Wingstop CEO on Thighstop: We’re looking to sell the whole bird eventually

Wingstop CEO Charlie Morrison joins Yahoo Finance Live to discuss the launch of the hot new brand Thighstop, that sells juicy chicken thighs.

Video transcript

BRIAN SOZZI: Wingstop has cooked up a clever way to keep sales sizzling and triumph over intense chicken wing inflation to launch a new brand. The wing chain has launched Thighstop, a digital-only brand that-- you guessed it, folks-- just sells juicy, saucy thighs. Joining us for more on this is Wingstop CEO Charlie Morrison.

Charlie, we last talked in November. You came on here, and we joked a little bit about possibly you creating a brand called Thighstop. You were testing thighs at the time. We both laughed. I moved on to the next question. But now here you are with a brand online called Thighstop. Why did you launch it?

CHARLIE MORRISON: Well, at the time, I couldn't let the cat out of the bag. But we've been testing thighs as a center-of-the-plate item for quite some time. And quite frankly, we think thighs are the most underappreciated part of the chicken. They're left at the bottom of the bucket. That's just not fair.

So we have been perfecting this idea for a little bit of time now. You've seen virtual brands pop up during the pandemic. They've made a big splash. And this is our way of launching a great new product in a unique way. And it's going great so far.

BRIAN SOZZI: You're right, it's not fair. And to your point, I have never tried boneless thighs, so I will have to give these a try at some point this week. So my question is, what is more profitable for Wingstop, is it selling thighs or your traditional wings?

CHARLIE MORRISON: Well, I think it's a combination of all of the above, Brian. We've pioneered wings as a center-of-the-plate item for 27 years in our history. We added boneless wings. We also sell tenders. What we're looking for is the opportunity to sell all the parts of the chicken and give each one of them their rightful place in the center of the plate, sauced and tossed with our 11 bold and distinctive flavors.

We think this is going to be a fan favorite. And quite frankly, this is a big opportunity for us to expand our supply chain leverage by making sure that we're buying all the parts of the chicken, which we think will be an even more profitable venture for our franchisees in the long term.

MYLES UDLAND: Well, I'm curious then what has taken so long for the thigh to get its due? We've been chatting about this all morning and chatting about it in the context of when we go to the grocery store, thighs are not only less expensive, they also are harder to screw up, and they, in general, taste a lot better than if you go and get chicken breasts.

Now I know maybe there's higher fat content, they're not quite as healthy. But just as a general idea within the chicken industry, it seems that thighs are now taking a more prominent role, not just at your brand, but at others. What's taken so long for us to get here?

CHARLIE MORRISON: Well, I think it's a couple factors. Number one, we've exported thighs for so many years, just like we did chicken wings, and that's how we founded the whole chain around that. This product and the leg quarter itself is very similar in that there's just not a lot of demand for it.

We've trained consumers for so long that the breast meat is really the part of the chicken wing-- or chicken we should focus on, wings second, and then the leg quarter's kind of left out there for unique opportunities. We believe it deserves that rightful center-of-the-plate presence. And it has taken a while.

I think the other piece is the commodity markets right now. There's so much demand for chicken. There's a shortage in labor, which is causing supply challenges for a lot of players. And this product now has found its rightful place. It's affordable. It is a better product. It's juicy, tender, easy to cook and execute. We think it's going to be a big hit.

JULIE HYMAN: Charlie, I've been on the thigh train for years. I don't know where everybody else has been. But I want to-- you touched on labor, and in particular the labor difficulties that the chicken processors have been having. Does the thigh supply, though, is that-- I mean, presumably that's also affected by the shortages, right? Does this change the equation at all in terms of you guys getting that supply?

CHARLIE MORRISON: Well, yes and no. The thigh product is in good supply. Wings are in great supply. We're getting all the wings we need right now to fuel our business. We've seen others shorted in the market with product. But being one of the biggest, if not the biggest, player in the space and an everyday player, our wing supply is in good shape.

The opportunity here for us is to unlock the whole bird, meaning we can now start to grow out whole birds and chickens so that we can contract more of our supply rather than buying it on the spot market. And so there's a lot of demand for breast meat, certainly a lot of demand for chicken wings. The leg quarter, not so much. This is our opportunity to really optimize our supply chain, buy the whole bird, and set us up for future success.

BRIAN SOZZI: Charlie, this really now puts you going head-to-head with KFC in terms of the whole bird. Are you nervous about going up against the Colonel?

CHARLIE MORRISON: Not at all. Not at all. Our brand is so unique. We don't just fry up a bucket of chicken. We actually sauce and toss all our chicken with our 11 bold and distinct flavors. We think that is really the differentiator for this brand.

We've centered it on chicken wings. We believe we have this opportunity now to expand the product line, leverage more of the chicken. But we're still going to give each product its own feature. We won't sell it in a bucket like some of the rest do.

BRIAN SOZZI: All right, fair enough. Before we let you go, we are seeing some reports, just overall in the fast food industry, that the industry has now started to pull back on promotions because of the inflation they are seeing. Have you had to pull back?

CHARLIE MORRISON: No. I think this is a great example. We launched this product yesterday. We're going to continue to push and grow the business. We've seen inflation, certainly. We've seen some challenges with labor.

But our model is so unique, it doesn't take many people to staff and execute the Wingstop, even at high volume. Our dining rooms are still, for the most part, closed across the country, but we're able to sustain good growth without it. And so our promotional engine is up and running and moving at full speed right now.

BRIAN SOZZI: And just to confirm, you're still Wingstop CEO. You're not Thighstop CEO, right? Just want to clear any confusion.

CHARLIE MORRISON: Well, some have said both, I'm the CEO of both companies. At some point down the road, we'll have to figure out how to pull these two things together.

BRIAN SOZZI: All right, fair enough. We'll leave it there. Wingstop CEO Charlie Morrison. Good luck on the new venture. We'll talk to you soon.

CHARLIE MORRISON: Thanks, Brian.