Why Taco Bell Won’t Win At Breakfast
April 30, 2014 Leave a comment
http://www.businessinsider.sg/why-taco-bell-wont-win-at-breakfast-2014-4/#.U2CwkYGSxLM
Why Taco Bell Won’t Win At Breakfast
BURGERBUSINESS.COM RETAIL APR. 29, 2014, 11:35 PM
Will Taco Bell’s breakfast program be a success? Well, yes, if the standard it uses is Woody Allen’s quip that “80% of success is showing up.”
“We’re not in it to be in breakfast; we’re in to win at breakfast,” Yum Brands Chairman- CEO David Novak told analysts last week. But what does Taco Bell mean by “winning”? Not much, apparently. The chain has set the bar low enough to guarantee success. But there’s a difference between “success” and “winning.” Taco Bell may well succeed, but is it going to be winning anything?
Breakfast represents about 25% of the average McDonald’s sales and 45% for Hardee’s. What is Yum Brands’ target for Taco Bell’s breakfast? About 7%. Novak told analysts this week that Taco Bell stores could see about $100,000 in incremental business as a result of breakfast. There’s nothing wrong with incremental business, to be sure. But given that the average Taco Bell does annual sales of about $1.4 million, $100,000 represents about 7%. That’s a terrific gain for Taco Bell operators in a slow-growth market, but it hardly adds up to “winning.” Not when the average McDonald’s is taking in $650,000 from morning business.