4 Once-Largest Restaurant Chains In America That Went Out of Business
Similar to other industries, rankings in the restaurant industry change over time, as companies expand, contract, and compete for limited consumer demand. While Subway, for example, was at one point the hands-down largest restaurant chain in the world, it was officially overtaken last year by McDonald's—and will most likely be overtaken in the near future by Starbucks.
In just the same way, the largest restaurant chains of decades past are not the same as the largest restaurant chains of today. In an industry with a 30% failure rate, here's a look at four restaurant chains that once ruled America's fast-food scene, but are now just a distant memory. No one's too big to fail!
Beloved for its fried clams, frankforts, and signature ice cream available in 28 flavors, Howard Johnson's was once the largest restaurant chain in the U.S., with a footprint of over 1,000 locations. HoJo's popularity peaked in the '60s and '70s, but declined shortly thereafter, as the chain struggled to keep pace with competitors like McDonald's and KFC.
CEO Howard B. "Bud" Johnson sold the company to Imperial Group (a British tobacco company) in 1979 for $630 million, and five years later Imperial passed the brand along to Marriott for about half the price. Marriott went on a restaurant closing spree, culling the number of company-owned HoJos and reducing the chain's footprint to a fraction of its original size.
With the recent closure of Howard Johnson's last remaining restaurant—a location in Lake George, N.Y.— the former giant is officially gone for good.
Red Barn, founded in 1961 in Springfield, Ohio, was beloved for its Big Barney and Barnbuster burgers (the former of which predates the Big Mac),
The brand was acquired in 1963 by Richard O. Kearns and developed into a huge franchise with a domestic footprint of 300 to 400 restaurants across 19 states. It even had branches in Canada and Australia.
Red Barn's progress, however, slowed when it was acquired by United Servomation in the late '60s and, within a decade, absorbed by City Investing Company, the parent company of Motel 6. Interested primarily in the chain's real estate, the investment firm phased out Red Barn operations, putting an end to the brand's marketing and allowing franchisee leases to expire. By 1988, the once-beloved Red Barn was no more.
Founded in 1954, Henry's Hamburgers got its start as an offshoot of Bresler's Ice Cream, a Chicago ice cream chain. While Henry's was originally intended as a vehicle for Bresler's popular malts and milkshakes, by the mid-'60s it had taken on a life of its own, expanding to over 200 restaurants coast to coast (even outnumbering McDonald's at one point).
But with the growth of other burger brands like Wendy's and Culver's, the fast-food industry became increasingly competitive. Failing to keep pace with its peers, Henry's entered a decline in the '70s. Today, there is just one Henry's Hamburgers remaining—a location in Benton Harbor, Mich.
Burger Chef was founded in 1957 in Indianapolis. Leveraging a number of industry innovations, including a patented flame broiler and fast-food's first kids' meal, its popularity and footprint grew rapidly.
The chain saw major growth in the '60s and '70s, going from 600 restaurants in 1968 to more than 1,000 by 1972 (putting it roughly on par with McDonald's, which, in the same year, had a footprint of about 1,600).
By the late '70s, however, the brand was beginning to lose its footing, and again, the culprit was growing competition. While Burger Chef managed to set itself apart with its kids' meals, which debuted in 1973, it failed to retain its monopoly on the lucrative menu category.
In 1978 McDonald's launched the Happy Meal and Burger Chef lost a subsequent copyright lawsuit. The chain rallied in 1978 with a Star Wars licensing agreement but still couldn't keep pace with Mickey D's and all its innovative ideas.
Hardee's acquired Burger Chef in 1981 for $44 million and lost no time rebranding most of the chain's restaurants.