Burger Kind has few advantages over its much larger rival McDonald’s Corp. (NYSE: MCD), which has almost 13,000 locations in the United States. Burger King has just over 7,000. Wendy’s Co. (NYSE: WEN) is gaining with almost 6,000 stores. Burger King’s sales last year were less than $2 billion, in contrast to McDonald’s sales of $27.5 billion.
Size is only one thing that matters in the fast-food business. Menu is another. McDonald’s had a problem when its sales slowed almost a decade ago and it faced a drop in same-store sales. It launched a full breakfast menu with designer coffees like lattes to increase revenue and flank Starbucks Corp. (NASDAQ: SBUX). For the most part, the decision turned out well.
McDonald’s has been the target of health officials and the medical community because of a menu that is filled with food and drinks high in calories, fat and sugar. The company only irritated the groups when it launched its “The Annihilator” in early summer. The sandwich weighed seven pounds.
Fast-food companies have not done much to counter the claims of health experts. McDonald’s and its competitors likely reason that as long as the public streams through their doors, the opinions of those who want healthier menus do not matter.
Burger King’s decision to launch its Satisfries may not be to satisfy health officials. The company could simply believe that some portion of American consumers actually worry about their cholesterol and arteries. If Satisfries sales begin to rise quickly, Burger King will be ahead of the balance of the industry in terms of creating a lower-fat product with significant appeal.
Burger King may not be the largest fast-food company in America. However, it may have hit upon a product that will help it to get bigger.
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