The lead up to the Super Bowl every year inevitably turns to chicken wing demand. Super Bowl LIV, which was played pre-pandemic on February 2, saw Americans consume an estimated 1.4 billion chicken wings. That was a new record high and 20 million more than the previous year. That amount of chicken wings is enough to put 640 wings on every seat in all 31 NFL stadiums, according to the National Chicken Council. The price of chicken wings also increases approximately +7 percent from early January to the Super Bowl, according to Jayson Lusk, who heads the Department of Agricultural Economics at Purdue University. Prices then tend to fall -4% to -5% in to mid- to late February.
Of course, the pandemic hit just as March Madness rolled around, one of the busiest times for sports bars and in particular, chicken wing concepts. That first shutdown, if you recall, brought business across the country to a near halt. Chicken wing restaurants were hit hard at first but as luck would have it, wings are a very delivery-friendly menu item. According to Grubhub, chicken wings were +287% more popular in 2020 than in 2019. And they were the third most popular delivery order amid the pandemic.
Dallas-based chicken wing chain Wingstop saw sales climb almost +33% in the third quarter. Wings as a side also surged and many restaurants moved fast to capitalize on the trend. Domino’s went so far as to “redesign” their wings, introducing the new and improved version in July. Others are launching their own wing concepts. Brinker International debuted It’s Just Wings in June, a delivery-only concept it runs out of 1,000 Chili’s and Maggiano’s locations. Casual-dining chain Applebee’s is testing Neighborhood Wings in 700 of its units, with the intention to roll out the virtual concept systemwide early in 2021. Hooter’s recently announced plans to launch a fast-casual concept called Hoots Wings with 17 new locations planned for 2021 and another 35 for 2022.
There are some that warn against diving into the chicken wing restaurant biz, however. Jonathan Maze, Editor-in-Chief of Restaurant Business, says that chicken wings, far more than any other commodity, are highly volatile. He recalls a chicken wing price surge in 2017 that forced Buffalo Wild Wings to end a popular Wing Tuesday promotion. Sales subsequently plunged which launched a shareholder revolt and a lot of other ugly business. They were bought out by Roark Capital later that year. There was also an incident in 2011 when McDonald’s launched “Mighty Wings.” This led to stockpiling with suppliers worried they wouldn’t be able to meet a surge in demand, which sent prices soaring. That was followed by steep price declines when “Mighty Wings” flopped and those chicken wings then flooded the market.
The thing with chicken wing supplies is that they can not be adjusted to meet wing demand. The wing supply is completely dependent on chicken supplies and it makes no sense for producers to ramp up total chicken production for just two wings. This is the reason for seasonal price surges that happen like clockwork. Sanderson Farms said jumbo wing prices were up about +9% in the third quarter. However, average prices were down -6.6% during its fiscal year which ended October 31. It will be interesting to see how all this new activity impacts the market! (Sources: Restaurant Business, JaysonLusk, Texas A&M)