Wahlburgers is a casual dining burger restaurant chain founded by brothers Mark, Donnie and Paul Wahlberg in 2011. The first Wahlburgers opened in Hingham, Massachusetts and now has expanded to over 50 locations across the United States and Canada. While Wahlburgers offers high-quality burgers made with premium ingredients, the prices are considerably higher than other burger chains like McDonald’s or Burger King. A basic hamburger at Wahlburgers starts at around $9 while some specialty burgers can cost up to $15 or more. This begs the question – why exactly are the Wahlburgers so expensive compared to other fast food burgers?
Higher Quality Ingredients
One of the main reasons Wahlburgers burgers cost more is that they use higher quality ingredients. Their burgers are made from fresh, never frozen beef sourced from reputable suppliers. The beef patties are hand-formed and cooked to order on a flat top grill. The buns are artisan rolls delivered fresh daily from local bakeries. The toppings and produce are also high-end – you’ll find things like aged cheddar, applewood smoked bacon, avocado and caramelized onions instead of basic American cheese, bacon bits and raw onion slices. The focus is on premium, fresh ingredients rather than mass-produced, frozen components. This naturally drives the costs up compared to fast food chains using lower quality, mass-produced ingredients to keep prices down.
Customizable Burgers
Wahlburgers offers a wide array of customizable burger options compared to typical fast food chains. While McDonald’s or Burger King may have only a couple burger varieties, Wahlburgers has around 10 different basic burgers that can each be customized with various premium toppings and substitutions. This requires having a lot more ingredients and preparation options available, which adds to the costs. Some of the customizable topping options include avocado, fried egg, chili, grilled pineapple, lettuce wraps and more. The large variety of burger customizations allows customers to get creative but also requires more diverse, fresher ingredients that drive up costs.
Made to Order Cooking
Unlike typical fast food chains where burgers are often pre-made and sitting under heat lamps, Wahlburgers burgers are always made fresh to order. Each burger starts as a raw patty that is placed on the flat top grill after the customer orders. This ensures maximum freshness and quality but reduces efficiency compared to pre-made options. The cooks also take time to prepare each burger carefully based on the customer’s specifications. The made-to-order cooking process allows excellent customization but requires more labor and time that adds to the overall costs.
Upscale Restaurant Ambiance
Wahlburgers locations have a casual but upscale restaurant layout and ambiance that is very different from a typical fast food joint. The restaurants have a full bar serving signature adult beverages and cocktails. The dining area has real silverware, glasses and plates instead of plastic trays and cutlery. There are tablecloths and often times live music or entertainment. The overall vibe is trendy and inviting compared to sterile fast food environments. This unique ambiance and dining experience comes at a real estate and operational cost that gets incorporated into the menu prices.
Higher Labor Costs
The costs associated with staffing and labor tend to be higher for Wahlburgers compared to fast food due to differences in wages and staffing models. Fast food chains rely heavily on part-time minimum wage employees with high turnover rates. Wahlburgers locations tend to have more full-time employees that likely earn above minimum wage. There are bartenders mixing drinks, hosts seating guests and busboys cleaning tables. The employees tend to be better trained and qualified in customer service. The increased labor costs associated with higher wages and more staff contributes to the higher prices.
Franchise Model Costs
As a franchised restaurant chain, individual Wahlburgers locations pay various franchise fees and royalties back to the corporate parent. Franchisees have to cover the buildout and opening costs for new locations which can run from $500,000 to over $1 million. Ongoing royalties of 4% to 5% of sales revenue also get sent back to corporate. These franchise costs inevitably influence pricing decisions to maintain profit margins. Independent restaurants don’t incur these franchise costs allowing more flexibility on pricing.
UNIQUE FACTORS FOR WAHLBURGERS PRICING
Beyond the major factors above, there are some unique reasons why Wahlburgers specifically commands a pricing premium compared to other better burger chains like Five Guys or Shake Shack.
Celebrity Ownership
The famous Wahlberg brothers of Mark, Donnie and Paul generate immense brand awareness and draw for Wahlburgers. Their celebrity ownership and involvement enables marketing and publicity opportunities other chains don’t have. The brand trades heavily on their likeness and star power. Customers often come for the novelty of the experience which allows Wahlburgers to price at a premium.
Prime Real Estate Locations
Wahlburgers has strategically located restaurants in premium real estate spots with high foot traffic, tourism and affluent demographics. Prime locations include popular destinations like the Las Vegas Strip, Walt Disney World and Times Square. Positioning in hot spots with strong tourism and hospitality markets enables Wahlburgers to command higher prices compared to suburban strip mall locations other chains may operate out of.
Alcohol Sales
Wahlburgers has a full-service bar program featuring signature drinks and local beers on tap. Alcohol sales at much higher price points than food help boost revenues and offset the costs of higher quality food. Most fast food chains don’t offer alcohol so this gives Wahlburgers another advantage for pricing flexibility.
Brand Cachet
The Wahlberg brand and image resonates with customers who see it as an aspirational lifestyle brand. The prices communicate a sense of premium quality and exclusivity that increases perceived value. The customer experience feels elevated and indulgent compared to typical fast food. Wahlburgers is able to charge a pricing premium based on brand image and cachet.
Price Comparison to Other Better Burger Chains
| Restaurant | Basic Burger Price |
|---|---|
| McDonald’s | $3-$5 |
| Burger King | $3-$5 |
| Wendy’s | $5-$7 |
| Five Guys | $7-$9 |
| Shake Shack | $5-$8 |
| Wahlburgers | $9-$11 |
This table compares the price of a basic hamburger from major fast food chains and better burger restaurants. It shows Wahlburgers on the higher end around $9-$11 for a plain hamburger. The premium fast casual better burger segments ranges from around $7-$9 per burger. While the mass market fast food players are closer to $3-$5 per basic burger. So Wahlburgers prices represent around a 100% premium over everyday fast food chains for a basic product.
Conclusions
Wahlburgers commands a significant price premium over typical fast food chains for several compelling reasons. The use of higher-quality ingredients, greater product customization, made to order preparation, upscale ambiance and increased labor costs all contribute to higher prices. Unique factors like celebrity ownership, prime locations, alcohol sales and aspirational branding further enable Wahlburgers to price at a level to match the elevated dining experience. While the burgers are expensive relative to McDonald’s and Burger King, the prices reflect the premium quality and unique dining experience customers receive. Wahlburgers has found success at current price points by delivering a highly customized, chef-driven burger option in an inviting full-service restaurant environment.
