BURGERS—There’s Magic in a Name: And It’s Fatburger

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When Earvin “Magic” Johnson, the retired Laker and 12-time NBA All-Star, announced last week that he was leading a group of investors in the purchase of the 47-unit Fatburger Corp., his strategy was simple: take advantage of a well known name.

Rather than “Magic,” however, Johnson is leveraging an existing brand and concept, continuing to avoid the pitfalls that have plagued concepts like Michael Jordan’s in Chicago and the sports-themed All-Star Caf & #233;.

In those ventures, athletes who put their name out front have generated short-term business, but often end up disappointing guests who expect the stars to be at the restaurants.

“He’s invested in good concepts,” said Ron Paul, president of Chicago-based restaurant consulting group Technomic, citing Johnson’s previous investments in TGIFriday’s and Starbucks.

“(Michael Jordan) wasn’t there,” said Paul of Jordan’s Chicago and New York restaurants. “And when he was there, he was behind glass.”

Johnson has, in essence, reiterated his desire to play second fiddle to the restaurant brand.

“I’m not like a typical celebrity that just wants to lend their name to something or throw their money in and then say ‘Whatever happens, happens,'” said Johnson. “I’m at the office every single day.”

Johnson is wary of those entertainers or athletes who believe a famous name is enough to support a successful restaurant.

“A lot of people still don’t know about Fatburger, so we’re going to market it to death,” said Johnson, who declined to disclose terms of the acquisition of the chain, which was founded in Los Angeles in 1952.

Those marketing plans include tripling the size of the chain in an aggressive expansion plan involving 100 new stores over the next five years.

The growth, from 47 to about 150 stores, will be led by Johnson Development Corp. President Kenneth Lombard and former Fatburger president and newly appointed Chief Executive Keith Warlick.

The expansion plan is expected to span eastward into 10 additional states. Warlick first worked with Fatburger founder Lovie Yancey in 1987, and was named president in 1996. “He’s withstood the test of time in the industry,” said Janet Lowder, president of Rancho Palos Verdes-based Restaurant Management Service.

Lombard added, “we think we have a product that’s universally accepted by everybody so there’s no need to make any adjustments.”

Johnson’s two theater complexes a third is scheduled to be opened in Houston at the end of the year do bear his name. But unlike renowned sports figures like Michael Jordan, Mickey Mantle and Tommy Lasorda, Johnson’s real push has been in using existing brand names rather than his own to further his reach in the $400 billion U.S. food and beverage industry.

And while he said there were some celebrities and athletes who have expressed an interest in franchising opportunities, he’ll demand they share his approach.

“They have to put in quality people who understand the hamburger business,” said Johnson. “We’ve got to protect the brand.”

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