Arby’s Is Buying BW3’s. What’s It Mean To You In Kalamazoo?
Monday morning we woke to the news that Arby's was buying Buffalo Wild Wings. One big corporation swallowing up another, this time to the tune of $2.4 billion. But it's not just about putting "horseysauce" on your chicken wings. (though you ought to try it. It's really good.)The company doing the buying is Roark Capital. They also own Jimmy John's, Cinnabon.and a bunch of other places you've probably eaten at. And did you know Wendy's owns just under 20% or Arby's.
Here's some of what the company that owns Arby's owns:
Our largest sector, food and restaurants, encompasses 21 investments in brands such as: Arby’s, CKE Restaurants (the owner of Carl’s Jr and Hardee’s), Corner Bakery, Culver’s, FOCUS Brands (the owner of Auntie Anne’s Pretzels, Carvel Ice Cream, Cinnabon, McAlister’s Deli, Moe’s Southwest Grill, and Schlotzsky’s) Il Fornaio, Jim ‘N Nick’s BBQ, Jimmy John’s, Miller’s Ale House, Naf Naf Grill, and Wingstop.-Roark Capital website
Here's what maybe makes Buffalo Wild Wings desirable to Roark. This piece talks about the rising price of chicken wings. Wholesale prices have risen 20% this year, so it's getting harder and harder to make a profit on wings. It used to be the cheapest part of the chicken and if you threw sauce on them, and charged a bunch, you could make a nice profit. The problem is supply and demand. People love chicken wings. And chickens currently only have two wings per chicken. Another factor is what to with the rest of the bird. One solution has been "boneless wings", which are breast meat and other parts and have become as popular as the real deal.
This business model still sets up a bit of a dilemma. Two wings per chicken isn't changing anytime soon. I'm not a chicken expert, but it seems to me, that Wendy's sells chicken sandwiches, as do Culver's and Hardee's and even Moe's has a chicken bowl on the menu. Ahh. I may be onto something.
Attempt to contact the local BW3 franchisee were unsuccessful, but from everything you read about these companies, they have common ownership, but run pretty independently. So it may not mean much change to you and me. Still you have to believe maximizing how much you use of the chicken parts, within the corporate family, makes an awful lot of sense.
If the cost of wings were to come down a bit, or at least stop rising. I'm all for it. And don't get me started on a Cinnabon for dessert.