The Fast Growing Chicken Wing Chain That's Giving Buffalo Wild Wings a Run For Its Money


Source:  Wingstop

Look out, Buffalo Wild Wings (NASDAQ: BWLD  ) . Wingstop may be small and privately-held now but the chain is accumulating spicy wing fans faster than the time it takes to down a pint during the Super Bowl. I know what you're thinking; Wing Stop is a limited-service chain while Buffalo Wild Wings is a full-service sports bar. Guess what -- Wingstop is becoming that too.

Wingstop Sports
I'm not just referring to the fact that many Wingstop locations do indeed serve draft beer and, of course, wings. That alone makes it a competitor to Buffalo Wild Wings for at least some customers, but Wingstop seems to be migrating toward a match-up in the sports arena with its larger competitor.

Source: Wingstop

Back in 2011, Wingstop announced it was test marketing a new fast-casual concept called Wingstop Sports. The place has more room, more food items on the menu, more beer choices, and of course more giant TVs to turn the place into a sports bar.

Bill Knight, COO of Wingstop, stated at the time, "This isn't a bar; we're not trying to be a Buffalo Wild Wings, but we obviously don't want to compete with ourselves either."

Um, yeah. Wings, beer, and sports. Obviously Wingstop Sports directly competes with Buffalo Wild Wings. It's OK to admit it, Bill. 

Sounds like the testing went well
Wingstop Sports locations seem to be slowly but surely popping up here and there. For example, one opened up in Las Vegas. Another did in Orange, California. At least two more have opened up in the same general area as the original test location in South Texas which included one in the town of Elsa just this past June 20.

Source: Wingstop

The reviews on Yelp gave the Orange location 3.5 stars. There are also 10 Buffalo Wild Wings restaurants within the vicinity of that Wingstop Sports and all 10 of them got lower ratings from reviewers. If you check out the reviews of Wingstop Sports on other sites, you will notice a similar pattern of rave reviews.

Why Buffalo Wild Wings should worry
So far Wingstop only poses a very small threat to Buffalo Wild Wings and that comes from the chicken itself. However, given Wingstop's eye-popping success lately in terms of growth percentage, that chicken threat could become one from the sports bar and beer business as well if Wingstop starts rapidly rolling it out.

Meanwhile, Buffalo Wild Wings is no slouch on the growth scale. The chain snagged the No. 9 spot on the list of top growth restaurant chains last year according to a report by National Restaurant News. However, guess which one grabbed the No. 3 spot? Yup, it was Wingstop.

Source: Wingstop

Habanero-hot growth
Wingstop grew systemwide sales by a staggering 19.8% last year alone. Sales per unit jumped 9.1% while its unit count leaped 10.5%. Buffalo Wild Wings had an almost identical unit growth rate, but sales per unit only tacked on 3%.

Meanwhile, Wingstop boasts that it has tacked on over 10 years of same-store sales growth and reported same-store sales growth of 9.6% in the first quarter of this year. That's faster than Buffalo Wild Wings at 6.6% for its company-owned spots during the same period.

Wingstop has grown to over 600 locations since its founding in 1995 while Buffalo Wild Wings has reached over 1,000 since its founding in 1982. If history is any guide, both are very capable of long-term rapid growth but Wingstop Sports could still potentially take a serious bite out of some of Buffalo Wild Wings' business. 

Leaked: Apple's next smart device (warning, it may shock you)
Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out, and some early viewers are claiming its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early-in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!


Read/Post Comments (2) | Recommend This Article (50)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On July 27, 2014, at 3:34 PM, GeaugaTruck wrote:

    This article does not give sauce flavor comparisons nor does it give price comparisons. Both of these factors greatly influence wing sales in our community.

    Winking Lizard is a competitor in this part of the country and draws a large following as well.

  • Report this Comment On July 28, 2014, at 9:39 AM, cbergquist2 wrote:

    Wingstop blows Buffalo Wild Wings out of the water when it comes to flavor! Glad to see Wingstop stepping their game up even further!

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 3037141, ~/Articles/ArticleHandler.aspx, 11/23/2014 3:15:24 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement