Who owns Burger King?

Burger King is an American multinational chain of fast-food restaurants that is headquartered in Miami, Florida. The first Burger King restaurant, then known as Insta-Burger King, was opened in Jacksonville, Florida, in 1953 by Keith Cramer and his stepfather Matthew Burns. Burger King Worldwide merged with the Canadian coffee chain Tim Hortons in 2014. This precipitated the formation of parent company Restaurant Brands International, which is part-owned by former Burger King owner 3G Capital. 

Products and ServicesBurger King offers a diverse menu of fast-food items, including hamburgers, cheeseburgers, chicken sandwiches, salads, breakfast items, and a variety of sides like french fries and onion rings. The company also provides various beverages, including soft drinks, milkshakes, and coffee. Burger King often introduces limited-time offerings (LTOs) and promotional menu items to attract customers.Burger King’s core product offerings include classic fast-food items that cater to a broad customer base. The introduction of LTOs and promotional items adds variety and encourages repeat visits. The inclusion of breakfast items extends the brand’s reach into different dayparts.Hamburgers, cheeseburgers, chicken sandwiches, salads, breakfast items, sides (french fries, onion rings), beverages (soft drinks, milkshakes, coffee), limited-time offerings (LTOs), promotional menu items, diverse product offerings, catering to various customer preferences.
Revenue StreamsBurger King generates revenue primarily from the sale of its menu items in its restaurants. The company earns income from both dine-in and takeaway orders. Additionally, Burger King may offer drive-thru and delivery services, which contribute to sales and customer convenience. The company also utilizes value meals and combos to encourage upselling and larger orders.The primary revenue source for Burger King is the sale of menu items through dine-in, takeaway, drive-thru, and delivery services. The use of value meals and combos promotes higher average transaction values. Multiple revenue streams, including promotions and add-ons, contribute to overall financial stability.Revenue from menu item sales, dine-in, takeaway, drive-thru, delivery services, value meals, combos, promotions, add-ons, diversified revenue streams ensuring financial stability.
Customer SegmentsBurger King serves a diverse customer base, including individuals, families, students, young adults, and people from various demographic backgrounds. The company tailors its menu, pricing, and marketing efforts to address the needs and preferences of different customer segments. Burger King often targets price-conscious consumers with its value menu items.Customer segments for Burger King encompass a wide range of individuals and groups, each with unique preferences and budgets. Tailoring the menu, pricing, and marketing strategies to cater to diverse customer segments enhances market relevance and encourages repeat visits.Individuals, families, students, young adults, price-conscious consumers, diverse customer segments, tailored menu, pricing, marketing strategies, market relevance, repeat visits.
Distribution ChannelsBurger King’s products are distributed primarily through its network of restaurants, which includes company-owned locations and franchise outlets. The company also offers drive-thru, takeaway, and delivery services to provide customers with various ordering options. Online and mobile ordering platforms further enhance accessibility and convenience.Distribution channels for Burger King primarily consist of its restaurant network, ensuring a physical presence for customer orders. Drive-thru, takeaway, and delivery services offer flexibility and convenience. Online and mobile ordering platforms extend accessibility, catering to tech-savvy consumers.Restaurants, company-owned locations, franchise outlets, drive-thru, takeaway, delivery services, online and mobile ordering platforms, physical presence, flexibility, convenience, accessibility.
Key PartnershipsBurger King collaborates with various partners to enhance its offerings and expand its market presence. The company often forms partnerships with food suppliers to ensure a consistent supply of quality ingredients. Additionally, Burger King may collaborate with entertainment companies or sports organizations for co-branded promotions and marketing campaigns.Partnerships with food suppliers are crucial for maintaining the quality and consistency of menu items. Collaborations with entertainment or sports entities provide promotional opportunities and enhance brand visibility. These partnerships contribute to customer engagement and growth.Partnerships with food suppliers, consistent supply of quality ingredients, collaborations with entertainment and sports entities, co-branded promotions, brand visibility, customer engagement, growth.
Key ResourcesKey resources for Burger King include its network of restaurants, a diverse menu of fast-food items, brand recognition, a dedicated workforce, including kitchen staff and customer service representatives, reliable suppliers for ingredients, store locations, and financial resources for investments and expansion.Resources for Burger King encompass a network of restaurants supporting customer orders, a diverse menu, brand recognition, a dedicated workforce, reliable suppliers for ingredients, store locations, financial resources, supporting the company’s position as a leading fast-food chain.Restaurants, diverse menu, brand recognition, dedicated workforce, suppliers, store locations, financial resources, resources supporting a leading fast-food chain.
Cost StructureBurger King incurs various costs associated with its operations, including expenses for ingredients and food supplies, employee salaries and benefits, marketing and advertising expenditures to promote its brand and products, rent and lease agreements for restaurant locations, store maintenance and utilities, research and development investments for new menu items and promotions, and administrative overhead. Procurement of quality ingredients is a significant operational cost.Costs associated with Burger King’s operations include ingredient and food supply costs, employee salaries and benefits, marketing and advertising expenses for brand and product promotion, rent and lease agreements for restaurant locations, store maintenance and utilities, research and development investments, administrative overhead. Procurement of quality ingredients represents a substantial operational cost to ensure food quality and taste.Ingredient and food supply costs, employee salaries and benefits, marketing and advertising expenses, rent and lease agreements, store maintenance, utilities, research and development investments, administrative overhead, significant ingredient procurement costs for food quality.
Competitive AdvantageBurger King’s competitive advantage lies in its established brand recognition, a diverse menu offering a wide range of fast-food items, and a focus on value pricing and promotions. Partnerships with suppliers ensure ingredient quality. The company’s global presence and innovation in menu items contribute to its competitiveness in the fast-food industry.Strong brand recognition, diverse menu, value pricing, and promotions cater to price-conscious consumers. Partnerships with suppliers ensure ingredient quality. Global presence and menu innovation reinforce Burger King’s competitive position in the fast-food industry.Established brand recognition, diverse menu, value pricing, promotions, price-conscious consumers, partnerships with suppliers, ingredient quality, global presence, menu innovation, competitive position in the fast-food industry.

