How Restaurant Brand International's CEO plans to turn around Burger King
Restaurant Brands International (QSR) CEO José Cil is ready to get cooking when it comes to Burger King's “Reclaim the Flame” plan to accelerate growth in the United States.
"It's a really exciting moment for us at the Burger King brand here in the U.S. ... We've spent the last 9 to 12 months with new leadership at Burger King in the U.S., working closely with our franchisees on building a plan to engage them, the broader system, our team members, and our guests on our path and plan to reclaim the flame," Cil told Yahoo Finance.
The $400 million plan to bring Burger King into the future will rollout over the next two years. It is comprised of $150 million in advertising and digital investments to “Fuel the Flame” and $250 million for a “Royal Reset” involving restaurant technology, kitchen equipment, building enhancements, remodels and relocations.
This plan comes a year after the company expanded its Royal perks loyalty program to two-thirds of restaurants.
According to the release, the plan was endorsed by Burger King Franchisees, representing 93% of all U.S. restaurants, who have agreed to co-invest in increased advertising in the next few years. Cil is confident this funding will modernize the nearly 70-year-old Burger King restaurant portfolio.
He says the major investment is "confirmation and validation that we have conviction behind this plan and behind the team and behind the BK U.S. business and brand."
In the fiscal second quarter, Burger King's same-store sales were up 13.2% and up 35.8% year-over-year. Net restaurant growth lagged behind its fellow names under the Restaurant Brands International umbrella, up 2.8%, lower than at Tim Hortons, up 5.7%, and Popeye's, up 8.1%.
Shares of Restaurant Brands International are down 7 percent compared to a year ago.
Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at [email protected].
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