Wendy's sees opportunity in the A.M.

By Jeremiah McWilliams

The Atlanta Journal-Constitution

When was the last time you went to Wendy's for breakfast?

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AP Photo/Terry Gilliam, File Wendy's is calling breakfast its biggest opportunity. An expanded menu is being tested in select cities nationwide.

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Okay, it's a trick question. By its own reckoning, Wendy's is one of the only fast-food chains not serving breakfast nationwide.

With as much as $150,000 in sales at stake at each location, Wendy's is trying to change that, calling breakfast its biggest opportunity. An expanded menu -- including oatmeal bars, egg sandwiches, paninis and burritos -- is being tested in Pittsburgh, Kansas City and Phoenix.

Wendy's, a division of Atlanta-based Wendy's/Arby's Group, will spend about $8 million this year to advertise its new breakfast menu in the test markets. The goal is to let consumers know about the expanded menu and to get franchisees to embrace the breakfast program, which Wendy's hopes to start rolling out nationally late next year, said chief financial officer Stephen Hare.

Wendy’s had a national breakfast menu in the mid-1980's, with items such as omelets, French toast and toasted sandwiches. But the items took too long to prepare and serve, and the chain discontinued the menu. In 2006, the company again began testing a new breakfast menu in a limited number of locations.

About 25 percent of traffic to fast-food restaurants is for breakfast. Wendy's gets only about 2 percent of its sales from breakfast served at places such as truck stops and airports. Breakfast accounted for nearly 60 percent of the restaurant industry's traffic growth during the past five years, according to The NPD Group.

As fast food chains grapple with high unemployment and a trend of people eating out less, Wendy's aims to change eating habits. There are obstacles. Consumers are generally much more creatures of habit at breakfast than at lunch, when they are more willing to try new things, Hare said. Also, breakfast can take away from sales during other parts of the day, and can also raise costs for ingredients and labor.

Meanwhile, McDonald's devotes significant advertising dollars to breakfast, and Wendy's will have to gear up for a battle, Hare acknowledged.

"There is a tremendous opportunity, we think, to break in," he said.

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