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The Wendy's Company Message Board

  • investor98765 investor98765 Feb 12, 2000 7:22 PM Flag

    You are right

    Wendy's is a blue collar stock, but who cares? Under $20, it's a steal. Make a profit in it, and then go and buy a high-end company like Tiffany's or Sotheby's.

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    • New unit growth too fast was why BOS crashed
      IMHO. WEN is the most labor intentsive chain I know of
      in this sector. God help WEN if Dems. get another $1
      increase in minimum wage.
      I will not ramble, but labor
      is a supply and demand issue. I am brainwashed as to
      that.

      Best of luck to all in market Mon.

    • With high wage pressure, Wendy's really should be concentrating on productivity growth and increasing same store sales, not on building new stores.

    • I know for a fact that labor costs, as well as
      the costs of replacing trained labor, is a primary
      concern in many (if not all) Wendy's markets. Large
      supply of jobs relative to availability of labor creates
      a lot of turnover. Consequently, you are always
      eating non-productive time in battling the learning
      curve of new employees. At the same time, you are
      paying premium price for unskilled labor. All low-tech
      employers are battling the problem right
      now.

      Wendy's is an excellent company that pays extremely close
      attention to costs. The whole restraunt/fast food industry
      is having hard times (share price wise). The good,
      proven ones will be here for the better times...Wendy's
      has superior product and management. My opinions
      (based on a good deal of expert testimony).

    • Supermarkets are unionized and fast food is
      not--YET. As a result, Supermarkets have to pay $15/hour
      for a job that's worth $5/hour, and so none of them
      make any gross margin.
      Fast food isn't there yet,
      but every time the labor supply tightens the
      profitability goes down. Many areas in the country have to pay
      $7/hour to attract minimum wage help. That is only one
      problem with fast foood in general and Wendy's in
      particular. The other factors are slow growth,
      oversaturation, inability to expand internationally, and the 99
      cent price point items that takes up over 40% of WEN's
      menu, for which there is no way to raise prices.

    • A well-off businessman I know (not stock expert)
      works in the retail supermarket business. His 'opinion'
      is that rising wages of workers prevents
      profitability unless prices of food increase to match (would
      would drive down sales). He feels wager pressure is
      killing Fast Food business.
      May be valid argument. I
      happen to like Wendy's and bought stock last week. I
      think Wendy's has superior product and can capture
      market-share.
      Does anybody have counter-argument or
      confirmation of my friend's opinion??

    • There is a Tim Horton's/Wendy's "combo" about 20
      miles from where I live. I've not been to it myself,
      but a fellow who works for me has.

      He said he
      was pretty impressed. This guy is an
      operations/management analyst by profession and manages his own
      portfolio. He said the quality was good, place looked sharp,
      etc.

      In many or most markets, Wendy's does not have a
      breakfast menu. Tim Horton's opens up a new market (of
      sorts) for Wendy's.

      Don't know about the rest of
      you, but I'm not a fan of Dunkin Donuts or Krispy
      Kreme.

    • Any company can say a chain like Horton's will
      eventually work--but how long will they need to investment
      spend to educate the public? The fact is that the Tim's
      CONCEPT--and in the US it is still a CONCEPT--has not made any
      money in the US. Most new restaurant concepts, if they
      are successful, are successful immediately and use a
      solid base of profitable units to finance future
      expansion and attract franchisees. Recent examples: Outback
      Steak House, Hooters, Krispy Kreme Donuts, Macaroni
      Grill, Starbucks--I don't see any of the dynamics in the
      US that would indicate that Tim Horton's will catch
      on like any of these. A clear signal of failure is
      when management keeps saying stuff like "the products
      are great", "we need to give it some time", "it will
      eventually catch on"--sorry, but this is wishful thinking.
      Can anyone think of a chain that started slow and
      then caught fire? Normally they start out like fire
      and MAYBE they'll be around in 5 years. If you don't
      start out strong, there's little hope for success.

    • Boy, am I going out on a limb. I was surprised by
      outlet #'s of 67. Did not think they were at that point
      yet (I would have thought labour tightness in
      mid-west would have held back expansion). I have seen a
      total of 3 outlets (off interstate) in Michigan and
      Ohio and they look same as Canada, though both were
      partnered with a Wendy's (probably associated to help
      develop brand recognition in the US). The co-brand is
      relatively new to Canada and in itself is of no significance
      to the development of Tim's in our marketplace. If
      management has wherewithall they will focus on markets (Ohio
      and Michigan are perfect) and push outlet development
      (stand-alone Tim's), and develop the brand. The nice thing
      about baking is one Tim's supports a few less capital
      intensive satellite operations (that is why they reproduce
      like rabbits up here). I have not seen this in the US.
      You want growth, accept the risk, it may take time
      but Tims will appeal.--- Any US store managers care
      to comment, how is traffic development? The key is
      morning coffee business, it becomes a habit. What
      promotion/advertising are they running in Michigan/Ohio market? In
      Canada they promote heavily and their top of mind brand
      kills others (the Canadian landscape is littered with
      the remains of other donut/coffee shops). What is a
      Dunkin Donut?

    • They are in Ohio, West Va, Michigan, and upstate NY--look it up on a phone search and call one of the managers--ask him how sales are. They'll tell you more than you want to know.

    • Somebody who lives in the upper midwest--help
      with the facts--aren't there about 100 company owned
      units in Michigan or Minnesota that were built from
      scratch to test the Tim's concept in the US? I seem to
      recall from previous posts and talking to store managers
      that sales were way below
      expectations--translation--IT'S NOT WORKING IN THE US. This is very common in the
      fast food business where a chain has great business in
      some areas and totally fails in others. Carl's Jr. is
      an example--great business in California, business
      sucks elsewhere. In net, the development objective was
      to expand Horton's in the US successfully and
      possibly merge it with Wendy's as a co-branding vehicle.
      WEN has failed to achieve either objective and the
      concept remains a Canadian cash cow--sorry, but the
      $450mm acquisition cost was not justified to buy a cash
      cow.

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