Burger King Case Study

Burger King, the second largest burger chain in the world with roughly 13,000 outlets in 86 countries, originates back to the early 1950’s. Approximately 97% of the total of all Burger King restaurants are franchised. The company accounts for roughly 12% of the total fast food hamburger sales in the United States (Market Line, 2013). With its headquarters based in Miami, Florida, Burger King over the years of its existence has made a strong effort to expand not only all over the United States but also globally.

Burger King has to compete with well-established food service companies such as McDonald’s and Wendy’s to go along with a slew of other restaurants that try to differentiate themselves from one another to gain a niche in which they can exploit. Burger King has to compete nationally and internationally based on product choice, quality, affordability, service, and location (Morning Star, 2013). Burger King had initial instant success with the introduction of their “Whopper” sandwich and its campaign. Although, the years prior to 3G Capital acquiring the company, Burger King experienced declining sales, lack of expansion, and a bland menu. The company and its restaurants appeal to a broad spectrum of consumers offering fast food at affordable prices. Burger King offers a limited assortment of food products such as flame-grilled hamburgers, chicken and other specialty sandwiches, French fries, soft drinks, and other food items.

To sustain future growth, Burger King needs a stronger effort in expanding internationally. Currently, the company is highly concentrated in the U.S and Canada that exposes them to many risk factors. It will be important for the future growth and profitability that Burger King successfully implement...

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...these refranchised are willing and able to meet such initiatives. Proper incentives should be offered to franchised companies in the form of reduced up-front franchise fees and limited-term royalty rate reductions to ensure that initiatives are met.

Another main strategy that Burger King should incorporate in their company is differentiating themselves more to their competitors. One area where Burger King can differentiate themselves from other companies is through their menu. Offering more products, that appeal to a broader consumer base will only result in positive sales and enhances the brand image.

To fully achieve the goal of a near 100% franchised business model there needs to be a reduction in the cost of entry for these Burger King franchises. In doing so, overhead costs will be reduced as well the company is able to grow with minimal capital expenditures.