McDonald’s chicken sandwich
Source: McDonald’s
McDonald’s is trying to win the chicken sandwich wars at lower prices, while Restaurant Brands International’s Burger King is still finding its strategy, according to a Credit Suisse report.
In August 2019, Burger King’s sister chain, Popeyes, started the chicken sandwich wars with the launch of its own version of the menu item. Social media users opposed Chick-fil-A, and Popeyes’ sandwich quickly became a hit, boosting double-digit sales in the same store and adding about $ 400,000 in annual sales to each location.
“We expect competition to heat up in 2021 as brands in several segments raise their bids to take a bite out of the chicken category and improve their competitive position,” Credit Suisse analyst Lauren Silberman wrote on Friday.
McDonald’s is ready to release its own version on February 24, and Yum Brands’ KFC will launch one nationwide by the end of the month. Burger King is still in the testing phase.
McDonald’s new Crispy Chicken Sandwich undercuts its main rivals, according to Silberman. The burger chain sandwich is priced from $ 3.49 to $ 3.69 in the test markets, compared to Chick-fil-A’s $ 3.75 sandwich or Popeyes’ $ 3.99 version.
McDonald’s may have learned a lesson from his latest foray into chicken sandwiches. His crispy chicken sandwich, which was first launched in 2015, was at a premium price.
Silberman estimates that restaurants in McDonald’s test markets sell an average of about 125 to 150 crispy chicken sandwiches a day. If restaurants reach the top of that range when the item is launched nationwide, then the sandwich could increase the company’s sales in the same store by 4%, according to Silberman.
Burger King, on the other hand, seems to be further developing its pricing strategy. Silberman wrote in the note that one of his test markets is that the price of the new sandwich is $ 5.29, well above its rivals. But two other test markets have the price of the sandwich at a discount, ranging from $ 3.49 to $ 3.89. In markets that do not test the new sandwich, the burger chain usually charges more for its current chicken sandwich.
To date, Burger King restaurants sell an average of about 60 to 75 chicken sandwiches a day, according to Credit Suisse. The new sandwich could increase sales in the same store by up to 4% if it sells 75 sandwiches per restaurant when it is launched nationwide.