Wendy's beefs up menu options, some prices

Wendy's no longer thinks a hamburger has to be 99 cents to be a deal.

The fast-food company known for its Frosty shakes and square burgers has replaced its 99-cent value menu with a beefed-up array of options called "Right Price Right Size," with items ranging from 99 cents to $1.99. At a time when costs for meat, cheese and other ingredients are rising, the revamped menu is intended to give budget-minded diners more options, while giving Wendy's more flexibility on pricing.

The switch to the "Right Price Right Size" value menu reflects the cost pressures facing fast-food chains. Burger King and McDonald's have already moved past the $1 price point, offering tiered value menus that go up to around $2.

When it was introduced a decade ago, for example, McDonald's Dollar Menu included the Big 'N Tasty burger made with a quarter-pound beef patty. But the Dollar Menu has gotten skimpier, with small fries being taken off the roster last year.

To ensure the profitability of its new value menu, Wendy's tinkered with the lineup and in some cases raised prices. The Junior Cheeseburger Deluxe now costs $1.19, instead of 99 cents. And for 99 cents, customers now get four chicken nuggets, instead of five. The plain Junior Cheeseburger, which had been taken off the menu, is back at 99 cents.

In all, there are now seven items that cost 99 cents on the new value menu, down from nine.Although items on value menus tend to be less profitable, they play an important role in attracting customers who often end up spending more on other items. In testing over the past year, the "Right Price Right Size" menu not only boosted customer traffic, but also increased the average check size, said Craig Bahner, chief marketing officer for The Wendy's Co.

"It grew because those customers tend to buy multiple products," Bahner said, noting that the "vast majority" of customers who ordered off the value menu bought items from the regular menu as well.

-- AP