Burger King USA is to spend $250m on a ‘Royal Reset’ over the next two years involving restaurant technology, kitchen equipment, building enhancements and high-quality remodels and relocations.
This investment will work to enhance ongoing franchisee investments to modernize the Burger King restaurant portfolio and focus on operational excellence.
A further $150m will be spent on advertising and digital investments to promote its menu and offer.
Tom Curtis, president of Burger King North America, said: “We are relentlessly pursuing a better experience for our guests. This is the driving force behind all the initiatives that we are executing collaboratively with our franchisees.
“Our plan is focused on a few important priorities — operational excellence, refreshed image, and enhanced marketing — that when put together, provide a superior experience for our guests.”
The $250m investment plan will include two important components. The first involves investing $50m of capital over the next two years alongside a comparable co-investment from franchisees in a restaurant refresh program touching 3,000 restaurants across restaurant technology, kitchen equipment, and building enhancements.
These investments are designed to ensure its restaurants are ready to deliver an exceptional guest experience as it works to drive traffic back to the system aided by its menu enhancements and advertising investment.
In addition, Burger King is launching a Royal Reset remodel program that provides access to $200m of funding for 800 restaurant remodel projects over the next two years.
As part of this program, the company is changing its incentive structure, which has historically focused on advertising and royalty rate discounts for up to seven years.
The Royal Reset remodel program is designed to improve returns on capital for its franchisees by providing more substantial baseline incentives, access to additional contributions in exchange for a higher royalty rate election, and funding of these incentives in upfront cash at the time of remodel completion.
Burger King said the program will also offer greater financial support to better operators, adding further incentive for franchisees to improve operations across the system.