Retail Traffic


For many of us, International House of Pancakes is as much a part of Saturday and Sunday morning as church services or the cartoons of our youth. Basic buttermilk, chocolate chip, or the German, French and Swedish pancakes that give the Glendale, Calif.-based chain its name — the exact choice doesn't matter. What we remember is the blue roof and breakfast anytime.

And if IHOP has its way, it will be a growing part of the American fabric. By the end of the second quarter of 2001, 935 of the restaurants could be found, spread across 41 states and Canada. According to IHOP's vice president for development Rick Celio, this reflects the chain's expansion into the South and Midwest. “The Midwest received the lion's share of the new locations,” he says, noting that IHOP intends to add 150 to 160 new restaurants this year and next. Targeted areas also include the Rocky Mountain states and the Texas-Oklahoma region.

As usual for IHOP, this expansion will be franchise-driven; 93% of its stores are operated by franchisees. But what is the chain looking for in the ever-tightening family dining niche? Well, as ever, location and demographics are key. Celio mentions that the chain likes locations with significant residential populations within a radius of a few miles, but since IHOP is a destination location in its own right (especially on those weekend mornings), there's a little flexibility here. Of course, the impulse diner is important as well, so Celio said the company welcomes the magnetic effect of a regional or super-regional shopping center.

Although IHOP considers any site it is offered, it prefers freestanding pad sites of between 40,000 and 50,000 sq. ft., which allows room for either the store's 4,000- or 5,000-sq.-ft. version (either of which seats in the neighborhood of 150 people), along with a minimum of 60 parking spaces. The company will also accept endcap buildouts, renovations of other buildings or demolitions of prior structures for an IHOP prototype. Freestanding units also require around 150 ft. of frontage — no matter how good the pancakes are, the customers still have to find them.

That's also where the company's identity package comes in. Its signature elements are its blue roof and awnings, with the full International House of Pancakes spelled out on the building. The more colloquial “IHOP” can appear on pole and monument signage.

Although the IHOP expansion continues apace, there are, of course, challenges along the way. Because the family dining segment remains crowded, IHOP realizes it has to establish and maintain a presence as more than a breakfast destination. Recent menu changes have included new emphasis on burgers, salads, and sandwich fare to go along with the signature items. On the development end, Celio notes challenges that include expansion into outlying areas of existing markets and the constant need to make sure that locations in the same market have sufficient “elbow room” — when a restaurant has the weekend destination appeal of an IHOP, franchisees are reluctant to surrender attractive territory, even to other members of the chain.

But ultimately, Celio notes, the expansion has been well received, even into parts of the country once considered foreign territory — the Southeast, for example. The brand's appeal is at a high, and customer e-mails prove consistently positive. So make sure you're ready — some Saturday morning in the near future, you'll wake up hungry.

And IHOP will be waiting.

W.S. Moore, III is a Muncie, Ind.-based writer.

TAGS: Retail
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