DENVER--(BUSINESS WIRE)--March Madness has again gripped the nation, along with madness for chicken wings, as sports bars and sports-themed restaurants serve platefuls of poultry to hungry customers as they gather to watch the basketball games on TV.
But restaurant operators are paying higher prices this year for bone-in wings, 63 percent more than in 2014, to keep the fans satisfied, said DeWayne Dove, vice president of risk management for SpenDifference, a rapidly growing restaurant supply chain co-op. In a year-over-year comparison, the cost of bone-in chicken wings is $1.91 a pound this year, compared with $1.17 in 2014. The lower cost last year was due in part to an increase in supply that held down the price, Dove said.
Although other meat commodity purchases rise slightly this time of year, restaurants that cater to the tournament crowd buy far more bone-in chicken wings than ground beef, he said. March Madness has the greatest affect on the cost of bone-in wings. Even with the higher prices for wings, restaurants have options to increase their profit margins:
- Expand the menu with lower-cost boneless wings, which are made from chicken breasts. The current wholesale price of chicken breasts is $1.63 a pound, a substantial savings over the bone-in product. “Operators who buy more boneless products and less bone-in wings can grow the category and increase their margins,” Dove said.
- Plan ahead and buy frozen wings to lock in prices. Frozen wings can be stored far longer than the fresh product, and operators who buy fresh wings “are at the mercy of the market,” he said.
Cost-saving measures are critical this time of year for some restaurants and sports bars.
“This is make-or-break time for restaurants that emphasize chicken wings on their menus,” Dove said.
Based in Denver, SpenDifference, LLC, partners with emerging to mid-sized restaurant companies, providing full-service supply chain support. It currently works with more than 20 national and regional chains that represent more than $1.2 billion annually in purchasing.
Editor’s Note: This increase in wholesale wing prices comes as the U.S. Department of Agriculture Economic Research Service reported consumers are paying 3.1 percent more to dine out this year over last.