Wendy’s Says It Won’t Use Surge Pricing After Internet Backlash

The fast food chain Wendy’s clarified that it has no plans to use “surge pricing” during its busiest hours. The announcement, made on Tuesday, followed reports in multiple media outlets suggesting the business is considering experimenting with dynamic pricing that changes throughout the day in response to customer demand.

In a statement, the company asserted that the dynamic pricing model was being misinterpreted. The chain says it intends to reduce prices during slower periods rather than increasing them during busy ones.

“We said these menu boards would give us more flexibility to change the display of featured items. This was misconstrued in some media reports as an intent to raise prices when demand is highest at our restaurants. We have no plans to do that and would not raise prices when our customers are visiting us most. Any features we may test in the future would be designed to benefit our customers and restaurant crew members. Digital menu boards could allow us to change the menu offerings at different times of day and offer discounts and value offers to our customers more easily, particularly in the slower times of day.”

Senator Elizabeth Warren weighed in on the issue on her X account, suggesting the new strategy is exploitative.

“Wendy’s is planning to try out ‘surge pricing’— that means you could pay more for your lunch, even if the cost to Wendy’s stays exactly the same. It’s price gouging, plain and simple, and American families have had enough.

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The company is already the most expensive fast-food restaurant among competitors like McDonald’s, Taco Bell, Burger King, and Chick-fil-A.

In an earnings call earlier this month, Wendy’s CEO Kirk Tanner highlighted that upselling and dynamic pricing were key strategies for driving sales growth. “We will begin testing more enhanced features like dynamic pricing and day-part offerings along with AI-enabled menu changes and suggestive selling,” he said.

“As we continue to show the benefit of this technology in our company-operated restaurants, franchisee interest in digital menu boards should increase further supporting sales and profit growth across the system.”

Many businesses, including rideshares like Uber and Lyft and ticket distributors like Ticketmaster, employ dynamic pricing models to charge higher rates in response to user demand.

In an email to CNN, the company reiterated that it will not employ a similar system.

“Wendy’s will not implement surge pricing, which is the practice of raising prices when demand is highest. This was not a change in plans. It was never our plan to raise prices when customers are visiting us the most.”

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Juan Castillo, assistant professor of economics at the University of Pennsylvania, told CNN that “surge pricing” was a poor choice of words to describe the pricing strategy.

“Whoever called it surge pricing made the worst marketing mistake you can think of. Surge pricing sent the message to everybody that this is mostly about increasing prices. That created a very negative reaction from the public.”

According to Jonathan Maze, editor-in-chief of the trade publication Restaurant Business, the introduction of dynamic pricing to Wendy’s may lead to other fast food restaurants adopting the technology.

“If Wendy’s idea works, it could get others to do something similar, and I wouldn’t be surprised to see another chain or two test the idea themselves, given what Wendy’s is doing.”

In response to Wendy’s announcement, Burger King is giving out free burgers from Feb. 28 to March 1 on purchases of $3 or more.

“We don’t believe in charging guests more when they’re hungry,” Burger King wrote in a press release announcing the limited-time deal. “Surge pricing? Well, that’s new,” the company added. “Good thing the only thing surging at BK is our flame!”

In order to implement digital menu boards at all of its restaurants in the United States by the end of 2025, Wendy’s intends to spend approximately $20 million. Over the next two years, another $10 million will be set aside to bolster digital menu upgrades internationally.


Chipotle Sues Sweetgreen for Trademark Infringement Over New Menu Item

On Wednesday morning, Sweetgreen stocks dropped by 10% after Chipotle Mexican Grill sued the company for trademark infringement over its new “Chipotle Chicken Burrito Bowl.” The lawsuit comes less than a week after the menu item was announced.

Sweetgreen is well-known for providing healthy food at scale, and the company has recently been attempting to diversify beyond its signature salads. The bowl will only be available for a limited time.

