Koo Koo Roo Menu Turns Red as Burgers Make Rare Addition

By DAVID GREENBERG
Staff Reporter

Rick Wilson walked into his neighborhood Koo Koo Roo expecting to buy some chicken for dinner, but what he found was something else.

The mid-Wilshire location was selling Fuddruckers burgers choice of beef or ostrich along with the usual Aussie-style chicken and turkey.

"I had no idea when I walked in," said Wilson, a Fuddruckers loyalist who would otherwise have to travel to Pasadena, Sherman Oaks or Burbank to sate his desire. "Their burgers are different than anywhere else."

Fuddruckers Inc., the Beverly, Mass.-based company that purchased Koo Koo Roo out of bankruptcy in December, is looking for more Rick Wilsons out there. Last month, it began testing its self-proclaimed "world's greatest hamburgers" in the chicken outlets that pioneered the concept of healthy fast food.

So far, the six Koo Koo Roo locations in Southern California that have introduced burgers have seen a 5 percent to 10 percent increase in sales. At the Miracle Mile outlet, they already represent 18 percent of sales, says Butch Cooper, Fuddruckers' vice president of operations.

"Meat is in right now," said Janet Lowder, president of Rancho Pales Verses-based Restaurant Management Services. "With a lot of potential customers, it would give them an alternative."

Meanwhile, all 18 Koo Koo Roo outlets are being redecorated to create a more family-friendly environment.

White walls have been repainted burnt orange, the ceilings are dark blue and the flooring and furniture are about to be replaced. Condiment stations that are familiar to Fuddruckers customers have been installed, along with Keating Mirror "clam shell" grills that allow the staff to cook even a well-done burger in less than four minutes.

"It was a cafeteria environment very sterile," said Heather Hajdu, Fuddruckers' restaurant designer. "My goal is to make it more of an intimate dining experience."

Spiced-up food

The strategy is designed to leverage Koo Koo Roo's prime locations while using the burgers to spice up its menu.

"The co-branding of Koo Koo Roo gives us the opportunity for expansion in markets where we've never existed," said Cooper. "We've not launched any marketing programs for this. We haven't done anything except sell the burgers at this point."

The program's success will largely depend on the ability of Fuddruckers, with only nine locations locally, to add to its customer base without alienating Koo Koo Roo's chicken- and turkey-loving customers.

"Koo Koo Roo has always been well received by guests," said Fred LeFranc, president of Newport Beach-based Ruby Restaurant Group, which operates 40 Ruby's Diner locations nationwide. "(Co-branding) is going to be confusing to the public. If you're trying to attract new business, you have to be careful not to lose your existing customer base."

Co-branding has occurred elsewhere in the fast-food world with varying success. Carl's Jr. has Green Burrito, Pizza Hut has Taco Bell and El Pollo Loco has Foster's Freeze.

But analysts are divided as to whether an appropriate fit is found in mixing high-calorie hamburgers with the boneless, skinless chicken and turkey meals and fresh salad that made Koo Koo Roo a pioneer in healthy casual dining.

"They hope to sell more chicken at night and hamburgers during the day, which is the normal pattern," said Randall Hiatt, president of Costa Mesa-based restaurant consulting firm Fessel International.

He added that hamburgers are back as a trendy item because the industry's tastes have shifted. A decade ago, the buzzword was "healthy"; today, thanks to the popular Atkins and South Beach diets, consumers respond to buzzwords like "quality" and "fresh."

Recipe for success?

With Koo Koo Roo, the problem has never been quality, but its ability to develop a profitable business model.

Founded in 1988, the chain's troubles mounted in the mid-1990s when it expanded into side businesses such as ceramics studios and gourmet coffee bars. After a stint with former Chrysler Corp. Chairman Lee Iacocca at the helm, the chain was merged into Irvine-based Family Restaurants Inc., which became Prandium Inc., in 1998. Prandium filed for Chapter 11 bankruptcy protection itself in 2002, and after Koo Koo Roo's filed for bankruptcy in October, Prandium shut down nine of the subsidiary's 27 stores. The franchise was sold to Fuddruckers last December.

Lowder said the locations purchased by Fuddruckers are good ones, noting that "if Fuddruckers does mini co-branding in select locations, it will improve (overall) market share."

Last week, Koo Koo Roo customer Susan Smith said she will continue to patronize Koo Koo Roo for its chicken and turkey, but she would rather get her burgers elsewhere, such as at Islands.

"I haven't ventured out," she said. "I guess I don't think of Koo Koo Roo as (being for) hamburgers."

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