Murphy: Foodservice Franchise Chain Reaction

For all the boasting about American superiority when it comes to technological innovation, for all the litany of convenient, labor-saving devices and appliances for which we credit our homegrown inventors, the truth is that so much of what we blithely post on the USA scoreboard has been previously or contemporaneously invented elsewhere in the world.

But there’s one entrepreneurial creation that has revolutionized business, culture and lifestyles, and it’s one for which American business moguls can take full credit: The invention of the franchise.

I’d argue that nothing characterizes, and impacts, modern lifestyles more than franchising. Where we eat, where we sleep when traveling and where we conduct serious business — filing tax returns, obtaining medical care, dropping off our children on a daily basis — most often involves patronizing a franchised business that has hundreds or even thousands of virtually identical locations around the country.

Practically every exit on every freeway in America has franchised businesses clustered around it like moths to a summertime porch light, and for the most part, we view that as a benefit, a tangible expectation of service and value in an otherwise uncertain sea of consumer choices.

For every modern-day success story, however, there have been numerous franchise failures, and none more so than in the restaurant category. What were once thriving, nationwide chains during the postwar decades later ended up downsized and/or disappeared. Some because they were ahead of their time; others because they failed to adapt to the times.

Here are three franchises that hit the big-time, but then faded away — for good reason:

Sambo’s. The first Sambo’s, a chicken-and-waffles-type format, opened in 1957, and even then, the nameplate was controversial. Founders Sam Battistone and Newell Bohnet always claimed the moniker was created by combining their names, but the name never lost its association with a derogatory term for African Americans. As an online retrospective noted, the fact that the restaurants’ décor displayed a racist caricature didn’t exactly buttress the owners’ credibility, and by the 1980s, virtually all of what were once more than 1,000 locations had been sold off or shut down.

Howard Johnson’s. The company was launched way back at the dawn of the Automobile Age in the 1920s, and grew along with American car culture. By the 1960s, there were close to a thousand of the restaurant-and-hotel chain’s distinctive orange roofs alongside highways nationwide. But failure to modernize the menus and the motels did in the company, and as of 2017, there is only one single HoJo’s still in business.

Chi-Chi’s was launched in the 1970s, and one of the investor-owners was former NFL star and hero of Super Bowl I, Green Bay Packers wide receiver Max McGee. The chain expanded rapidly, based on its semi-authentic “Mexican-style” menu. But tough competition within the category halted its growth, and a serious hepatitis outbreak in 2003 that led to three deaths proved to be the chain’s death knell.

Here are three chains that were innovative, but ultimately not competitive enough:

D’Lites. This burger chain launched a concept in the late ’70s, early ’80s that was ahead of its time, and perhaps a little left-of-center for its clientele, as well. D’Lites positioned its appeal on nutritional value, promoting its low-calorie cheese, high-fiber buns, and burgers made with lean ground beef. By the mid-80s, though, the company had expanded to more than 100 locations, but in 1986 filed for bankruptcy protection, ultimately selling most of its stores to Hardee’s.

Steak and Ale. Talk about a concept that arrived too early. Steak and Ale basically created the “cheap-steak-and-salad bar” concept, only to see newer, more innovative franchisees come along and do it better and cheaper. The word “ale” in the name didn’t help, either, and the chain’s last few locations permanently closed in 2010.

Burger Chef. Hard to believe some 30 years later, but in the 1960s Burger Chef had more locations than McDonalds. The chain also introduced a couple of concepts that have become industry staples, such as selling kids’ meals that included toys. In the end, though, they sold out to Hardee’s in 1981.

And here are three chains you thought had disappeared — but haven’t:

Bob’s Big Boy’s, featuring double-decker burgers and an iconic mascot was prominent on the American restaurant landscape in the 20th century. That’s no longer the case, but the chain still operates some 100-plus locations in California and in the Midwest.

Bennigan’s, one of the original casual dining/sports-bar concepts, was initially successful but was soon overtaken by rivals in the category. Although the chain filed for bankruptcy in 2008, new ownership has maintained operations at 23 locations in the United States.

Ponderosa Steakhouse. Thanks in part to a terrific name, the chain once numbered in the hundreds. Today, a parent company owns both Ponderosa and Bonanza Steakhouses, of which just under 20 are still in business.

One Last Note
Back in beautiful downtown North Greece, N.Y., where I grew up, a big community event (for us kids, anyway) took place in 1961: The opening of a brand-new Carols fast-food burger joint.

Only nobody called it fast-food back then; instead, it was more like “dinner.” My siblings and I used to beg our parents to please let us have the burger/fries/shake combo, instead of my Mom’s more typical liver/broccoli/beets combo.

Only they weren’t called combos back then.

Carols, in fact, was almost a clone of the fictional McDowell’s in the movie “Coming to America:” McDonald’s had a Big Mac, Carols had the Club Burger (two all-beef patties, a special sauce, lettuce, cheese, pickles and onions, served on a sesame-seed, triple-decker bun — sound familiar?). McDonald’s had a Fish Filet, Carols had a Sea Filet.

But the chain also offered fried chicken, a Roast Beef Hero and a toasted cheese sandwich, the latter of which sold for the grand total of 10 cents.

You can bet I ate $20-25 bucks worth of those babies during my high school career.

Because even though they were kind of greasy and soggy, they sure beat liver and broccoli.

Editor’s Note: The opinions in this commentary are those of Dan Murphy, a veteran journalist and commentator.