In its complaint, Chipotle claims to have sent Sweetgreen a cease and desist notice asking the company to drop “Chipotle” from the item’s name. Sweetgreen did not respond.

Chipotle alleges that it also suggested Sweetgreen alter the name to something that uses “chipotle in lower-case, in a textual sentence, to accurately describe ingredients of its menu item,” like a “chicken bowl with chipotle.”

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In a statement during the product’s release, Sweetgreen’s co-founder and chief concept officer Nicolas Jammet explained that diner suggestions prompted the addition to the menu.

“Our customers’ feedback plays a major role in the new menu items we introduce, and the Chipotle Chicken Burrito Bowl is our answer to heartier meal options that can be enjoyed any time of the day. Inspired by bold chipotle spices, this protein-heavy option balances a brand-new flavor profile for Sweetgreen with whole grains and better-for-you ingredients that our customers love.”

The lawsuit further claims that the new product’s advertisements feature the word “Chipotle” in a font very similar to the one used in Chipotle’s logo and occasionally uses a shade of red that resembles Chipotle’s trademarked Adobo Red. Chipotle also alleges that the two chains are competitors in the fast-casual dining industry.

Along with asking for an injunction against Sweetgreen using “Chipotle” in the bowl’s name, Chipotle is also asking the courts for the profits made by Sweetgreen off the menu items.

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In a statement to CNBC, Laurie Schalow, Chipotle’s chief corporate affairs officer, said that the lawsuit is a matter of protecting the company’s brand. The lawsuit states the item is “very similar and directly competitive.”

“We don’t typically comment on litigation, but we will say generally that we’re committed to protecting our valuable trademarks and intellectual property. Consistent with that, we will take appropriate actions whenever necessary to protect our rights and our brand.”

Shares of Sweetgreen have dropped 24% in 2023, reducing the company’s market value to $726 million and causing investors to worry about the company’s future.

However, despite general economic uncertainty, Chipotle has continued to enjoy robust business. During the same period, the fast food behemoth saw its stock value increase by 22% to $47 billion.

Fast Food

Beyond Meat Announces Collaborative Deals With McDonald’s And Yum Brands

Beyond Meat announced this week that they have signed a deal with fast-food giants Yum Brands and McDonald’s. The collaborations couldn’t have come at a better time for Beyond Meat, as their shares recently fell due to a bigger-than-expected quarterly loss which occurred as a result of weak restaurant sales brought on by the pandemic, as well as the increasing cost of global expansion.

Recently shares for Beyond Meat were down by about 3%. The company is remaining hopeful due to an increase in restaurant orders throughout the nation, but the newest fast food collaborations will hopefully bring the company back to their pre-pandemic success.

Wall Street specifically cited the loss in revenue and shares for Beyond Meat as 34 cents lost per share (they were expecting 13 cents for the quarter) and earning $101.9 million in revenue (expecting $103.2 million). “The company reported its fiscal fourth-quarter net loss of $25.1 million, or 40 cents per share, widened to a loss of $452,000, or 1 cent per share, a year earlier.”

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Total net sales rose by 3.5% to $101.9 million, and US grocery revenues for the company rose by 76% this quarter; an understandable increase considering how much grocery store delivery services have grown in popularity with the pandemic.

Beyond Meat CEO Ethan Brown said that “Beyond is still the top plant-based meat alternative in grocery stores. Listen in total U.S. foodservice revenue tumbled 42.6% during the fourth quarter as the pandemic continued to weigh on restaurant demand for meat substitutes. But the years-long partnerships with McDonald’s and Yum show that restaurant companies still believe consumers want plant-based alternatives.”

Beyond has just signed a three-year long deal with McDonald’s which will make the company the prime plant-based patty provider for the fast food giants McPlant burger; currently being tested in some global markets. McDonald’s and Beyond also announced that they would be collaborating to develop new substitutes for pork, chicken, and egg, to really make their menu more inclusive.

