Another $300 Million
RBI, the parent company of Burger King, has announced it will invest an additional $300 million as it strives to remodel 1,100 fast-food restaurants located throughout the U.S.
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This investment is all part of RBI’s intent to bring a turnaround in sales for Burger King. So far, it appears their extra investments in Burger King have worked in RBI’s favor.
The Beginning of BK’s Strategy
This plan to revitalize Burger King began more than a year and a half ago. RBI declared that they would invest $250 million into Burger King.
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This money was fully dedicated to renovating and remodeling various Burger King restaurants around the country. These locations have seen an upgrade in equipment and technology, as well as a new modern facade.
Bettering Burger King’s App
However, that’s not all this initial $250 million was intended to do. This massive amount of money was also designed to better the fast food restaurant’s mobile app.
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This money also went to advertising, to help increase the amount of customer traffic seen at Burger King locations.
Seeing Results
Already, it appears that RBI has seen major results in its investments. Burger King’s U.S. President Tom Curtis explained how these early results have impacted business.
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“It was the first time in a long time that RBI had invested a significant amount of capital back into the business to co-invest with franchisees,” Curtis said. “I think the process was, ‘Let’s see how this works’… and we’re seeing early results on remodels.”
New, Remodeled Burger Kings
This remodeling process has resulted in about 100 Burger Kings already having a new, modern design. Already, sales have lifted in the areas where this revamping has been completed.
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As these updated locations have seen a rise in sales, RBI is hoping these increases in sales will continue as the rest of Burger King’s locations are revitalized.
A “Sizzle” Design
According to the company, these Burger King remodels all have a new “Sizzle” design. This new modern facade includes a brand new drive-thru pickup area for mobile orders.
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This revamping also has self-order kiosks for customers to order their chosen menu items themselves.
Buying Franchisees
This isn’t the only major move RBI has made recently. In January, RBI bought Carrols Restaurant Group, the U.S.’s largest Burger King franchisee, for $1 billion.
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Now, Burger King fully controls these 600 locations of Carrols’. This purchase was made to further speed up their remodeling goals for all Burger King locations.
Remodeling An Additional 600 Locations
Now that Burger King fully controls these additional locations, they have to remodel about 600 restaurants.
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To quickly get this done, RBI has estimated that they will spend about $500 million to remodel and update all 600 of these Burger Kings.
A $2.2 Billion Investment
In total, RBI has willingly invested about $2.2 billion in trying to revitalize Burger King throughout the United States.
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While the parent company may want to move quickly to revamp its many U.S. locations, it may be a few years before this whole strategy is completed. According to RBI, about 85% to 90% of all its restaurants in the U.S. should have a new, modern design by at least 2028.
Convincing Franchisees to Remodel
As remodeling can be an incredibly costly business move, Burger King is working to better convince its franchisees to shutter its doors temporarily to allow this reconstruction to take place.
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Franchisees who agree to remodel their Burger King locations will be able to receive money from the company once the remodeling is fully complete. In this way, Burger King is trying to incentivize its franchisees to remodel.
Continuing to Spread Influence
Though some franchisees may be willing to revamp thanks to this incentive, it appears others are holding out. As a result, Curtis revealed he would be going to various locations around the country soon to try to pitch this remodeling process to franchise owners.
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With this additional $300 million investment from RBI, Curtis hopes to further convince Burger King franchisees to remodel.