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Business Insider
Taco Bell is giving customers exactly what they want right now: cheap fast food
By Nora Redmond,
2 days ago
Taco Bell seems to be winning the fast food wars right now.
Anneta Konstantinides/Business Insider
Taco Bell is one of the rare bright spots in the fast food industry right now.
The Yum! Brands-owned chain has been doubling down on value, and it's paying off.
Chains are trying to lure diners back in after high fast-food prices have turned many away.
Taco Bell has been going all in on value, and it's paying off.
The taco chain, which is owned by Yum! Brands, reported a 5% increase in same-store sales in the most recent quarter.
It outpaced its sister brands, KFC and Pizza Hut, and industry competitors such as McDonald's , which reported a drop in sales in the most recent quarter.
Earlier this year, it overhauled its Cravings Value Menu , adding six new "meal-sized" items that cost under $3.
And, it's offering deals such as its $7 Luxe Craving Box, which includes a Chalupa Supreme, Beefy 5-Layer Burrito, Double Stacked Taco, chips with nacho cheese sauce, and a medium drink.
"Taco Bell is a clear standout in today's environment, not only achieving same-store sales growth well ahead of the QSR category, but delivering restaurant-level margins near a record high" Yum! Brands' CEO David Gibbs said on the company's earnings call Tuesday.
"We have a great way to play value that makes it hard for others to compete," he said.
Taco Bell uses relatively inexpensive ingredients and offers smaller serving sizes to enable it to keep costs down.
The $5 deal is "a bridge value program," he told CNBC's Squawk Box. "I would consider the $5 menu sort of chapter one of a multi-chapter value playbook that we're going to be writing," he added.
Taco Bell's rise in sales was also attributed to new menu items such as the Cantina Chicken , which the company said performed above expectations.
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