Early inspiration

Cramer and Burns were inspired to open a store after visiting the first McDonald’s restaurant in San Bernadino, California.

In keeping with the idea of fast food, the pair purchased a cooking device known as the Insta-Broiler which became so successful that all future franchises were built around it.

By 1959, however, the company or its business model was less attractive and it was purchased by James McLamore and David R. Edgerton.

The pair, who were franchisees themselves, restructured the company and renamed it Burger King. It was also around this time that the signature Whopper burger was developed.

Over the next eight years, the pair expanded to over 250 locations across the United States.

Pillsbury Company acquisition

The Pillsbury Company acquired Burger King in 1967 for $18 million. With the necessary capital behind it, Burger King was able to grow into the second-largest chain in America behind McDonald’s.

In 1978, Burger King even went as far as poaching McDonald’s executive Donald N. Smith.

Smith’s most notable initiative was to restructure the company’s franchise system to prevent franchisees from owning stores in other chains.

Franchisees were also prevented from owning stores that were more than an hour’s drive from their homes.

This move encouraged loyalty, decreased absentee ownership, and enabled the company to streamline operations. 

McDonald’s rivalry

Norman Brinker, who had also been recruited externally, instituted what would become known as the Burger Wars.

The company started to run commercials promoting Burger King burgers as bigger and better than those from McDonald’s.

Burger King also introduced children’s characters such as the Wizard of Fries and Sir Shake-a-Lot to counter the growing influence of Ronald McDonald. 

When Burger King was taken over once more in 1989, the company shifted its soft drink allegiance from Pepsi to Coca-Cola and partnered with Disney to collaborate on film and character-based toys and other products.

The company’s headquarters was destroyed by Hurricane Andrew in 1992, but a proactive response saw a quick reversal in Burger King’s fortunes.

Who owns Burger King today?

Burger King has been bought and sold several times over its history. After the Pillsbury Company acquisition, that company was acquired in 1989 by British conglomerate Grand Metropolitan.

When Grand Metropolitan merged with Guinness PLC in 1997, it became known as Diageo PLC. Some questioned this particular acquisition because Diageo had mostly alcoholic brands under its umbrella and paid relatively little attention to its fast-food asset.

Five years later, in 2002, Diageo sold Burger King to a private equity financier consortium that included Bain Capital, Texas Pacific Group, and Goldman Sachs.

On September 1, 2010, investment firm 3G Capital purchased the company for $3.26 billion.

Burger King Worldwide then merged with the Canadian coffee chain Tim Hortons in 2014 which precipitated the formation of parent company Restaurant Brands International.

However, as recently as late 2019, 3G Capital retained a 32% interest in the parent company and thus could be considered part owners of Burger King.

Key takeaways

  • Burger King is an American multinational chain of fast-food restaurants that is headquartered in Miami, Florida. The first Burger King restaurant, known as Insta-Burger King, was opened in Jacksonville, Florida, in 1953.
  • By 1959, the company or its business model was less attractive and it was purchased by James McLamore and David R. Edgerton. This started a series of acquisitions starting with the Pillsbury Company in 1967.
  • Burger King Worldwide then merged with the Canadian coffee chain Tim Hortons in 2014. This precipitated the formation of parent company Restaurant Brands International, which is part-owned by former Burger King owner 3G Capital. 

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McDonald’s is a heavy-franchised business model. In 2021, over 56% of the total revenues came from franchised restaurants. The company’s long-term goal is to transition toward 95% of franchised restaurants (in 2020, franchised restaurants were 93% of the total). The company generated over $23 billion in revenues in 2021, $9.78 billion from owned restaurants and $13 billion from franchised restaurants. 

McDonald‘s Organizational Structure

McDonald’s has a divisional organizational structure where each division – based on geographical location – is assigned operational responsibilities and strategic objectives. The main geographical divisions are the US, internationally operated markets, and international developmental licensed markets. And on the other hand, the hierarchical leadership structure is organized around regional and functional divisions.

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Franchising Business Model

Franchising is a business model where the owner (franchisor) of a product, service, or method utilizes the distribution services of an affiliated dealer (franchisee). Usually, the franchisee pays a royalty to the franchisor to be using the brand, process, and product. And the franchisor instead supports the franchisee in starting up the activity and providing a set of services as part of the franchising agreement. Franchising models can be heavy-franchised, heavy-chained, or hybrid (franchained).

Coca-Cola Business Model

Coca-Cola follows a business strategy (implemented since 2006) where through its operating arm – the Bottling Investment Group – it invests initially in bottling partners operations. As they take off, Coca-Cola divests its equity stakes, and it establishes a franchising model, as long-term growth and distribution strategy.

Coca-Cola Mission Statement

Coca-Cola’s Purpose is to “refresh the world. make a difference.” Its vision and mission are to “craft the brands and choice of drinks that people love, to refresh them in body & spirit. And done in ways that create a more sustainable business and better-shared future that makes a difference in people’s lives, communities, and our planet.”

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