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Wendy’s gets in breakfast game, Burgerim franchisees organize in wake of disaster



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Wendy’s breakfast menu was designed with low complexity in mind and using existing equipment.

Get ready for Breakfast Baconators, Frosty-ccinos and Honey Butter Chicken Biscuits. Wendy’s announced breakfast will roll out across its U.S. locations March 2. Breakfast has been a bit of a headache for the company in the past, as it launched a breakfast menu three times before, but none of those efforts were national programs. CEO Todd Penegor said the company learned a lot from those programs. “You never want to hear that, but it is different this time,” said Penegor. “I know there’s a lot of skepticism, people say we’ve failed three times. But we’ve never launched breakfast nationally; this is our first national launch. And we never brought the franchise community along the way we brought them along. We brought in our top 300 owner-operators about a month before our convention, before we announced to the street that we were going into the breakfast daypart.” Ahead of the launch, the company held tests in 300 locations. Because the new program mostly utilizes existing ingredients and equipment, there’s been limited additional complexity. In all, breakfast adds 18 new items. The company also invested $20 million to help fund the minor equipment updates.


Burgerim ‘Zees Organize

As the viability of Burgerim’s franchise system remains in question, a group of operators January 24 announced the formation of the Independent Association of Burgerim Franchisees “to unite their common resources to address the serious challenges to their brand, and to protect their franchisee investments.” Working with the American Association of Franchisees and Dealers, a nonprofit trade group, the Burgerim franchisee association formed following reports of mismanagement and misappropriation of franchisee funds within the system, along with a host of other concerns, including the sudden departure of Oren Loni, the brand’s owner. “The goal of IABIMF is to unite and unify Burgerim franchisees, engage common legal counsel and aggregate franchisee resources to take immediate steps to protect and preserve franchisee investment,” said Joey McCullough, interim chairman of the chapter steering committee in the announcement.


Bar Louie’s Decline

Bar Louie hired an investment banker to sell the chain of 134 restaurants last fall, but three letters of intent turned up no deal. Now the Addison, Texas-based chain has filed for Chapter 11 bankruptcy protection, is closing 38 stores and is seeking bids from its secured lenders, for a minimum bid of $82.5 million, in hopes of attracting a new buyer. “No two Bar Louie restaurants are alike,” says Bar Louie’s promotional materials in a pitch often made to franchisees, who were allowed unusual freedom to cater their stores to local markets. It’s ironic, then, that “inconsistent brand experience” was cited as one of three reasons for the decline at the chain. The other two were recent expansion and decreased traffic at malls. Revenue was down 3.7 percent to $252 million last year, and the declines were “accelerating,” the company said. Its bankruptcy filing lists more than $100 million in debt. The sale through Chapter 11 “will help us to focus on our profitable core locations and expand in areas that have a proven track record of success,” said Tom Fricke, CEO, in a statement. Private equity firm Sun Capital Partners bought Bar Louie in 2010.


Seed for Curry Up Now

Liquid 2 Ventures, a seed-stage venture capital firm, is getting into the restaurant business, investing in fast-casual Indian franchise Curry Up Now. The San Francisco-based firm counts among its founders Hall of Fame quarterback Joe Montana, also a serial angel investor. Founded by husband and wife Akash and Rana Kapoor, Curry Up Now started as a Bay Area food truck in 2009 and has since grown to eight brick-and-mortar locations to go along with three food trucks and two Mortar & Pestle craft cocktail bar concepts. Curry Up Now’s franchise investment range is $339,200 to $777,800.

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