Restaurant Brands International (NYSE:QSR) announced its Burger King chain would add hot dogs to its national menu later this month, not as a limited time promotion, but as a permanent item.
Does it matter?
Burger King says over 20 billion hot dogs are eaten every year and putting them on the menu at all 7,100 of its restaurants means it will be the largest restaurant chain selling them. Nathan's Famous (NASDAQ:NATH), which largely sells nothing but hot dogs, has only 267 stores in 23 states, while Sonic (NASDAQ:SONC), which sells hot dogs, coneys, and corn dogs along with burgers and chicken, has just over 3,500 locations.
It's a low-risk addition, too. Sonic has found simply reveling in the decadence of its burgers, fries, and, yes, dogs keeps sales growing by leaps and bounds. In its fiscal first quarter earnings results, Sonic said same store sales jumped 5.3% helping profits rise 33%.
Hot Dogs are a popular food item that Burger King says shouldn't be "relegated to summer barbecues and baseball games." They likely won't displace burgers, as just the big three burger joints sell tens of billions of dollars worth of patties every year, but they do promise to provide a point of differentiation.
The problem is, Burger King is so synonymous with burgers -- and its name doesn't help -- that becoming a hot dog king is not likely to happen.
Rich Duprey has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.