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2009 Chain Operator of the Year - Johnny Rockets

With new locations popping up worldwide and a prototype mobile unit taking its grilled-to-order burgers on the road, Johnny Rocketts is paving the way for a new era of growth.

Where Lake Forest, Calif.-based retro-themed burger chain Johnny Rockets has found itself mentioned in the press this fall, it has often been in the context of a side note about its charismatic owner: Dan Snyder, whose Red Zone Capital Management private-equity firm also owns the struggling Washington Redskins football franchise. This is too bad, because Snyder's lesser-talked-about venture has been busy racking up some impressive stats: 25 percent unit growth over the past 32 months, for example.

And in August, Johnny Rockets debuted in Washington, D.C., its first mobile unit—a sleekly customized 34-foot truck with 22 feet of kitchen space that chain President and CEO Lee Sanders views as an important new way to broaden the brand's reach. With more than 250 units open in 13 countries, Johnny Rockets is closing out 2009 with an eye toward hitting the 1,000-store mark within the next decade and making its name synonymous worldwide with grilled-to-order burgers served with a side of what it calls "feel-good Americana."

"We're building a world-class team," Sanders says. "People love us—we have an avid fan base, and it's fun to work at a place where people really love your brand."

tabletop items
Johnny Rockets remains fiercely loyal to the 23-year-old company’s brand of mid-twentieth-century dining nostalgia, right down to its tabletop items.
What stands out about Johnny Rockets' drive toward becoming a top fast-casual concept in the United States and a globally recognized burger brand is that its leadership embraces virtually any and all expansion prospects—on military bases, in theme parks, on cruise ships, and even in the worst recession in a generation—while remaining fiercely loyal to the 23-year-old company's brand of mid-twentieth-century dining nostalgia. Johnny Rockets always has sought to differentiate itself from burger-proffering competitors by providing a singular, signature dining experience that doesn't force guests to sacrifice comfort in the name of burger quality or convenience. Since opening its first unit on Los Angeles' Melrose Avenue in 1986, Johnny Rockets has aimed to be the burger joint where guests can, yes, get it all: made-to-order food and beverages, plus speedy service and a relaxed, entertaining, family-friendly atmosphere.

trade dress
While the restaurant chain may be expanding into non-traditional venues such as airports and stadiums, Johnny Rockets’ trade dress makes it instantly recognizable to consumers regardless of the location.
"We're sticking with the success formula that for 23 years has made us a leader," Sanders says. "We have a unique trade dress; it's not very hard to use us; and we believe our food is superior to many other folks in our category. We're staying true to what we know how to do best."

Locations, Locations
Cancun, Mexico, airport
Johnny Rockets operates more than 250 units open in 13 countries, including this one in the Cancun, Mexico, airport.
Such confidence in the belief that never-frozen burgers and hand-dipped, real-ice-cream milkshakes delivered by servers in crisp white uniforms boast universal appeal—regardless of whether the "classic diner" is part of a particular area's cultural vernacular—has spurred Johnny Rockets to welcome opportunities to open stores in regions as diverse as Mexico (nine units), Kuwait (seven) and, as of October, the Philippines (one).

In June, the chain announced a partnership with independent global branding consultant William Van Epps to explore and promote Johnny Rockets franchising opportunities abroad. Van Epps, formerly a president of Papa John's International, is focusing his franchisee-recruiting efforts on Southeast Asia; his hiring by Johnny Rockets is the latest in a series of personnel moves in the last two years that is helping put the brand on the map, literally.

Lee Sanders arrived at the chain in May 2007 from Minneapolis-based Buffalo Wild Wings, where he served as senior vice president of development and franchising. In his five-plus years in that position, Sanders helped oversee the restaurant chain's evolution from a beloved regional concept to a dominant—and profitable—national player. He credits Buffalo Wild Wings CEO Sally Smith for showing him how a brand can multiply its number of units while maintaining the passion that helped it resonate with guests in the first place.

"I owe a debt to Sally Smith for the things I learned from her as far as running a company," Sanders says. "Looking at the cultural stress that geometric growth can cause and being ready to deal with that" has been one of the most important lessons from the Buffalo Wild Wings experience, he adds.

Sanders took the reins at Johnny Rockets just three months after Dan Snyder's Red Zone Capital acquired the chain. Johnny Rockets' founder, the late Ronn Teitelbaum, had no small plans for the concept; he built the chain to an impressive 60 units before selling it to New York City private-equity firm Patricof & Co. in 1995. But now, Snyder and Sanders are working to nearly quadruple in size a nearly quarter-century-old chain.

Snyder "is going to do what it takes to win," Sanders says, adding, "It's fun to work for a guy who's a self-made person."
Johnny Rockets' new growth spurt isn't necessarily coming easily. While international expansion has ramped up in the last two years, some U.S. markets—namely California, Arizona and Florida—have seen sales and growth prospects soften. And Snyder's other major entertainment venture, the Six Flags amusement parks, purchased by Red Zone Capital in 2006 and home to licensed Johnny Rockets units, filed for bankruptcy in June. (Sanders says that the Six Flags bankruptcy has "really not at all affected" Johnny Rockets.)

But 2009 also has been a year of firsts for the chain: In May, Johnny Rockets opened its first unit on a U.S. military base—a 1,800-square-foot facility at the Marine Corps' Camp Pendleton in Southern California. Four months later, the U.S. Air Force Base in Ramstein, Germany, became home to the chain's first unit in Europe.

