Wings. Beer. Sports. That’s the focus for Buffalo Wild Wings (BWLD), which has managed to rise about 40% in the last year compared with a flat S&P (^GSPC). And with the football season just kicking off, that means a lot of time will be spent eating chicken wings and drinking beer...
CEO Sally Smith explains that the football kick off remains an important traffic driver for the brand, but also that the company's broader sports promotions, including this summer's "The Blazin World of Sports" that highlighted under-the-radar sports, also drove customers to Buffalo Wild Wing's over 1000 locations.
"It's always important to stay fresh and relevant in the mind of the guest when you're thinking about where you want to go out to eat," says Smith. "So it's a combination of the environment certainly, our design, keeping the restaurants up to date and great television viewing. It's also about limited time offers that you can't get during some parts of the year."
Innovative products continue to whet consumers' appetite, as the company's sauce lab and specialty beers have translated into strong sales that can withstand the price increases that are being put into place to offset rising chicken wing prices, according to Smith. "Our wing prices are higher than they were a year ago," says Smith. "That combined with some of the labor increases we've seen from a rising minimum wage and other attributes does put pressure on."
Buffalo Wild Wings announced in their second quarter that there would be a price increase around the first of November but Smith is hopeful that there's room in their menu and pricing scheme to provide a great value to guests and that there won't be a big impact on traffic.
With a cited potential of 1,700 locations in the US, and a domestic focus, Buffalo Wild Wings remains well positioned for growth in the current environment.
