Thursday, February 7, 2013
10 Restaurant Chains that Flopped
Feeling famished? Got a hankering for a Lums hotdog steamed in beer, or a Gino Giant burger drenched in Ameche 35 sauce, the fabled "banquet in a bun"? How about a plate of Minnie Pearl's down-home fried chicken? Chi-Chi's tangy nachos grande? Or maybe you're in the mood for something classier, like Steak and Ale's signature herb-roasted prime rib?
Well, too bad, because those delectable treats were on the menus of national restaurant chains that no longer exist. Whether you're talking about humble burger joints or fancy sit-down dining establishments, the restaurant trade is relentlessly, mercilessly Darwinian. Just as the sabre-toothed tigers and mastodons roamed the land eons ago, there was a more recent time when American roadsides were dotted with orange-roofed Howard Johnson's restaurants and their promise of 27 different ice cream flavors, the gleaming ivory facades of White Tower hamburger stands, and Chi-Chi's imitation Mexican cantinas, among others. Some restaurant chains lost out because of diners' changing tastes, while others were swallowed up by larger competitors. And a few succumbed ignominiously to stock market scandals, unfortunate name choices and an occasional outbreak of food-borne illness. But we also must thank defunct restaurant chains for innovations that revolutionized American casual dining, ranging from the salad bar to special kids' meals.
10. Burger Chef
McDonald's 1950s success inspired a competitor, the Indianapolis-based General Equipment Manufacturing Company, to try its hand at cooking up even more efficient technology for peddling burgers and shakes. In 1958, General Equipment launched the Burger Chef chain, whose franchises were equipped with automatic conveyor broilers designed to churn out 800 flame-broiled patties with "cook out flavor" per hour, in addition to similarly prolific automated milkshake blending machines. By 1972, Burger Chef had grown to 1,200 outlets, second only to McDonald's 1,600. But too-rapid expansion turned out to be Burger Chef's undoing. Faced with declining profits, in 1981 then-owner General Foods sold out to Hardee's. But one Burger Chef legacy remains: the insidious fast-food marketing tactic of packaging a cheap plastic toy with a small hamburger, fries, drink and dessert, which it invented in 1973 with the Fun Meal.
9. Gino's
Numerous restaurant chains have tried sports themes, including Slammin' Hank Aaron's Barbeque Stands and the Muhammad Ali-endorsed Champburgers. But the prototype combination of sports and fast food may have been Gino's Hamburgers, founded in 1957, the namesake of NFL Hall of Famer Gino Marchetti. Gino's was a hit with commercials featuring comedian Dom DeLuise as the "Gino's Genie," and with its "Ameche 35" burger sauce. The chain grew to 330 outlets in 1972. A decade later, Marriott bought the chain for $48.6 million and merged it into Roy Rogers. Marchetti revived the name when he opened the first restaurant in a new chain in 2010.
8. Minnie Pearl Chicken
Country music themed-restaurant chains have included Conway Twitty's ill-fated Twitty Burger fast food chain, whose demise actually inspired a tax court judge to pen a song in Twitty's honor. But one of the most ill-starred was Minnie Pearl Chicken, a chain that capitalized on the cornpone persona of Grand Ole Opry comedienne Minnie Pearl (aka Sarah Ophelia Colley). A would-be rival to KFC, Minnie Pearl's opened 567 restaurants and sold 2,700 franchises in the late 1960s. In the rush to expand, Minnie Pearl's management reportedly neglected the chicken recipe, which varied from franchise to franchise, and first-time customers seldom returned. After federal securities officials forced the company to redo its 1968 filing to show $1.2 million in losses, investors sued, and Minnie Pearl's eventually vanished.
7. Sambo's
Sambo's was founded in Santa Barbara in 1957 by Sam Battistone and Newell F. Bohnett, who combined their names to form the moniker, apparently without realizing it was also an epithet directed at African-Americans. (In their defense, Helen Bannerman's children's book "Little Black Sambo," actually is about a dark-skinned child in India, not Africa.) In addition to serving its Sambo burgers and stacks of Sambo cakes, Sambo's had an innovative equity-sharing scheme that rewarded restaurant managers with a piece of the pie. When the chain reached its apex in the early 1980s, it had 1,117 restaurants. By then, though, Sambo's was already starting to falter financially. Worse yet, its name became such a lightning rod for anti-discrimination protesters that the company tried going by "Sam's" and "Jolly Tiger" in some locations. As the chain gradually collapsed in the 1980s, many of its locations became Denny's.
6. Steak and Ale
Steak and Ale was yet another creation of Norman Brinker, the legendary restaurant visionary who turned Jack in the Box and Chili's into runaway successes. Brinker started Steak and Ale in Dallas in 1966 to compete against the conventional full-service restaurants that he derided as "starchy" and overpriced. Brinker deduced that middle-class customers would flock to a joint that charged just $1.95 for an eight-ounce filet, which was something of a no-brainer. But he also wowed America with another innovation, the self-service salad bar. When Brinker sold the chain to Pillsbury in 1976, he had 109 restaurants in 24 states. Steak and Ale's success may have been its undoing, because the "casual dining" genre that it created became crowded with imitators. It ultimately became part of billionaire John Kluge's Metromedia Restaurant Group, which shut down its last 50 of the restaurants in 2009.
5. Chi-Chi's
You wouldn't think that a Mexican restaurant chain's founders would be two guys from Minnesota with Scottish-sounding names. But that's exactly what happened in 1976, when restauranteur Marno McDermitt partnered with former Green Bay Packers star Max McGee to open the first Chi-Chi's, despite warnings that the largely Scandinavian-American population in the area would reject the unfamiliar cuisine. The restaurant chain helped launch the Mexican food boom in the 1970s and 1980s, serving gigantic portions of intensely flavored food such as its chili powder, jalapeno-and-onion-laden nachos grande, with the help of an innovative computerized kitchen capable of serving up orders in nine minutes or less. As with Steak and Ale, Chi-Chi's success spawned scores of competitors, and in late 2003, the restaurant chain was forced to file for bankruptcy due to poor cash flow. Shortly after that, the Mexican green onions that helped make Chi-Chi's food so tangy became its undoing, when a batch tainted with Hepatitis A sickened 660 diners and killed three at a Chi-Chi's in Pennsylvania, leading to the chain's demise the following year.
4. Lums
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Business,
Business Operations,
Money
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