WHAT-A-CHANGE

Ken Hoffman digs into the juiciest questions after Whataburger's surprising sale

This article originally appeared on CultureMap.


The headline induced heart palpations in drive-thru burger fans across Texas and neighboring states … "Texas-based Whataburger sells to new owner amid expansion plans." While that sounds unsettling, the real concern is:

What does this mean to Whataburger's everyday (sometimes twice-a-day) customer in Texas?

In the immediate future — like tomorrow, next week, next year — probably very little. But in the long run, all bets are off. Most likely, there will be significant changes at your local Whataburger over the next three to five years.

Whataburger is now owned by a private equity company (Chicago's BDT Capital Partners), which may not know a Chop House Cheddar Burger from a Whatacatch Sandwich — and doesn't understand that when you're stuck in morning traffic on I-45, nothing beats a Honey Butter Chicken Biscuit.

That investment company bought Whataburger for only one reason: to make money. Shocking, that's what investment companies do. They are not fast food philanthropists. They're financial killers who want to see a return on their investment.

What's next?

So don't be surprised if they take Whataburger national. That's my big takeaway. It may mean Whataburger may have less Texas on its menu in the future.

The new owners are buying a very successful or stagnant company, depending on how you crunch the numbers. According to QSR Magazine, the bible of the fast food industry, Whataburger is only the No. 22 fast food chain in the U.S. — with total sales of $2.2 billion for its 821 restaurants across 10 states.

But, more important, Whataburger has the second highest sales per store, $2.7 million. That beats the average McDonald's, Taco Bell, Burger King, Wendy's, etc. — the whole bunch of national biggies. Only Chick-fil-A has higher sales per store, a printing press $4 million.

What a deal?

If Whataburger is so successful on a per-store basis, why did the owners sell? Two factors, one probably, one definitely. In Godfather terms, the investment company probably made them an offer they couldn't refuse. While Whataburger has phenomenal sales per unit, it was growing at a very slow rate — only 15 new restaurants in 2017. That same year, Chick-fil-A opened 140 new restaurants. Taco Bell opened 168 new units. Domino's expanded by 216 locations. Popeyes popped the lid on 147 places.

Continue reading on CultureMap to learn about how the rising price of beef could impact burger chains.

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Born with a comic book in one hand and a remote control in the other, Cory DLG is the talent of Conroe's very own Nerd Thug Radio and Sports. Check out the podcast replay of the FM radio show at www.nerdthugradio.com!

12. RICE

The struggle continues as Baylor comes to town the week after Texas left an impression of a boot print on the backside of Rice. I think this program is a long way off from winning games against Texas and Baylor but showing a little "want to" could go a long way with the alumni and the student section.

11. TEXAS STATE

I think I was wrong about Texas State not being the eleventh worst team in the state but honestly, maybe they are. This week at least will shake out the bottom of the list and show who is where as all the schools on this end of the list are playing similarly equal teams.

10. UTSA

How bad is UTSA? We'll know after this week. I think they can play a hard game against North Texas and honestly winning it isn't out of the question. This week will go a long way to determine the pecking order of the bottom of this list and if UTSA wants to move up, this is their chance.

9. UTEP

This week Nevada comes to town and UTEP gets to try and play away the memories of their Week 2 loss. How they perform this week will determine the integrity and quality of this team. Can they step up their game and respond to the adversity of a season slipping away?

8. NORTH TEXAS

Losing to SMU and then to Cal, the season is quickly slipping away from North Texas but here comes UTSA. This is a game that will determine the season for North Texas. Are they losers or are they going to fight for their season? This game will answer that question.

7.  TEXAS TECH

So much losing last week, it feels like almost the whole state of Texas lost. Texas Tech losing to Arizona did not help their season at all but there was no way to bump them down because everyone else lost too. Tech's off this week so the Red Raiders can reload and try again next week.

6. SMU

So yet again I correctly predicted SMU would win, and now they're looking strong. This week they have a chance to really elevate their season by traveling to now ranked #25 TCU. This is the hard one; rolling strong, good momentum but here's hoping momentum travels because this is a tough road game. I don't think SMU's winning ways continue but the upset would be huge for their year.

5. HOUSTON

So last week someone e-mailed me and asked why I had U of H over Baylor, considering Baylor was having a better year so far and I pointed out Houston's loss was to a Oklahoma and Baylor had been beating up cupcakes. Well the losing continued and now Baylor moved up while on a bye; Houston is down and it looks like even a win against Tulane won't change things.

4. BAYLOR

Coming off the bye, they passed U of H in the rankings because honestly U of H lost again. Baylor looks to continue its dominance of cupcakes this week against Rice and unless something changes this is probably where they'll be until they play Oklahoma later this season.

3. TCU

TCU won against Purdue and now they have SMU coming to town. These mid-level teams battling it out is the hardest thing to predict, because it's tough to gauge how far apart these teams are. I think TCU will win this game but even if they do, how much do we reward such a win? These are the things that makes college football fun.

2. TEXAS A&M

Texas A&M did exactly what I thought they would and beat Lamar. That probably helped the locker room feel better about their season but here comes Auburn and honestly, it's tough to see a way A&M wins this game. Obviously this will be the game to watch, but the odds of it going well are slim.

1. TEXAS

Texas took full advantage of Rice and took care of business. A big win after a loss is always what the doctor ordered but now Oklahoma State is coming to town and Texas needs to decide if they want to have a good season or a bad season. Stay Tuned.

Feel free to check out my brand new comic book Another Day at the Office or buy a shirt from Side Hustle Ts where some proceeds help people struggling with cancer or listen to Nerd Thug Radio. Thoughts, complaints, events and comments can be sent to corydlg@gmail.com.

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