Feb 28, 2024 - Business

Wendy's says it will not use "surge pricing"

Illustration of a question mark made out of ketchup surrounded by french fries

Illustration: Sarah Grillo/Axios

Wendy's said Wednesday it will not raise prices when demand is at its highest in response to consumer backlash about the company's plans to test "dynamic pricing," commonly referred to as surge pricing.

Why it matters: A flurry of news articles about the fast-food chain planning to test a new pricing strategy as early as 2025 caused a public relations nightmare for the company.

  • Some news articles compared Wendy's plans to ride-sharing services such as Uber which commonly use surge pricing at peak times when demand is highest.

The latest: Wendy's blamed the flare-up in a statement on "some media reports" misconstruing its plans to use dynamic pricing "as an intent to raise prices when demand is highest at our restaurants."

  • "To clarify, Wendy's will not implement surge pricing," a company spokesperson told NBC News.
  • "We didn't use that phrase, nor do we plan to implement that practice," the spokesperson added.

Context: Wendy's CEO Kirk Tanner talked about the Ohio-based chain's pricing plans on Feb. 15 during the company's earnings call.

  • Tanner also said the company was investing $20 million in new digital menu boards to give restaurants more flexibility to feature items and provide discounts.

Yes, but: Wendy's did not attempt to clarify its position to Axios on Tuesday when a reporter reached out for comments on its "surge pricing" plans.

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