​That Delivery Burrito Came From Denny's: Inside The Diner's CA Online Empire

CALIFORNIA — While California’s new $20 fast food minimum wage law has some eateries scrambling, Denny’s appears to see it as an opportunity to wrap up the competition with its virtual burrito concept, according to reports.

If you’ve ever ordered delivery from Banda Burrito, your meal came from a Denny’s kitchen, Restaurant Business Magazine reported Wednesday.

“Most of our locations are open 24 hours a day,” Sharon Lykins, vice president of product innovation, said, according to a June report from Franchise Times. “This is about taking the opportunity to maximize our labor force without using a lot of new ingredients.”

While fast food spots must pay employees $20 an hour or more as of April, Denny’s is a sit-down restaurant and therefore required to pay a minimum of only $16, according to the magazine, which noted tip income puts the diner chain in a position to remain competitive for prospective workers.

As a result, Denny’s can price its delivery burritos to compete with fast casual chains such as Chipotle, the magazine reported. The Banda Burrito concept was rolled out to 300 stores as of late June and is expected to expand nationwide by fall, according to the magazine.

“Approximately 70% of our Gen Z and millennial guests utilize our off-premise channels compared to the same groups utilizing dine-in at approximately 40%,” CEO Kelli Valade said, Restaurant Dive reported in May.

Denny’s has two other virtual brands — The Burger Den and The Meltdown, both of which launched amid the coronavirus pandemic, according to Fox Business.