some have pointed to stimulus checks as a part of the reason, suggesting that the financial assistance is reducing the incentive for meatpacking workers to show up.
Compared to the rest of the world, the labor shortage in America is the most drastic. With post-pandemic prices beginning to stabilize globally, fast-food franchises including Burger King have begun to return to normal. However, in America, Burger King sales are trailing behind competitors like McDonald’s and Wendy’s due to the increase in operational costs. This has resulted in up to 400 Burger King franchises closing in 2023 alone.
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Consumers can easily perceive increases in food prices at the grocery store since they are the ones purchasing the base products. However, they may overlook secondary repercussions such as rising fast-food prices. With the price of beef increasing, it could potentially lead to higher prices at fast-food restaurants. As of June 2023, the average price of a Whopper at Burger King costs $4.19, compared to $5.17 for a Big Mac at McDonald’s, and $6.09 for a Baconator at Wendy’s. Higher costs could push Burger King’s prices up, nudging it closer to its competitors’ flagship burgers.
Burger King, Seoul, South Korea.
To face these challenges, Burger King has announced a substantial $400 million plan aimed at boosting its U.S. sales, which have been lagging in comparison to rivals like McDonald’s and Wendy’s. This strategy involves a substantial investment in advertising, remodeling its restaurants, and enhancing its digital platforms. The strategy, aptly named “Reclaim the Flame”, demonstrates Burger King’s determination to revitalize its brand and enhance its operations.
Of their nearly 7,000 locations nationwide, around 800 locations are set to receive a full remodel, and about 3,000 more will undergo technology upgrades and enhancements to kitchen equipment and building structures. Furthermore, $30 million has been allocated towards developing their app further as online ordering has become more popular in recent years. Burger King is also innovating its menu, with plans to develop new Whopper flavors and make investments in employee training. It’s clear that Burger King is investing heavily in enhancing the customer experience, both in terms of the physical environment and the food options.
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These changes will take time to implement. The company expects remodels to start appearing on the market around mid-2023, with the overall transformation happening gradually over a few years. While Burger King anticipates that these investments may initially affect its earnings, the hope is that they will start to pay off by 2025.
Burger King in Beijing International Airport, Beijing, China.
The strategy also extends to their menu, with a greater emphasis on premium branding, especially for the Whopper. For instance, the burger is expected to be removed from discounts and have new flavor extensions developed. In addition, Burger King also plans to bolster its chicken offerings by replacing the short-lived Ch’King Sandwich with the Royal Crispy Chicken Sandwich, which comes in crispy, spicy, bacon and Swiss cheese variants. The Royal Sandwich is part of a simplified menu aimed at improving operations. Over the past year, these streamlining efforts have resulted in four straight quarters of better operating metrics and improvements in guest satisfaction. To sustain these positive changes, Burger King plans to host “Royal Roundtable” events with managers and franchisees to educate teams on implementing operational changes.
On the value side of their offerings, Burger King is keeping a pulse on everyday value for customers grappling with historic inflation.
Currently, they are offering a $6 Your Way Deal, which includes a double cheeseburger, Chicken Fries, and regular fries. This meal deal replaced the $5 Your Way Meal, which included a Double Whopper Jr., nuggets, fries, and a drink.
A meal including small French fries, a Whopper Jr., a drink, and packets of Heinz ketchup
In the face of such adversity, Burger King’s resilience and adaptive strategies point towards a promising future. Even with rising operational costs and increased competition, their $400 million investment strategy is proof of their commitment to improving the brand and staying competitive in the fast-food industry.
Furthermore, although 400 location closures represent a significant number. However, it amounts to less than 6% of their total US locations and only 2% of their international ones.
Thus, Burger King is still a formidable player in the fast-food industry and is proactively making changes to hopefully ensure its long-term success.
In conclusion, the increased cost of beef poses a large challenge for the fast-food industry due to its heavy reliance on this ingredient. However, the “Reclaim the Flame” strategy plans to revamp Burger King’s operations, menu, and overall image. With this, Burger King appears well-positioned to navigate these unstable times and the long term. Lastly, only time will tell how successful these initiatives play out. However, the company’s proactive approach and investment in its future certainly stand as encouraging signs.
Written by Jonah Luetke
Works Cited for Is Burger King a successful business?
“Burger King Menu Prices & Calories (Updated June 2023).” Latest Menu Prices and Calories – Updated Daily, 5 June 2023, www.fastfoodprice.com/menu/burger-king-prices/. “Burger King | Company Overview & News.” Forbes,
www.forbes.com/companies/burger-king/?sh=572207ed4447. Accessed 16 June 2023. Coley, Ben. “Inside Burger King’s $400m Comeback Plan.” QSR Magazine, 9 Sept. 2022, www.qsrmagazine.com/fast-food/inside-burger-kings-400m-comeback-plan. Lucas, Amelia. “Burger King Unveils $400 Million Plan to Revive U.S. Sales with Investments in Renovations and Advertising.” CNBC, 13 Apr. 2023,
“McDonald’s Prices 2023 – Mcdonald’s Menu & Latest Prices.” McDonald’s Prices, 2 Mar. 2023, mcdonaldsprices.com/mcdonalds-prices/.
Patton, Leslie. “Burger King Parent Sees Labor Crunch Driving up Beef Costs.” Bloomberg.Com, 17 Aug. 2021,
