Fat Brands operates about 15 restaurant chains, most of which the company has acquired over the past five years. It’s inevitable that some of them would end up in the same building eventually.
On Monday, for instance, the Los Angeles-based company announced the first cobranding union between Johnny Rockets, which Fat Brands bought in 2020, with Hurricane Wings, acquired two years earlier. The location is in a Washington D.C. Holiday Inn.
The cobranded restaurant is the full-service version of another cobranding idea the company has operated with some success in recent years: Fatburger and Buffalo’s Express. The latter chicken wing concept, patterned after Wingstop, was largely developed as a cobranding opportunity. There are about 100 such locations.
“Burgers and wings go well together,” Fat Brands CEO Andy Wiederhorn said in an interview. “People come and each gets a burger and shares a basket of wings.”
Cobranding was developed more than two decades ago, pushed by large companies such as KFC-Taco Bell owner Yum Brands to put different menu types under a single roof in a bid to capture cars full of consumers who can’t decide between, say, chicken and Mexican. It slowed down as companies opted to narrow their focus and some brands struggled with the arrangement.
But cobranding has had something of a renaissance amid shifts in consumers’ dining habits and operators’ eagerness to do more with their real estate. Companies like Atlanta-based Focus Brands, which operates mall concepts Cinnabon and Auntie Anne’s, have experimented with drive-thru units cobranding them with some of its other concepts.
It also helps Fat Brands sell its concepts to franchisees. Franchisees are often the ones who bring up the idea of cobranding, rather than the other way around, in part because the operators want to operate their space more efficiently. “We’re trying to find other ways to generate revenue for the franchisee, when they’re already paying for real estate,” Wiederhorn said. “The franchisee is our customer. It’s the guy running the restaurants. It’s not the guy eating burgers, shakes and fries.”
In addition to the 100 Fatburger-Buffalo’s locations, Fat Brands has about 125 locations of a Marble Slab Creamery combined with a Great American Cookies. There are also some tri-brands, such as a Fatburger, Buffalo’s and Hot Dog on a Stick. Wiederhorn also said there are some Fatburgers that could go into a Round Table Pizza.
“A lot of guys have the kitchen to be able to pull it off,” Wiederhorn said. “In the old days, we’d sell a guy a Fatburger or a Johnny Rockets. Now that they know about cobranding, they’ll ask about it. And they’ve seen it in several models.”
For the franchisee, the reason for the combination is simple: Adding another brand generates extra revenue. Wiederhorn said adding a Buffalo’s to a Fatburger generates 20% in additional revenue.
And while cobranding slowed in part because many cobranded restaurants focused on one brand at the expense of the other, Wiederhorn said that’s fine so long as the company understands the possibility. “There’s always going to be a dominant brand,” Wiederhorn said. “For us the burger brand is dominant.” At the same time, with niche products such as with Marble Slab and Great American Cookies, the cobranding tends to be more equal.
The Johnny Rockets-Hurricane concept is the first Fat Brands has tried involving two full-service brands. That, too, is increasingly common. BBQ Holdings, sold recently to Canadian brand collector MTY Group, combined a Granite City restaurant in suburban Minneapolis with a Village Inn.
The Johnny Rockets-Hurricane combo may be interesting for another reason: That restaurant is in a hotel. The restaurant will serve breakfast and handle room service for the Holiday Inn. The hotel operator is the franchisee.
This is Fat Brands’ first hotel location. In this case, the hotel approached the company about the possibility. “It’ll have legs,” Wiederhorn said. “We’ll have to see the data. But there are plenty of Class B hotels that could certainly take advantage of this model and sub out the restaurant.
“It makes it cool and trendy instead of the traditional restaurant buffet.”