Case Interview Question #00240: The client Wendy’s Old Fashioned Hamburgers (NYSE: WEN) is a fast food chain restaurant headquartered in Dublin, Ohio, United States. With approximately 6,650 store locations (as of March 2010), Wendy’s is the third largest hamburger fast food chain in the US after McDonald’s and Burger King’s.
In the last five years the company was experiencing rapid growth. They had acquired several new locations and reapplied their business model in those new stores. They were disappointed that some of the stores seemed to do well, while others were barely breaking even. How would you go about investigating this problem?
Additional Information: (to be given to you if asked)
- Wendy’s older stores were in predominantly lower income neighborhoods.
- The underperforming new stores were actually selling more product per customer, but were attracting far fewer customers per store.
- While the chain sets standards for exterior store appearance, food quality and menu, individual store owners have control over hours of operations, interior decor, pricing and staff uniforms and wages.