Pricing

Workshop

A n i m p o r ta n t b u s i n e s s l e v e r t o u n d e rs ta n d

PRIVATE & CONFIDENTIAL

Original Pretzel COG’s

6.1%

Regular Lemonade COG’s

13.0%

Dog Bites COG’s

26.7%Bitz COG’s

7.3%

PRIVATE & CONFIDENTIAL

System pretzel

prices

Original = $3.80

Flavored = $4.17

Cheese = $4.54

System Bitz and

dog prices

Wetzel Bitz = $5.06

Wetzel Dog = $4.65

Cheese Dog = $4.95

Dog Bites = $5.89

System drink

prices

Reg Lemonade = $3.61

Reg Frozen = $3.78PRIVATE & CONFIDENTIAL

• Dog Bites are priced like Pizza Bitz

but Pizza Bitz drives more profit

• Low priced Dog Bites franchisees

should consider and evaluate

raising price

Bark up the right tree with Dog Bites

Pricing

PRIVATE & CONFIDENTIAL

• Cheesy dog bites earn

$0.35 more in sales but only

$0.19 more in profit

• On average, raise price

$0.16 on cheesy dog bites

to maintain profit margin

Dog Bites: manage pricing differentials

PRIVATE & CONFIDENTIAL

What has

happened to

the value over

the years

✓ Reg vs lrg drinks in 2013 = $0.45

✓ Reg vs lrg drinks in 2018 = $0.41

✓ Orig vs flavor in 2013 = $0.33

✓ Orig vs flavor in 2018 = $0.36PRIVATE & CONFIDENTIAL

AA’s Pretzels Price

$3.72

$3.87

$4.41

$3.76

$4.12

$4.48

Auntie Anne's

Wetzels

Original CheeseFlavored

Sample of 35 malls with an Auntie Anne’s and Wetzel’s

$0.54

$0.36

• Wetzel’s and AA’s

price are similar

• Cheese

differential is

greater at AA’s –

this is an

opportunityPRIVATE & CONFIDENTIAL

Bitz are a pricing opportunity

• Wetzel’s is consistently

priced lower than

Auntie Anne’s

• Our product weighs the

same as their large

• Pizza Bitz represents

the biggest opportunity

• This will help maintain

margin

$5.36$5.54

$6.26

$5.04

$5.43

$5.74Auntie Anne's

Wetzels

Original PizzaFlavored

Sample of 35 malls with an Auntie Anne’s and Wetzel’s

$0.72

$0.31

PRIVATE & CONFIDENTIAL

Fresh baked

pretzels will

cost $4

• Remember the $1.99 barrier

• How much do consumers spend

• Chipotle meal = $13.50

• Starbucks latte & muffin = $8.75

PRIVATE & CONFIDENTIAL

5 year average pricing trend

Fairly consistent

average price increases

4% compound annual

growth which is roughly

3x the Consumer Price

Index

$3.04

$3.37

$2.91

3.36

$3.79

$4.15

$3.61

4.02

2013 2018

+$0.78

+$0.70

+$0.66

Original

Pretzel

Large

Lemonade

Flavored

Pretzel

Regular

Lemonade

+$0.75

PRIVATE & CONFIDENTIAL

Watch your Fresh Lemonade price

Lemonade seems to be overpriced

on average

Sales for the category are down;

aggressive price a contributor$3.15

$3.54$3.58

$4.01Auntie Anne's

Wetzels

Medium LargeSample of 35 malls with an Auntie Anne’s and Wetzel’s

$0.39

$0.43

PRIVATE & CONFIDENTIAL

The annual pricing exercise

See annual pricing recommendations

PRIVATE & CONFIDENTIAL

• Increase prices 2 – 3x per year

• Move around the menu, take small price increments

• Price in advance of events – minimum wage increases and holiday for example

• Seek ways to improve attachments of dips and drinks

• Know your mall – look at competition

• Study price change impacts through Treatware

Franchisees have said…

PRIVATE & CONFIDENTIAL

Pricing at WP’s

has less of an

effect on

customer

count than you

may think

Consider

value and

market

expectations

Understand

the effects

on you P&L

Top three hot ideas

PRIVATE & CONFIDENTIAL

Is it time to pull the

pricing lever at your

bakery?

Consider

COG’s

Consider

system

averages

Consider

value

(original vs

flavored)

thank you!

PRIVATE & CONFIDENTIAL