Wingstop’s System-Wide Sales Increase 37%

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Digital sales soar to 64% of system-wide sales, and for fiscal Q2, total revenue increased 36.1% to $66.1 million.

Wingstop’s System-Wide Sales Increase 37%

By Anna Wolfe - 08/03/2020

Wingstop has posted results for another enviable quarter.

  • For fiscal Q2, total revenue increased 36.1% to $66.1 million.
  • Same store sales increased 31.9%
  • System-wide sales increased 37.0% to $509 million
  • Total revenue increased 36.1% to $66.1 million
  • Plus the wing brand had 23 net new store openings
  • Domestic same store sales increased 31.9%

A full earnings report is available here. President & CEO Charles Morrison gives partial credit to recent digital investments.

 “…We have made such investments in our digital and delivery capabilities that it's so easy to access our product,” said CEO Charles Morrison in an earnings call with analysts. 

Shifting Towards Order Ahead

Delivery has doubled in the past year to about 30% of sales. The brand kicked off Q2 with a free delivery promo. After the promo expired, Wing Stop customers have been embracing order ahead vs. paying for delivery. 

”…We have seen a little bit of an uptick in the digital carryout business,” said Michael Skipworth - EVP & CFO.  What helped sustain that momentum was launching a $19.99 bundle offer as the free delivery expired. “So we introduced something else in the mix, if you will, to provide value to guests, which helped continue to drive the growth that we saw,” Skipworth added.  

Marketing

Unlike McDonald’s which has delayed marketing spend until the end of the year, Wing Zone has continued to invest in outreach.

“We did not cut back against our original advertising plan, which was an increase, if you think about how system sales grew year-over-year, north of 20%, we spent the planned dollars,” said Skipworth. “We obviously pivoted on where we spent those, but we spent against budget. And I think what we've talked about earlier is this strong top line growth is actually bringing more dollars into the ad firm than originally planned.”

The brand continues to open new locations and plans to open more ghost kitchens. “The concept of a Ghost-Kitchen makes sense for our business,” said Morrison. “In fact, we opened 2 ghost kitchens over the past 2 months outside the U.S. We've also opened them here in the U.S. And right now, we're in a mode of really understanding what those look like, so that we get an idea of how they start-up, how we gain traction, and ultimately, how they perform … So all in all, we think that's a great strategy to place these in areas where we otherwise would not have put one of our traditional retail locations.”

Not on the Schedule

Wing Stop’s dining rooms remain closed, and there are no current plans reopen for dine-in. “We were the first to close and the last to open. Because we do feel like it's in the best interest of our guests as well as our team members from a safety perspective to make sure that there's as little interaction as possible,” said Morrison. “It doesn't present a labor opportunity or problem one way or the other, quite frankly… More importantly, it's about safety and taking care of our guests.”