An espresso martini with a stack of buttermilk pancakes and a side of Buffalo wings? Coming right up for customers at the new Applebee’s-IHOP dual-branded restaurant in Seguin, Texas, which opened Tuesday. And you can order that combo for breakfast, lunch, dinner or a late-night snack.
The restaurant, operated by parent company Dine Brands in partnership with franchisee Ramzi Hakim Group, features a full Applebee’s-style bar and seating in one half and IHOP’s signature turquoise and orange booths on the other side. Guests can mix and match items from both menus from breakfast through late night, plus there are several “menu mashups” exclusive to this co-branded location—the first in the U.S.
IHOP's familiar booths line one section of the dual-branded concept.
“The international team came up with the idea about two years ago, and we now have 18 dual-branded units, primarily in the Middle East and Mexico,” said John Peyton, CEO of Pasadena, California-based Dine Brands, who was onsite for the opening. “Each of those restaurants does one-and-a-half to two times the revenue than a single brand does in the same size store.”
Co-branding is more common in quick-service than full-service, but QSRs may cover only breakfast and/or lunch, while IHOP and Applebee’s together cover four dayparts, “which is tremendous economics for our franchisees,” he adds. The Seguin location is the first of 12 to15 hybrids the company is planning to open by the end of 2025. Most will be conversions of existing restaurants.
The transformation
The Ramzi Hakim Group alone has plans to open four more dual concepts this year, said Danny Hakim, who worked with the Dine Brands team to mastermind the renovation of the former IHOP franchise into the dual-branded restaurant.
“We closed the restaurant for three months for the remodel,” said Hakim. “It’s the same footprint as the original IHOP, but we added a bar, a few pieces of kitchen equipment and made some cosmetic changes. The cost wasn’t much more than the average remodel.”
The kitchen was given a facelift and the prep and cooking line reconfigured to accommodate a char broiler, combi oven and extra fryers needed to execute Applebee’s menu items. “The flow is still being tested, and the goal is to learn from this first model.”
Chelsea, serving a mimosa at the bar, gained experience at one of Hakim's Applebee's.
One of Hakim’s experienced GMs is overseeing the restaurant, and a group of the franchisee’s employees from other units were brought in and trained to handle the dual concept. Additionally, new hires were made and trained on the new model.
“Dine Brands invested heavily to build out the team,” said Hakim.
Added Peyton, “we did learn that some of the existing team members here struggled a bit with learning two menus, both in the front- and back-of-the-house. So we had about a 50% turnover in staff and we hired people who had a more appropriate skill set.”
The menu
The menu is the same size as a traditional Applebee’s or IHOP’s menu would be and includes the best items from both brands. At international locations, about 50% of guests order from both sides of the menu.
“We started by looking at the menu at the international co-branded restaurants. Then our IHOP and Applebee’s culinary leaders came together and crafted several new items exclusive to this restaurant,” said Peyton. “They also looked at any item that was similar, not duplicating burgers, chicken fingers, etc. We didn’t complicate the back-of-house by going from 100 items to 200 items; we kept it at about 100 items so the kitchen and operations remain smooth and easy.”
On the supply side, no new SKUs were added, although Hakim did have to find a liquor vendor near Seguin, since the former IHOP didn’t serve Applebee’s famous margaritas and martinis.
Sharing SKUs paved the way for those exclusive “menu mashups” created for the dual-branded concept. Applebee’s chicken tenders and IHOP’s signature omelette come together in a Loaded Buffalo Chicken Omelette with jack and cheddar cheese, ranch dressing and buffalo sauce. There’s also a new Steak and Eggs entree at breakfast, along with the Ultimate Breakfast Burger topped with bacon, cheese, hash browns and an over-easy egg with poblano hollandaise. On the lighter side, guests can order a Berry Balsamic Grilled Chicken Salad with berries and avocado.
The Loaded Buffalo Chicken Omelette is one of the new menu mashups.
Any time of day, guests can accompany these dishes with an Irish coffee, bloody Mary or one of Applebee’s “Mucho Cocktails,” like a Blue Hawaiian Long Island Iced Tea or Shark Bowl.
On opening day, the bar was already packed at breakfast on the “Applebee’s side” while customers in the turquoise booths on the “IHOP side” were working their way through stacks of pancakes, Loaded Buffalo Chicken Omelettes and mimosas.
“We wouldn’t be doing this if we didn’t think it would be a big driver of unit growth for us over the next couple of quarters or years,” said Peyton. “It makes sense economically and it’s a unique proposition for our guests.”
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