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CHICAGO (Reuters) - Wendy's is betting on a new store format that will make its fast food even faster by eliminating the dining room altogether, the company's North American chief told Reuters on Thursday.
In a nod to Americans' love of convenience, the No. 3 U.S. hamburger chain has opened nine stores with no indoor seating and various configurations of drive-through and walk-up windows. Four to five more are planned to open before the end of the year.
"We spread them out in different markets and different types of demographic areas," said Tom Mueller, Wendy's North American chief operating officer. "The response has been very positive."
Dublin, Ohio-based Wendy's International Inc. (WEN: Research, Estimates), whose hamburger business trails only McDonald's Corp. (MCD: Research, Estimates) and Burger King Corp., is trying to build on the success of its expanded late-night business, he said.
Advertising promotions like "Eat Great, Even Late," have helped Wendy's build its drive-through business to 65 to 70 percent of sales, ahead of industry averages, Mueller said.
The new stores, part of a test that quietly started in August 2002, include four locations in the Detroit area, and one each in Raleigh, N.C.; Atlanta; Austin, Texas; Milwaukee; and the latest, in Columbus, Ohio. The company looks to place the stores in fill-in sites where a full-blown Wendy's might not work, Mueller said.
On average, each test store has about 1,300 square feet, compared to a regular Wendy's, with 3,200. It offers a full Wendy's menu featuring everything from fresh-beef burgers and Biggie drinks to Homestyle Chicken Strips and a host of salads. During peak times, each new store is staffed by a crew of 12, compared to 20 at a traditional Wendy's.
Wendy's, which operates nearly 5,800 U.S. hamburger outlets, plans to make a decision by the end of this year or in early 2005 whether the format will become a permanent option for its franchisees, Mueller said.
"We are not going to knee-jerk," he added, emphasizing that the format might eventually account for 6 to 7 percent of new Wendy's stores added each year.
"It's really going to be the supplement to our growth, not the primary driver of our growth," he said.
In a nod to Americans' love of convenience, the No. 3 U.S. hamburger chain has opened nine stores with no indoor seating and various configurations of drive-through and walk-up windows. Four to five more are planned to open before the end of the year.
"We spread them out in different markets and different types of demographic areas," said Tom Mueller, Wendy's North American chief operating officer. "The response has been very positive."
Dublin, Ohio-based Wendy's International Inc. (WEN: Research, Estimates), whose hamburger business trails only McDonald's Corp. (MCD: Research, Estimates) and Burger King Corp., is trying to build on the success of its expanded late-night business, he said.
Advertising promotions like "Eat Great, Even Late," have helped Wendy's build its drive-through business to 65 to 70 percent of sales, ahead of industry averages, Mueller said.
The new stores, part of a test that quietly started in August 2002, include four locations in the Detroit area, and one each in Raleigh, N.C.; Atlanta; Austin, Texas; Milwaukee; and the latest, in Columbus, Ohio. The company looks to place the stores in fill-in sites where a full-blown Wendy's might not work, Mueller said.
On average, each test store has about 1,300 square feet, compared to a regular Wendy's, with 3,200. It offers a full Wendy's menu featuring everything from fresh-beef burgers and Biggie drinks to Homestyle Chicken Strips and a host of salads. During peak times, each new store is staffed by a crew of 12, compared to 20 at a traditional Wendy's.
Wendy's, which operates nearly 5,800 U.S. hamburger outlets, plans to make a decision by the end of this year or in early 2005 whether the format will become a permanent option for its franchisees, Mueller said.
"We are not going to knee-jerk," he added, emphasizing that the format might eventually account for 6 to 7 percent of new Wendy's stores added each year.
"It's really going to be the supplement to our growth, not the primary driver of our growth," he said.
