Restructuring / Turnaround Strategies Case Study

Snags in Wendy's

Abstract:
In 2005, the fast food industry in the US witnessed 5% increase over that of the previous year. However, due to ineffective ads and stiff competition, Wendy’s incurred a loss of $29.1 million. Wendy’s was the third largest burger chain in the world after McDonald’s and Burger King. Since 2002, due to the price war between McDonald’s and Burger King and the death of Dave Thomas, the founder of Wendy’s, it witnessed a decline in its market share. After reviewing the market condition, the company came out with a turnaround plan. Wendy’s decided to reinvigorate its core products and to improve its service. It also planned to cut overhead costs by $100 million. With McDonald’s introducing new products, analysts were skeptical about Wendy’s revamping plan. Would Wendy’s succeed in its endevors?

Pedagogical Objectives:

• To understand the fast food industry in US
• To understand Wendy’s growth in US
• To understand the challenges of the fast food industry in US
• To analyse whether Wendy’s turn around plan work.

Keywords : Origin of Wendy; System wide sales of Wendy's; Advertising awareness; Market share of Wendy's; Quality score of leading burger chain; Restructuring / Turnaround Strategies Case Study; Wendy's sales (2000-2005); Challenges; Competitors; Next Chapter of Wendy's; Wendy's turnaround plan; Moving ahead