On this week's Extra Serving, NRN editor in chief Sam Oches and executive editor Alicia Kelso discuss the latest restaurant industry news, including Salad and Go closing all of its restaurants and major chains reporting their latest quarterly earnings, from McDonald’s and Burger King to Wendy’s, Texas Roadhouse, Bloomin’ Brands, Dine Brands, Sweetgreen, and more.
First up is the news that Salad and Go had closed all 70 or so of its remaining restaurants while simultaneously filing for Ch. 11 bankruptcy protection. The sudden closure comes just a few years after Salad and Go sold to Volt Investment Holdings and aggressively pursued growth with its value-oriented drive-thru salad concept. Sam and Alicia discuss what went wrong for Salad and Go and what it suggests about other emerging chains pursuing growth.
Next they tackle a very busy week of restaurants earnings, starting with chains that boasted positive sales. That included Texas Roadhouse and Bloomin’ Brands — both of which are proving that consumers are seeking value in the casual steakhouse experience — as well as IHOP, First Watch, Dutch Bros, and El Pollo Loco.
Then they shift their focus to chains that had only a so-so quarter, particularly McDonald’s and Applebee’s. McDonald’s quarter especially was out of character — same-store sales only rose by 0.8% — and the company acknowledged that its marketing initiatives were not executed to their expectation. The result led to McDonald’s USA president Joe Erlinger stepping down and COO Skye Anderson promoted to the position.
Next up, Sam and Alicia dig into the chains that had particularly bad quarters: Popeyes, Portillo’s, Papa Johns, Wendy’s, and Sweetgreen. Wendy’s especially had a brutal quarter, with traffic dropping 12.5%, while Papa Johns continued a streak of negative sales that led to the chain shaking up its marketing leadership. Why are these brands struggling so much? And what should they do to turn things around? Sam and Alicia discuss.
They close on a high note: Burger King posted one of its best quarters in years and surpassed Wendy’s to become the second-largest burger chain by sales. Sam and Alicia examine what is going right for Burger King and why they think it is the best story of the year so far.
For more on these stories:
Burger King’s sales took off last quarter, but Popeyes is in a slump
Dine Brands reports Q2 IHOP outperformance while Applebee’s sees slow improvement
Wendy’s takes steps to fix its brand as sales fall again