Dive Brief:
- Wendy’s has named Robert D. Wright as its president and CEO, effective May 21, according to a Wednesday press release. He is also joining the company’s board of directors.
- Wright previously served as president and CEO at Potbelly for over five years, during which time he oversaw a turnaround of the brand. He resigned from his post in December following Potbelly’s sale to RaceTrac.
- Wright’s turnaround experience could be particularly helpful at Wendy’s, which has faced several quarters of same-store sales declines, store closures and pressure from an activist investor. Wendy’s is about seven months into its own turnaround plan, Project Fresh, which launched in October.
Dive Insight:
Wright succeeds Ken Cook, who has served as interim CEO since Kirk Tanner’s departure last year. Cook will return to his previous role as CFO.
Wright led a period of growth at Potbelly by expanding its footprint, particularly through franchising, and helped develop a fast-growing digital platform. In September, Potbelly agreed to a $566 million acquisition by convenience store brand RaceTrac, which it said would help it push towards its 2,000-store development goal.
Wright is familiar with Wendy’s, serving as the chain’s executive vice president and chief operations officer, prior to joining Potbelly. He has worked in various leadership posts at the fast food chain during his career, which also includes working at Charleys Philly Steaks, Checkers Drive-In Restaurants and Domino’s, according to the a U.S. Securities and Exchange filing.
But Wright will face considerable challenges as he returns to Wendy’s. The burger chain’s U.S. same-store sales have fallen significantly across five quarters, including a 7.8% decline during the first quarter of this year. At the same time, both McDonald’s and Burger King have seen meaningful growth in their sales, putting Wendy’s in a disadvantageous competitive position.
Wendy’s has made a number of adjustments in an effort to arrest the decline. At the start of the slide, the brand decided to narrow the focus of its promotional messaging and marketing calendar and announced the debut of new chicken tenders.
In October, Wendy’s reallocated $20 million from store development efforts to marketing and store-level improvements in training, equipment and technology.
Earlier this year, the brand granted its franchisees greater discretion in determining their hours during the morning daypart, as breakfast sales softened. That move was meant to make it easier for operators to focus on operations during the day, evening and late night periods, all of which were performing better than breakfast.
Currently, the chain is prioritizing order accuracy — supported by new item label printers — and store cleanliness.
Wendy’s is in the process of closing a significant number of underperforming locations to strengthen the performance of its portfolio. But closing is only one option available for ailing units. In November, Cook said the chain would consider actions ranging from operational investments, deploying new technology or transferring stores from one franchisee to another in order to improve unit economics.