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Beyond and Yum Brands will also be working together to create exclusive menu items for KFC, Taco Bell, and Pizza Hut over the next few years. The financial specifics of these deals were not made public information, but based on the fact that Beyond is now teaming up with some of the world’s most notable fast food brands, it likely was a big one.

“These deals are enormous. They are the biggest deals you could possibly put together in food in our sector. And we don’t want people to get ahead of themselves.”

Brown explained that “Beyond is trying to position itself as a global player. Its international revenue fell 16.5% during last quarter, dragged down by declines in its foodservice segment. But our spending in Europe and China is showing massive success.”

Brown announced that Beyond would be releasing two updated meatless burger patties in the spring as well. Both patties are thought to be the juiciest burgers from Beyond yet, one being made with 55% less saturated fat than a traditional beef patty.

McDonalds Golden Arches

McDonald’s Is Fighting The Chicken Sandwich Battle With Breakfast

The fast food industry is one of the most lucrative and vast businesses in the World today. Companies such as McDonald’s, Wendy’s, Burger King, Chick-fil-A, and Popeyes, to name a few, are in constant competition with one another over which is the most superior, even though all are globally successful. 

One of the most recent fast food “battles” that has taken over the nation was between Popeyes and Chick-fil-A, and it involved an American staple; the chicken sandwich. Now, McDonald’s wants to throw its hat in the ring at the chance to prove that they might have the best chicken options. For a limited time, McDonald’s has announced that they are expanding their breakfast menus nationally to include Chicken McGriddles and McChicken Biscuit sandwiches; previously these options were only available in a few regional locations. 

McDonald’s is also currently in the trial phases of creating their very own crispy chicken sandwich, along with a deluxe version that would include lettuce, tomatoes, and mayo, however, the sandwich is currently only available in Knoxville, Tennessee and Houston, Texas. 

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With chicken sandwiches being the token of fast food desire for so many this past year, McDonalds franchise workers began to worry that their very limited chicken menu items would set them back exponentially. Especially in comparison to establishments like Chick-fil-A, who are known for their premium chicken sandwiches. 

“Unfortunately, [customers] have to go to Chick-fil-A for the chicken sandwich they crave. We have great Chicken McNuggets and our McChicken is a very good product. But we do not compete in the premium chicken sandwich category, either grilled or crispy,” said the National Owners Association for McDonald’s.

Linda VanGosen, vice president of menu innovation at McDonald’s, recently stated in an interview that the increase in demand for more chicken-based menu items paralleled similar demands for an expansion on their popular breakfast menu. So in order to satisfy all customer desires, they combined both demands and decided to expand on the breakfast menu with the Chicken McGriddles and McChicken Biscuits. 

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She also mentioned that in the regional areas of the country where these items have already been implemented on the McDonald’s menu, customers have “enthusiastically welcomed” the newer chicken options that are now available nationally. 

The move to integrate more chicken into their breakfast menu may seem like a weird choice considering that they’re competing with two companies that are known for just a standard chicken sandwich, however, for McDonald’s it actually makes perfect sense. As previously stated by the board, McDonald’s can’t compete with the likes of Chick-Fil-A when it comes to a traditional chicken sandwich. However, when it comes to breakfast, McDonald’s is the company that is not to be competed with; in terms of other fast food establishments. 

McDonald’s is definitely the fast food leader of breakfast menus, so much so that in 2015 they started serving their breakfast items all day. So it makes sense that, as a company, they decided that if they wanted to contest with the likes of Popeye’s, they would need to play to their strengths; in this case, that would be breakfast. Other fast food establishments, such as Wendy’s, are following in the same footsteps in terms of breakfast, but the individuals working in corporate aren’t too concerned. 

“We’ve seen competitors … ramp up their activity during this year. Breakfast is an important segment for us to protect and grow. We’re used to fighting for our share, and we’ll carry on doing that,” former McDonald’s CEO Steve Easterbrook said.

