Gourmet Burger Chain Strikes Franchise Deal to Fatten Its National Footprint
Fatburger is taking on Texas in a big way in its quest to spread across the U.S. beyond its California roots.
The Beverly Hills, California–based burger chain owned by FAT Brands announced it has struck a deal with Dallas-based Croft Ventures to develop 25 Fatburger locations in Texas. The chain said the first Fatburger stores would open in Dallas, Houston, San Antonio and Austin.
This deal follows one announced in April with the Grand Prairie, Texas-based Ever Suite Group for three locations in the Dallas-Fort Worth area that will co-brand Fatburger with sister brand Buffalo’s Express.
The nearly 70-year-old chain that dubs itself “The Last Great Hamburger Stand” is attempting to beef up in a highly competitive burger business. Fatburger boasts homemade, gourmet and custom-built sandwiches. But so do others such as Five Guys, Culver’s and rapidly expanding Shake Shake.
Fast food stalwarts McDonald’s, Burger King and Wendy’s remain king, taking the top three spots on QSR magazine's burger segment list.
To further its push into the burger wars, FAT Brands recently paid $10 million for Falls Church, Virginia-based Elevation Burger, a fast-casual franchise that sells burgers made with organic, free-range, grass-fed beef. It has 44 locations in the U.S. and Middle East. Plans are to expand that chain as well.
According Fatburger’s website, it has 77 Fatburger locations, most of them in California. A company spokeswoman said there are 200 or more in various stages of development.
In an earnings call in April, Andy Wiederhorn, FAT Brands CEO, said the company has a robust backlog of opportunities and “we expect this pipeline to fuel even greater expansion in 2020.”
The Fatburger chain typically looks for locations offering 1,500-2,300 square feet of space and prefers leases for a minimum of five years with four five-year options. It seeks to be near retailers such as Target, Home Depot and Costco in high-density residential areas and town centers.
