Wendy’s CEO Kirk Tanner says that the US fast-food brand’s “quality differentiation” is resonating with UK consumers, suggesting strong potential to grow the market.
“We’ve seen real momentum in the UK”, he said during a Q4 2023 earnings call for The Wendy’s Company.
The business missed analysts’ expectations during the period, with revenue flat year-on-year at $540.7 million.
Meanwhile, it reported international sales growth of 9.7% in the fourth quarter, and 14.1% in the full year compared to 2022.
Considering how Wendy’s can create success in a mature market like the UK, with a number of established fast-food players, Tanner said, “We have enough evidence with winning over customers with our quality, which is meaningful for the UK consumer.”
In October 2019, Wendy’s announced that it was returning to the market, and it now operates over 30 sites across the country.
Tanner added that Wendy’s was enjoying growing brand awareness and “brand love” in the UK.
“Those are the things to think about when you are building a market; the awareness, what you’re famous for, and differentiation.
“We have seen the growth and we will continue to build in that UK market.
“I feel really good about where we are going internationally, and the UK is a very strong market and has tons of potential for the future.
Chief financial officer, Gunther Plosch added that early confidence from franchisees was encouraging.
“Our franchisees are super excited. We have ten franchised restaurants in the UK, and 12 company units”
“Initial results that our UK franchisees saw, excited them so much that early in, they increased development commitments.
“They said there is something that is resonating with the UK consumer; that is another good data point, to show that we got the entry into the UK right.”
Plosch added that success in the UK would provide a “springboard into Europe.”
“We think the investment is going to pay off nicely for us and our shareholders,” he added.
However, the company’s outlook for 2024 forecast that the startup investment, alongside ongoing inflationary pressures in the UK market, would represent a headwind of approximately 50 basis points to global company operated restaurant margin.
