Wingstop is seeing ‘significant deflation’ in hen wings, CEO says

Rooster wings costs have come down in worth since hovering final yr, Wingstop chief government Michael Skipworth advised CNBC’s Jim Cramer on Wednesday.

“Different manufacturers are … going to have to take a look at pricing so as to handle their margins, and Wingstop is in a really totally different place in that we have seen significant deflation in our enterprise. The value of wings final yr .. hit $3.22 a pound, and we quick ahead to at the moment, and it is $1.63 a pound,” Skipworth stated in an interview on “Mad Cash.”

“We have seen this in years earlier than the place plenty of companies soar into wings [and] it drives the demand up. However as we sit right here at the moment, their companies weren’t constructed to handle that volatility within the commodity, and so we have been capable of climate that like now we have previously, they usually’ve moved away ,” he added.

Skyrocketing costs of components and provide have put stress on eating places’ operations in the course of the pandemic, forcing many to lift menu costs to offset the upper prices.

Skipworth, who turned CEO of Wingstop in March, additionally credited excessive demand for hen breasts as serving to tamp down wing prices.

“There’s plenty of demand for breast meat, and breast meat is the place these poultry firms make their revenue, and they also’re rising as many birds as they’ll proper now, which implies plenty of provide for wings on the market,” he stated.

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