Burger King Franchisor Buying Burger King Franchisee

There's a Burger King outlet near my place, but I have never patronized it in the three years I've lived there. One day, I decided to order something and realized all the self-order kiosks were out of order.

Conversely, I have patronized its sister brand, Popeyes, several times, and even more frequently its competitor, McDonald's. I believe my experience isn't unique. Indeed, some may argue that Burger King serves better burgers than McDonald's, but the reality is that more people purchase from the latter.

This is probably why Restaurant Brands International (RBI), the parent company of Burger King, lags behind not just McDonald's, but also Subway, Starbucks, and Yum! Brands in terms of the number of outlets.

RBI (NYSE:QSR) was first formed through a $12.5 billion merger between Burger King and Tim Hortons in 2014. The Brazilian investment firm, 3G Capital, owned Burger King, and after the merger, it retained a 31% stake in RBI.

RBI expanded its portfolio by adding two more brands: Popeyes in 2017 and Firehouse Subs in 2021.

RBI seems to have adopted an underdog strategy, where each brand competes against an established market leader: