Wendy’s plans to introduce dynamic pricing for its fast-food offerings starting as early as next year. The chain will initiate testing of the new pricing system in some U.S. restaurants initially, with no immediate plans for implementation in Canada.
Dynamic pricing, also referred to as surge pricing, involves setting flexible prices for products and services based on market demand fluctuations. This approach, famously employed by companies like Uber, adjusts prices higher during busy times and lower during off-peak periods.
Wendy’s aims to enhance its digital business by investing in technology, including the implementation of dynamic pricing. This investment will enable easier menu changes and the provision of discounts and value offers to customers through innovations such as digital menu boards.
The company intends to leverage dynamic pricing to drive sales during slower parts of the day and consider factors like weather in pricing decisions. Plans include testing AI-enabled menu changes and suggestive selling features by as early as 2025 to improve customer and crew experiences.
CEO Kirk Tanner highlighted the benefits of this technology during a recent conference call, emphasizing its potential to support sales and profit growth across the Wendy’s system. The company plans to invest approximately US$30 million to roll out digital menu boards to all U.S. company-operated restaurants by the end of 2025, with enhancements planned for the global system over the next two years.
Tanner, who assumed the role of CEO earlier this month, succeeded Todd Penegor. Under Penegor’s leadership, Wendy’s announced a restructuring aimed at accelerating decision-making and increasing investment in new restaurant development, particularly internationally. Wendy’s operates approximately 7,000 restaurants worldwide.
In trading on Tuesday, Wendy’s shares experienced a slight decline.