McDonalds Sign

McDonald’s Chief Executive Steve Easterbrook Fired Over Relationship With Colleague

Fast food giant McDonald’s has fired its Chief Executive Steve Easterbrook following revelations of an affair with one of his colleagues, with the successful businessman admitting that he had made a ‘mistake’ regarding his conduct.

Despite both parties consenting to the relationship, the company deemed that Mr. Easterbrook had violated their company policy. It has been disclosed that he is likely to receive around 26 weeks pay against an estimated $16m annual salary and additional bonuses could see him pocketing somewhere in the region of $35m. As part of the exit arrangement, Mr. Easterbrook is not permitted to work for a competitor for a minimum of two years.

News of his departure was circulated to McDonald’s staff via an email in which the 52 year old admitted that he had made a mistake with regards to his conduct. The personally written email also said that he agreed with the board and that it was ‘time to move on’.

British-born Mr. Easterbrook first began working for the company back in 1993, taking up the position of manager in London. After working his way through the ranks, he left in 2011 to head up the popular restaurant chain Pizza Express, before moving on to Japanese restaurant chain Wagamama. However, in 2013, he returned to McDonalds to undertake the position of Head of UK and Northern Europe before becoming Chief Executive in 2015.

Mr. Easterbrook stepped down after the board voted on the matter, also relinquishing his roles as president and member of the board. Their view is that the company has long upheld rules regarding conflict of interest which were clearly ignored by Mr. Easterbrook when he decided to embark on a relationship with a fellow colleague. He was immediately replaced by McDonald’s USA president Chris Kempczinski.

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Many companies have such rules in place regarding relationships or at the very least require parties to disclose any romantic relationships that are occurring within the workplace. Experts say that the main driving factor is to avoid litigation caused by disgruntled partners if the relationship ends badly.

Observing the story unfolding, successful businesswoman and relationship expert Stephanie Tumba, author of ‘100 Dates and a Wedding’ commented:

“When you think how difficult it is to find love nowadays and that 1 in 5 couples meet at work, my view is that this decision was perhaps a little harsh and old-fashioned. Bear in mind that Bill Gates met his wife in the working environment, this stuff happens all the time. People shouldn’t lose their jobs and livelihoods over it.

Today, we live in a much freer world, a far cry from William Shakespeare’s forbidden love stories. Over the years, many taboos surrounding love and relationships have been lifted in most industrialised countries, and it would be naive to think that relationships are not blossoming between colleagues on a daily basis.

Embarking on a romantic relationship within the workplace means maintaining discretion and etiquette as a given. However, I think that sanctioning against such relationships can no longer be the default position. Employers should invite the employees to discuss this situation and then decide how to best deal with it. Whether it’s making them work in different departments and/or legally framing the situation.

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Of course, one can understand that an employer would be concerned that the behaviour of the couple could cause reputational damage to the organisation and create tensions between individuals, teams or departments. Even more so when one of the parties is in a prominent leadership position.

Whilst it is essential that a certain level of conduct is maintained in the working environment, I do not think that organisations can continue to contractually prevent people from nurturing romantic relationships with their colleagues.

Naturally, some inter-work relationships have ended badly. The relationship between President Bill Clinton and his intern Monica Lewinsky lasted for over 18 months and almost led to him losing his job. Several other politicians have found themselves in similar circumstances, all having potentially damaging implications for both the individual and the organisation, country or party they represent.

However, Stephanie’s comments appear to be mirrored in a growing number of people who appear to have no problem with an office romance. A recent survey revealed that 75% of those questioned believed that romantic relationships at work were not problematic. This view was also supported by research which reveals that over 30% of office romances lead to marriage.

In fact, Barack and Michelle Obama first met at a Chicago law firm, after Michelle was given the task of mentoring the firm’s new summer intern, Barack. Despite rejecting his advances at first, over fear that the only two African-Americans in the office dating would appear ‘tacky’, she eventually relented, getting married just four years later.