Burger chain’s $11.9m discount ‘mistake’
The biggest Burger King franchisee in the world has admitted it "screwed up" a meal deal, losing millions in the process.
Carrols Restaurant Group, which owns and operates more than 1000 Burger Kings - the equivalent of Australia's Hungry Jack's - in 23 US states, has revealed it accidentally gave customers a double discount.
The mistake occurred during the second and third quarters of 2019, when New York-based company offered two Whopper Jr sandwiches for $US4 ($A5.83), two Whoppers for $US5 ($A7.29) and two Double Whoppers for $US6 ($A8.75).
Diners should have been charged the normal price for drinks and chips purchased with the discounted Whopper burgers, but were incorrectly charged lower "value meal" rates, according to CEO Dan Accordino.
The Syracuse Post-Standard reports the company's mistake meant customers scored two discounts, which ultimately cost it $US1.50 ($A2.19) on each sale.
"It was not an accounting issue, it was not a systems issue. It was a mistake," he said late last week, according to the publication.
"We screwed up and it cost us a fair amount of money."
That mistake saw revenue plummet by around $US12.4 million ($A18 million) in the first nine months of 2019 - bringing the net loss to $US8.2 million ($A11.9 million).
Mr Accordino said Carrols Restaurant Group learnt of the mistake in August after discovering its sales increases were well behind that of other franchisees, despite usually leading different franchisees.
He said recent sales increases across the wider Burger King chain were partly due to the introduction of the new, plant-based Impossible Whopper or "Rebel Whopper" which also launched in Australia last month to much fanfare.
According to the company's website, the new meat-free burger "features a patty made from plants, flame-grilled to give the irresistible smoky, BBQ flavour just like our classic Whopper".
After Carrols Restaurant Group's error was fixed and prices hiked up, revenue picked up again, rising by 7.9 per cent in September.
"We screwed up, but the fact of the matter is, the underlying business is stronger than what our numbers reflect," interim Chief Financial Officer Timothy LaLonde said during a conference call, the Syracuse Post-Standard reported.
In addition to running around 1032 Burger King restaurants, Carrols Restaurant Group also runs 61 Popeyes eateries in the US.
It employs tens of thousands of people across the US and has operated Burger Kings since 1976 in locations across 23 American states.