Insights

While Wendy’s has done well to magnify its significant menu prowess sufficient to generate a respectable +18% cumulative U.S. comp growth from 2019 – 2022, the chain must continue to work to translate its QSR+ positioning into increased frequency from a higher income demo sufficient to drive a higher check and store level profits.

IHOP is well positioned as the largest player in the $1B+ family chain segment with 30% market share and the largest marketing budget in the segment. The chain is well known for: an unexpected twist on “all things breakfast, any time of the day”; world famous pancakes; flavored syrups; and the never empty coffee pot

While McDonald’s is well positioned for the long-term with solid execution around sound fundamentals, the current macro environment may prompt its core value-oriented customers to demand more deals and concessions than the system is prepared for.

While Jack has done a great job of reviving an iconic West Coast brand in a crowded field, it remains to be seen how the chain’s value equation will fare over the medium-term given a turbulent macro environment amplified through a problematic California lens.

While Chili’s has been able to distinguish itself in a crowded FSR space with an attractive Tex-Mex menu, fun experience, leading value and digital strength, the chain’s immediate challenge is to survive the onslaught of economic pressures on its value oriented customer base.

While Panera is well positioned for the long-term with a healthy halo and digital strength, near-term results may be tempered by the need for more value in a difficult economy and the need for a higher level of labor efficiency to support store-level profitability.

4Q:22 Investor Call Summary provides a concise analysis of how the $1B+ chains performed including sales, costs & popular promotions.

RR’s Finance & Valuation report is based on survey responses (equally weighted) from 60 finance companies including traditional cash flow lenders, sale leaseback companies, SBA lenders and equipment finance companies.

Church’s is executing around a well-conceived strategic plan, the chain’s performance is currently challenged by ongoing inflationary pressures that are particularly hard on its core low income target market.