Burger King Sold! What's Next?

Burger King agreed on Wednesday to a $4 billion buyout by private equity firm 3G Capital, leading to the question on every American’s mind: Will the King get a makeover?

Burger King stock has sagged since returning to public markets in 2006. A joint press release by Burger King and 3G made no mention of the company’s struggles or what’s in store for its Whoppers and fries.

Still, consumers should take note of some of the changes in the works at Wendy’s, which was bought out in 2008 by Triarc, the parent company of Arby’s. In the wake of the buyout, the chain has attempted to distance and distinguish itself from the rest of the fast food pack with menu offerings like gourmet salads, as well as a recent pilot program testing new, “natural” fries. Its advertising has likewise evoked this new strategy, including an emphasis on “fresh, never-frozen beef” and their latest slogan, “You know when it’s real.”

While similar moves could be in the future for Burger King, don’t expect the chain to stray too far from its namesake – burgers are still king, both at BK and in the restaurant industry as a whole.

“The number one food that consumers eat is still the burger,” notes Harry Balzer, chief industry analyst at the NPD Group who tracks the restaurant industry. “The question is, where will that burger be bought?”

In recent years, the answer to that question has been Burger King less and less. And it’s not just McDonald’s that’s stealing away customers. The high-end burgers offered by the “fast casual” Five Guys has made the chain the fastest-growing in the industry, and that’s chipped away at Burger King’s reputation as a destination for higher-quality burgers. If Burger King wants to stand out with quality, it’s facing an increasingly crowded marketplace.

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