UVA-C-2206

WENDY’S CHILI: A COSTING CONUNDRUM
What happens to a successful company when it loses its founder, senior chairman, advertising icon, and beloved leader? That was the question being asked about Wendy’s
International, Inc., in January 2002 after Dave Thomas, 69, passed away from cancer. In the words of Jack Schuessler, the company’s chairman and CEO, “Dave was our patriarch. He was the heart and soul of our company.” Without him, the company would never be the same. However, Dave
Thomas left behind a legacy about values, ethics, product quality, customer satisfaction, employee satisfaction, community service and shareholder value that provided a solid foundation on which to continue the success the company had experienced for more than thirty years. Still, the patriarch was gone, and the future was uncertain.
How It Began
Wendy’s International, Inc., was founded by R. David Thomas in Columbus, Ohio, in
November 1969. Prior to that time, Thomas had purchased an unprofitable Kentucky Fried Chicken franchise in the Columbus area, turned it around, and subsequently sold it back to Kentucky Fried
Chicken at a substantial profit. He then became a cofounder of Arthur Treacher’s Fish & Chips. So, at the time he founded Wendy’s, Thomas was no stranger to the quick-service restaurant industry.
Although he had been involved with businesses specializing in chicken and fish, Thomas’s favorite food was hamburgers, and he frequently complained that there was no place in Columbus to get a really good hamburger without waiting thirty minutes or more. Someone finally suggested
(whether in earnest or in jest was debatable) that he get into the hamburger business and do it his way. After thinking it over, that’s just what he did, and he named his new company after his eight-year-old daughter, Wendy. His goal was to provide consumers with bigger and