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Wendy's dethrones Burger King, but Five Guys grows fastest

Published March 19, 2012 5:44 pm

Restaurants • Hamburger chains strive to keep up with McDonald's.
This is an archived article that was published on sltrib.com in 2012, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Wendy's has dethroned Burger King as the country's second-biggest hamburger chain.

Wendy's edged out Burger King in U.S. sales volume for the first time last year since Wendy's was founded in 1969, according to the annual ranking of U.S. restaurants by food industry research firm Technomic Inc. that's set to be released next month.

Wendy's had sales of $8.5 billion in 2011, compared with $8.4 billion for Burger King. McDonald's remained far larger than both with $34.2 billion in sales.

The sales rankings for the top five restaurant chains regardless of category have undergone a dramatic shift in the past five years, according to Technomic. In 2006, the No. 2 and No. 3 spots were held by Burger King and Wendy's, respectively, behind McDonald's, making the top three companies all hamburger chains.

Subway now is No. 2, with $11.4 billion in sales last year, and Starbucks is No. 3, with $9.8 billion. U.S. sales at both companies have grown at a much faster rate than the top three hamburger chains, with Subway sales up 48 percent from five years ago and Starbucks sales up 39 percent.

In 2011, limited-service chains, which include fast-food and fast-casual eateries, enjoyed a 3.7 percent sales bump. The latter category saw blockbuster performance, with Panera Bread Co. clocking a 10.1 percent boost, Chipotle Mexican Grill soaring 23.4 percent and Five Guys Burgers and Fries — the fastest-growing chain — seeing a 32.8 percent improvement.

Chicken-wings establishments were also rapidly expanding, with Buffalo Wild Wings Grill & Bar and Wingstop earning spots among the 10 fastest-growing chains. According to Technomic, 36 percent of restaurants (a still-increasing number) now offer wings.

The figures are based on Technomic's estimates of system-wide sales at franchise and company-owned restaurants, rather than corporate revenue, which includes fees from franchise operators. So worldwide, Burger King still has far more restaurants than Wendy's and remains the second-biggest hamburger chain behind McDonald's.

Both Burger King and Wendy's have struggled in recent years to keep up with the growth of McDonald's, which has managed to keep prices low through the recession, while also introducing menu items and remodeling restaurants.

Burger King has been re-evaluating its business since it was acquired by investment firm 3G Capital in 2010. The privately held company recently retired its mascot "The King" last year and launched an advertising campaign focused more on food.

Despite its edge over Burger King, Wendy's also has been on a mission to reinvent itself as a higher-end hamburger chain with new items such as the Dave's Hot 'N Juicy burger introduced last fall.

Full-service restaurants had a more mellow year, with a 2.8 percent increase in sales after a flat 2010. Seafood and steak eateries were healthiest overall, with Red Lobster's sales jumping 6.2 percent and LongHorn Steakhouses' figures up 13.1 percent.