An Even Smaller Chef

Merlin, rather than Heston, may have been a better choice of alchemist for Little Chef.

Many years ago, I met a senior marketing bod at Little Chef and I pointed out that the menu looked a bit dated. As I remember it, I even suggested some menu changes but he said that he knew the market and people liked All Day Breakfasts. At the time I was working with a sales director who actually had an All Day Breakfast most days, for lunch, but even then he was a dying breed.

Little Chef has just announced that it is closing 67 of its remaining 161 sites. Apparently these sites have been “trading unprofitably for a number of years”. That doesn’t really surprise me. From personal experience, the signs of cost-cutting – particularly of staff – have been obvious for some time now. At its peak, in the 1970s and 1980s, it had 435 roadside restaurants and it was quite a treat to go to one.

Little Chef, formed in 1958, is just two years younger than I am and a lot can change in fifty-odd years – sadly, few businesses manage to change with the times. But both Pizza Hut and another US chain called International House of Pancakes were also formed in 1958 and have both thrived. Interestingly, IHOP now has 1500 outlets through the US and Pizza Hut has 6000 US outlets and about as many again in 90 countries. Unlike Little Chef, both companies took to franchising in a big way.

So where did Little Chef go wrong? In my opinion it’s simple really: they dominated the market for roadside eating in another era, but they stopped evolving as things changed around them. Since then the distribution, density, variety and quality of the food we eat on the move have changed dramatically. Unfortunately, for many years, Little Chef didn’t change at all. Perhaps there was a clever strategy to use it as a cash cow as it deteriorated, but it soon got to the stage where the brand became somewhat tarnished. What appeared to be gold was just gold plated after all.

I haven’t had one of Heston’s Little Chef meals. But, no matter how good they are, the brand has an almost impossible task: to reinvent itself and compete on ubiquity, location, consistency, quality and value for money – the prerequisites of the big branded food outlets today. There are several less risky franchises to buy if they, belatedly, attempt to copy IHOP and the like.

Unfortunately, there just isn’t room for a smaller Little Chef in today’s mega-brand-oriented world. My guess is that, one day soon, the Little Chef brand will become so small it will just disappear, as if a frustrated alchemist had waved a magic wand.

Mark

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