Huddle House

From the pages of Restaurant Franchising
Huddle Up for Something New

Huddle House has been around for 47 years and has weathered decades of ups and downs, but the company recently renovated and unveiled new designs for its stores, and is ready to continue its growth.

“We are an iconic brand,” says Mark Whittle, chief development officer at Huddle House. “We offer high-quality food at a value price.”

To revitalize its nearly 400 restaurants, Huddle House introduced its Evolution Design. “The brand is evolving. Each store will have a Huddle Booth, as well as other new iconic elements,” Whittle says. “The Huddle Booth has a slightly different feel, different colors, and different fabrics. We want it to be the place to be, the cool spot, the place people hope they can get when they come in. We want people to ‘Huddle In, Huddle Up, and Huddle Happy.’”

Huddle House targets markets where other full service restaurants may not go. “We appeal to rural communities; 98 percent of our stores are in areas where there are not more than 15,000 or 20,000 people in a five-mile radius. A lot of the chains won’t go in to those areas. We can and do, and we do well in these markets,” Whittle says. “There are a lot of those towns out there.”

Huddle House has made a science of going into small towns. “We built a site analytics model and determined the factors that drive sales, using the model and an optimization study to determine best trade areas for development. The model identified at least 1,200 future trade areas. Most are in the 20 states we are already in, although we will consider new states close to our current footprint. We are trying to grow where we are for now or in contiguous states.”

Keeping franchises small-ish is okay. “I’d love to see a lot of three- and five-store franchisees, but I don’t want to see it so big that it changes the business dynamic.” —Mark Whittle, Chief Development Officer

Huddle House franchisees are passionate about the business. “This is not one of those things you put money into and just hope it goes well,” Whittle says. “You had better be involved.”

Average ownership is just more than 1.5 stores, and keeping it small-ish is okay. “I’d love to see a lot of three- and five-store franchisees, but I don’t want to see it so big that it changes the business dynamic,” Whittle says.

“We appeal to operators because we have a favorable cost of entry. We are not building 5,000 square-foot stores. We build 2,200 square-foot buildings, and we are effective because with four, strong day parts, you can manage your business with a smaller footprint,” he says.

“Our internal food distribution system makes it possible for us to offer the lowest operating costs for the franchisees while still providing the highest level of quality and service. We serve only Huddle House stores,” Whittle says.

Like other franchisors, Huddle House is expanding into alternative venues. Truck stops, hotels, c-stores, shopping center end-caps, and freestanding conversions are part of the plan. “As long as the underlying real estate is good, it can work. The investment costs can be as much as 40 to 50 percent lower than doing a new build,” Whittle says.

Huddle House uses Boefly.com, an online portal that matches applicants with available loans, to streamline the process and to cast a broader net to secure funding. The franchisee fills in one application, and hundreds of lenders can view it.

Huddle House is currently offering an incentive, reducing the franchising fee by $5,000, and offering $5,000 worth of marketing. Huddle House’s ongoing veteran’s incentive reduces the upfront franchise fee by 50 percent.

“It’s a great time to be with Huddle House,” Whittle says. “We’ve got a new design, a great menu, and we are positioned well from a pricing standpoint with a refined marketing message and room to grow.” Who could ask for more?

For more information about franchising opportunities with Huddle House, visit www.huddlehousefranchising.com.