Lest anyone think that an international store opening is ho-hum, Philippine Vice President Noli de Castro showed up to the September grand opening of Johnny Rockets' first Asian store, in Quezon City (the Philippines' largest city). Sanders notes, too, that development rights have recently been sold for units in Chile, Panama and the Dominican Republic.

In the United States, nontraditional formats—the mobile truck, which opened for business at the Redskins' training camp in August, and a new restaurant in the upscale Carson Lanes Bowling Center in Carson City, Nev.— give devoted Johnny Rockets fans new ways to experience the restaurant and introduce the concept to consumers who haven't had the chance to visit one of the chain's conventional stores.

"When we talk to our guests in consumer research, one of the things that they've told us is, 'I want your products to be where I am,'" Sanders says. "They say, 'I want them in my neighborhood; I want them when I'm at the softball field; I want them at the Redskins' FedEx Field.'" Nontraditional units, he says, are "just a way to get the food and the brand to the guests."

Menu Focus
Handpressed, grilled-to-order classic and specialty burgers are at the heart of the Johnny Rockets menu, but they aren't the only nostalgia-oriented draw. While being careful not to stray too far from the burgers-fries-shake formula, Johnny Rockets has looked to menu innovation to help keep an old-school concept in touch with changing contemporary tastes.

Turkey and vegan burger patties have been available for substitution in Johnny Rockets' 12 signature beef-based burgers for years. In March, the chain joined the ever-growing crowd of operators offering sliders, but it used the introduction to do more than market downsized hamburgers. Johnny Rockets took advantage of the slider format—a plate of sliders is, after all, perfect for sharing—to introduce four new burger sauces: ancho-chipotle, sweet-pepper relish mayo, a mayo-Dijon blend and chunky blue cheese. What's more, Johnny Rockets also simultaneously introduced mini hot dogs and mini chili dogs. And as a value proposition, the chain offers a "pick any five" combination of sliders and mini dogs at a set price that varies by market. "The mini dogs are actually outperforming the sliders," Sanders notes.

Discounting and dollar menus have never been part of Johnny Rockets' sales strategy, but in an effort to play up affordability, the chain soon will introduce a price-oriented menu—working name: the Extreme Value Menu—and for the holidays will send via direct mail an oversized postcard with a buy-one, get-one burger offer. "I wouldn't claim it's incredibly innovative, but it's different for us," Sanders says. Johnny Rockets also promotes the fact that its American fries are all-you-can-eat with the purchase of most sandwiches (tuna- and egg-salad sandwiches and the Philly cheese steak excluded).

Additionally, establishing a brand presence on Facebook, MySpace and Twitter and using those social-media vehicles to announce new menu items as well as special deals and giveaways has helped communicate the message that Johnny Rockets is in touch with guests' interests and needs. A recent Twitter offer promised tickets to the American Music Awards' red-carpet arrivals party in Los Angeles to the first five people to post their favorite shake, for example. And the chain uses its Facebook wall for everything from crew-member recruitment to the announcement of store-specific promotions.

Keeping it Consistent
Consistency is key in turning out 13 million grilled-to-order burgers a year, and Johnny Rockets relies on a short list of suppliers and vendors to help ensure that a patty melt in New York tastes the same as a patty melt in San Diego. Clamshell grills represent the workhorse of the Johnny Rockets' kitchen. This applies to the restaurant chain's mobile truck, which contains a clamshell grill capable of producing 180 burgers per hour. Over the past two years the chain has narrowed its list of equipment distributors to three; franchisees have their choice of suppliers based on region. Additionally, four vendors provide the meat for U.S. stores. "We have an incredibly tight spec" for Johnny Rockets' one-third-pound burger patties, Sanders says. "The raw goods are almost identical in all markets."

To better control product consistency at the store level, Johnny Rockets earlier this year debuted a Grillology retraining program for line cooks. Introduced in February, the "fairly massive" program has so far been rolled out to 40 percent of the chain's markets, Sanders says; the goal is to have all line cooks become "grillologists." "A properly cooked burger is almost the cornerstone of what we're trying to do," he says. Instruction sessions, which offer lessons on everything from flipping technique to grilling times for hamburger patties, chicken breasts and sliced sirloin (for Philly cheese steaks), take place in each marketplace's certified training stores.

Old-Fashioned Service
Front-of-the-house training also is vital to being able to deliver to every guest, every time the signature Johnny Rockets experience—the kind of friendly service-with-a-smile that consumers associate with an earlier era of dining. Thoroughly explaining to all new crew members the Johnny Rockets guest promise—a commitment whose five tenets include "Say 'hello' and offer a smile to every Guest we see" and "Handle Guest needs right here and now"—helps "set the expectation that guest satisfaction is what we require," says Sanders. "We're not interested in anything less than perfection."

Having servers perform a short choreographed group dance at 30-minute intervals certainly helps keep energy in the stores high, ensuring that the atmosphere guests find is always fun, never sleepy. From a hiring perspective, it also helps attract individuals who have the kind of outgoing, lively personality that the company seeks. (Managers and corporate staff, too, are reminded of the company's mission and vision: The Johnny Rockets guest promise is printed on the back of all company business cards.)

Crew members and new hires tapped to become general managers or assistant GMs participate in a five-week management training program, again with sessions conducted in a Johnny Rockets certified training restaurant. Managers at all company-operated restaurants and many franchised locations receive medical, dental, vision and life insurance and can participate in a company-matched retirement-savings program.

outdoor seating
Outdoor seating is part of the guest appeal at Johnny Rockets’ Atlantic City location.
General managers singled out by franchisees or other supervisors as ready for the next level within Johnny Rockets—typically a district or regional manager position—take part in a master's training program, which emphasizes multiunit management.