Wendy’s inks deal on 200 stores as McDonald’s eyes $1bn expansion

The Australian burger market is about to be shaken up by a cult American fast food chain famous for its square patties, dairy desserts, and odd shapes.

Wendy’s announced plans to open 200 restaurants nationwide by 2034 as the competition in the fast food market intensifies despite challenges with cost.

With 7,000 locations in the US, the burger chain ranks third globally behind McDonald’s.

Wendy’s will be partnering with Flynn Restaurant Group in the US, which is now the owner of Pizza Hut.

Wendy’s International President Abigail Pringle stated that the franchise was influenced by feedback received from a Sydney pop-up in 2021.

She said that Australia was a “strategic growth market” for Wendy’s, and she was confident Flynn would be the “right partner.”

In Australia, the US-based fast food consortium grabbed headlines in early this year when it purchased more than 250 Pizza Hut outlets.

Flynn operates thousands of restaurants, including Applebee’s, Arby’s, and Taco Bell, as well as 190 US Wendy’s.

Wendy’s, which opened in the US in 1969, is well known in Australia, but it has had a difficult time finding a foothold in Australia.

The first store opened in Melbourne, Australia in 1982. Three years later, it collapsed with 11 stores and a $3m debt.

Since then, many American fast-food chains have opened in Australia and are challenging the dominating mainstays such as McDonald’s.

Five Guys is a burger chain in Australia that has a cult-like following. It has stores in Penrith, Southbank, and other locations in Victoria.

Five Guys, which opened its first Virginia location in 1982, is famous for its simple burgers and milkshakes. They also serve fries with a cajun-style southern seasoning.

In-and-Out Burgers, a Californian brand, opened pop-up shops in Sydney and Melbourne in March 2022.

The queues for the pop-up shops were in the hundreds. Many people wanted to try one of their burgers.

The stores are a threat to the long-standing outlets McDonald’s & Hungry Jack’s but haven’t yet affected their sales.

McDonald’s Australia revealed last month its plans to expand by opening 100 new outlets across Australia as part of a $1bn plan.

The Australian quoted the ambitious 38-year-old Antoni Martinez as saying that McDonald’s had experienced a new wave of popularity.

He said that online delivery services like UberEats and reward programs had helped to revive interest in the classic Big Mac seller.

McDonald’s Australia has announced that it plans to upgrade and open up to 30 new stores in 2023, as well as opening as many as 30 additional stores.

By 2025, the fast food giant plans to open more than 1100 outlets across the country.

The AFR quoted Jack Cowin, founder of Hungry Jack, as saying that Wendy’s Australian ambitions were questioned given the company’s past failure.

The deal is not clear on how it will affect the 120 Wendy’s Milk Bars that are already open in Australia and New Zealand.

When Wendy’s announced its plans early this year, a Wendy’s Milk Bar franchisee said to The Guardian that “there couldn’t be two Wendy’s.”

This announcement is a result of Australia’s persistently high expenditure on takeout and fast food despite the cost of living.

The Australian Bureau of Statistics announced on August 3 that the spending on cafes, restaurants, and takeout had declined for the first year.

Since the first Covid lockdown in September 2021, spending on food other than groceries has increased. However, in August, it fell only by 0.1 percent.

The ABS warns that families are feeling the pinch as the cost of living increases.

Ben Dorber, ABS’s head of retail statistics, said that this is the first time in eight years that retail sales have fallen three quarters in a row.

Retail sales volume is down 1.4% compared to last June’s quarter.

This is the first year since 1991 that the sales volume has fallen in comparison to the previous one.