Buffalo Wild Wings is a popular American casual dining restaurant chain that specializes in buffalo wings, other comfort foods, and a variety of beverages, especially beer. Over the years, Buffalo Wild Wings has become one of the most recognizable names in the casual dining industry, with a reputation for its lively sports bar atmosphere and extensive menu of wings and appetizers. But how much revenue does this well-known brand generate, and what factors contribute to its financial success? This article provides an in-depth look at Buffalo Wild Wings’ revenue, exploring its performance over recent years, its revenue streams, and how it has managed to maintain a profitable business.
The Background of Buffalo Wild Wings
Buffalo Wild Wings was founded in 1982 by Jim Disbrow and Scott Lowery in Columbus, Ohio. Initially, the restaurant was created with the aim of providing a fun and casual dining experience, centered around Buffalo-style wings. The business rapidly grew and expanded across the United States. By 2017, Buffalo Wild Wings had more than 1,200 locations across the country and a strong international presence as well.
In 2017, Buffalo Wild Wings was acquired by Inspire Brands, the same company that owns other popular restaurant chains such as Arby’s, Sonic Drive-In, and Jimmy John’s. This acquisition provided Buffalo Wild Wings with additional resources, marketing expertise, and growth potential. Despite the change in ownership, the company’s core offering—wings, beer, and sports—remained unchanged.
Revenue Streams of Buffalo Wild Wings
Buffalo Wild Wings generates revenue through several key streams, including:
1. In-Restaurant Sales
The bulk of Buffalo Wild Wings’ revenue comes from in-restaurant sales. The company operates primarily on a dine-in model, where customers visit its restaurants to enjoy a meal. These sales are made up of:
Buffalo Wings: Buffalo Wild Wings is renowned for its wide variety of buffalo wings. Customers can choose from a range of sauces and spice levels, making wings the restaurant’s core product.
Appetizers: In addition to wings, Buffalo Wild Wings serves a variety of appetizers like mozzarella sticks, onion rings, and loaded fries, which are popular among diners.
Beverages: Beer, especially draft beer, is a major part of the company’s beverage menu. Given its sports bar atmosphere, Buffalo Wild Wings is also known for its extensive drink menu, which includes cocktails, soft drinks, and more.
Other Menu Items: Buffalo Wild Wings also offers burgers, sandwiches, salads, and wraps, catering to a broad range of tastes beyond just wings.
2. Franchise Revenue
Buffalo Wild Wings operates on a franchise model, with many of its locations being independently owned and operated by franchisees.
Franchisees pay an initial franchise fee to open a restaurant, as well as ongoing royalty fees and advertising contributions.
These fees contribute significantly to the company’s overall revenue.
Franchise Fees: Franchisees typically pay an initial fee of $25,000 to $40,000 to open a Buffalo Wild Wings location.
Ongoing Royalties: Franchisees also pay a royalty fee that is usually around 5% of their restaurant’s gross sales. This fee helps support the operational and marketing efforts of the company.
Buffalo Wild Wings has managed to maintain a strong franchise model, allowing it to expand rapidly while minimizing the financial risks associated with owning and operating individual locations.
3. Digital Sales and Delivery
In recent years, Buffalo Wild Wings has invested heavily in its digital sales channels. The company has built a strong online ordering platform that allows customers to place orders for pickup or delivery.
Buffalo Wild Wings has partnered with third-party delivery services like DoorDash, Grubhub, and Uber Eats to reach customers who prefer to enjoy their meals at home.
This shift toward digital ordering and delivery has been particularly beneficial for the company, especially during the COVID-19 pandemic, which forced many restaurants to pivot to take-out and delivery models. Even as the pandemic eased, Buffalo Wild Wings continued to benefit from its digital sales channels, and this revenue stream is expected to grow in the coming years.
4. Alcohol Sales
Buffalo Wild Wings’ emphasis on a fun, sports-centered atmosphere makes alcohol sales a significant part of its revenue.
The restaurant chain offers a wide selection of draft beers, bottled beers, wine, and cocktails. Alcohol not only boosts the company’s overall revenue but also contributes to higher profit margins compared to food sales.
The popularity of Buffalo Wild Wings as a venue for watching sports events also plays a role in the success of its alcohol sales. Major sporting events, such as the Super Bowl, NBA Finals, and March Madness, bring in large crowds eager to enjoy food and drinks while watching the games on big-screen televisions.
Buffalo Wild Wings Revenue by the Numbers
To understand the company’s revenue in more detail, it’s important to examine its financial performance over the years.
Since Buffalo Wild Wings is a part of Inspire Brands, its detailed financials are no longer published separately, but we can look at some available figures from previous years and reports.
Revenue Growth Under Inspire Brands
Inspire Brands acquired Buffalo Wild Wings for $2.4 billion in 2017. Since then, the brand has continued to grow in terms of revenue, aided by the resources and synergies provided by its parent company. In 2020, Buffalo Wild Wings generated approximately $4 billion in revenue, despite the challenges of the COVID-19 pandemic.
The revenue drop in 2020 was primarily due to the closure of dining rooms and restrictions on restaurant operations.
However, the company rebounded quickly thanks to the strong demand for delivery and takeout services. By 2021, the brand was back on track to achieve strong revenue figures, with digital and delivery sales playing a key role in that recovery.
Average Unit Volumes (AUV)
One of the most significant metrics used to assess the performance of restaurant chains like Buffalo Wild Wings is Average Unit Volume (AUV). This figure represents the average revenue per restaurant location over a certain period, usually annually.
In 2021, Buffalo Wild Wings reported an AUV of approximately $3.6 million per location. This is a strong performance, particularly considering the challenges that the restaurant industry faced in recent years. The AUV can vary depending on the location, with some high-performing restaurants in urban areas generating even higher revenues.
Franchise Impact on Revenue
Franchise operations contribute a significant portion to the company’s revenue. Buffalo Wild Wings has continued to expand its franchise network, with franchisees accounting for the majority of its locations. While exact franchise revenue breakdowns are not typically disclosed, it is estimated that franchisees pay around 5% in royalties from gross sales, contributing millions of dollars to Buffalo Wild Wings’ overall revenue.
In addition to royalties, franchisees also contribute to marketing expenses, which can amount to 2-3% of their sales. These contributions help to fund national and local advertising efforts that promote the Buffalo Wild Wings brand.
The Impact of the Pandemic
The COVID-19 pandemic had a major impact on the restaurant industry as a whole, and Buffalo Wild Wings was no exception. In 2020, the company faced temporary closures of dining rooms and restrictions on operations, which resulted in a revenue decline in that year. However, Buffalo Wild Wings quickly adapted by increasing its focus on digital sales, takeout, and delivery services.
By the end of 2020, the company was on track to recover and had successfully diversified its revenue streams. The shift towards off-premise dining proved beneficial in the long run, and Buffalo Wild Wings has continued to see strong demand for its services post-pandemic.
Conclusion
Buffalo Wild Wings has proven itself to be a strong player in the casual dining industry, generating impressive revenue from its in-restaurant sales, franchise fees, digital sales, and alcohol sales. While the brand faced some challenges during the COVID-19 pandemic, its ability to adapt to changing consumer habits allowed it to recover quickly and maintain a solid financial performance.
The revenue of Buffalo Wild Wings is a testament to its successful business model, which leverages a popular and recognizable brand, a strong franchise network, and a diverse range of products and services. As the company continues to expand and innovate, it will likely remain one of the top casual dining chains in the United States and beyond.
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