Once high-flying, fast food stocks now appear to be falling on higher beef and bread costs. CKE Restaurants CEO Andy Puzder joins the panel for this conversation and reveals how he's addressing the challenge. Following is a summary of his main points.
How are you dealing with increasing commodity prices?
“As time goes on, everybody is adding price,” replies Puzder. With the minimum wage hike, and then the huge commodity increases you couldn’t take it all at once. But over time everyone is taking it.”
How are you competing with those discounts being offered by competitors?
"Our competition is going to these 99 cent gut fillers,” replies Puzder. “For us that’s great because anytime our competitors go in a direction toward gut filling food, we can go toward premium value and distinguish ourselves.”
“We promoted a portabello mushroom burger with a bunch of Wall Street guys around a table. At the end of the ad it says portabello mushroom burgers, $5 at Carl’s. $20 everywhere else. So we have value but still have a premium product.”
What are your plans for growth?
“Last year for the first time this decade we had positive unit growth,” replies Puzder. We grew about 74 units which was good for the company. Half of that was international…We will have a big emphasis this year on international growth. I’m going to Dubai to meet with our franchisee who has 150 restaurants!”
Traders, what do you think?
Two more months of strong same store sales and I’d be a buyer, says Jeff Macke.
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