Wendy’s unveils its full breakfast menu

Betting on breakfast

Wendy’s is optimistic that this entry into breakfast will be better received than last tried it several years ago.

For starters, Wendy’s worked closely with franchises this time around and created a menu that doesn’t require new equipment. Franchises had to spend upwards of $10,000 on equipment the last time it offered breakfast.

Breakfast was also previously only offered in parts of the United States, but now Wendy’s is planning a full nationwide roll out with a major advertising campaign. Only three employees are needed to work the shift, which is one fewer employee than last time.

Wendy’s plans to hire about 20,000 US employees and spend $20 million on the initiative. The company said it has a “big opportunity” to enter the space because it’s one of the few growth markets for the industry, according to food industry group NDP. Late night is also growing, but not as fast.

If all goes well, Wendy’s forecast breakfast sales to encompass 10% of its daily sales. But it doesn’t expect breakfast to be profitable until 2021.

Analysts have been skeptical of Wendy’s breakfast ambitions because of the costs.

“We are cautious on the prospects given the required upfront investment but uncertain payoff, additional labor needs at a time of already low availability, necessity to take market share from established competitors like McDonald’s and general difficulty of daypart expansion in the industry,” BTIG analysts said in a note released in September.

The stock

Its full earnings report will be released on November 6. The stock is up more than 35% for the year.