Why Fuddruckers days may be numbered

Howdy folks, and welcome back to Houston Historic Retail. Today, we’re taking time for a sad topic: the slow and agonizing death of Fuddruckers. The downfall of Fudds is not new content here on HHR. My first hint that something was seriously wrong at the chain goes all the way back to 2018 and the failure of the chain to re-franchise a popular West Houston location before shutting it down. My naivety of the conditions of Luby’s Fuddruckers at the time led me to believe that Fudd’s may have stood a chance if they could pare down locations and focus on value. Looking back at financial reports from 2019, however, paints a very grim picture for Fuddruckers. Sales were down 5.5% from 2018 to 2019, a very troublesome number for a quick-service hamburger chain when its sibling, a cafeteria, was only experiencing a 3.2% drop in traffic, likely associated with the number of blue hairs who frequent the chain diminishing. A recent video by YouTube sensation The Company Man provides a good summation of how Fuddruckers ended up in the hands of Luby’s. The Company Man’s perspective is that the acquisition by Luby’s was an attempt to bolster both brands by building co-located operations. I would, however, like to clarify that while these locations shared property, they were not combined, and the concept mentioned of the Fuddruckers kids eat free deal being offered to Luby’s customers did not occur as far as I know. Under Luby’s ownership, some odd tests would occur, like a Luby’s being converted to a Fuddruckers to utilize the existing drive-thru, the conversion of most Cheeseburger in Paradise locations to a concept named Fuddruckers Deluxe (which featured sit-down operations), and eventually the expansion of Fuddruckers into existing former fast food restaurants. In retrospect, this doesn’t reflect a stable company looking to leverage growth. Rather, it seems like a few valiant, if a bit last-ditch, efforts at increasing the popularity of Fuddruckers.

After Luby’s announced their liquidation in 2020, the future owner of Fuddruckers took the first steps to take on the new role. Nicholas Perkins, the owner of Black Titan Industries, signed an agreement with Luby’s to pick up 13 formerly company-owned Fuddruckers locations, immediately making him the largest franchisee in the system. Perkin’s experience before this seems mostly to be with food service contracting. Operating things like commissaries in colleges and hospitals, which likely put him on Luby’s radar. A few months after picking up the first 13 locations, Black Titan stepped up again, this time to purchase the corporate structure of Fuddruckers and a bulk of the remaining locations. Black Titan’s initial plans for Fuddruckers called for an attempt to rebuild the brand. One of the first big steps was the announcement of 10 new locations to be placed in mall food courts throughout the U.S. According to a few former employees who reached out, Perkin’s plan for Fudds was positive and mostly seemed attainable. Overall, the chain continued operating much as it had for years, with a compact footprint. A fire at the Willowbrook Mall Fuddruckers was one of the first oddities under the new ownership. While it’s not fair to blame this on anyone, it certainly did not bode well, and recovering from this has likely stretched resources thin. The next issue would be the presumed cancellation of the Mall Food Court Fuddruckers. While confirmation of cancellation is only coming from Willowbrook Mall at this time, with no news other than the initial announcement and questions from other malls going unanswered, it’s fair to assume this plan has been dropped or is at least on hold.

While these circumstances weren’t great, it did seem like Fuddruckers would still be able to make it… until it didn’t. On February 5th, I visited a Fuddruckers for a “Sunday Lunch” Facebook post. What I found was quite shocking: a restaurant run by maybe three employees, nearly no soda options, and seemingly lower-quality ingredients. Researching this after visiting the location, I found that Fuddruckers was involved in a lawsuit with one of their suppliers, which was never a good sign, and that locations outside of Houston had started to close. At this point, it became obvious that Fudds may not survive. I began doing monthly checkups and saw disturbing things in reviews, like locations that had dropped potato wedges for fries, bad food, soda, and shakes out everywhere, and the removal of credit card processing systems from certain locations. This Creekside Fuddruckers, one of the newest in the chain, quietly bit the dust just about two weeks ago. These issues all point to cash flow problems with Black Titan. Further proof of this would be my visit to Houston’s only franchised Fuddruckers, Town & Country, where it was business as usual just over a week ago. The future of Fudds as a brand is not clear. It could very well end up in Broken Chain territory, with someone stepping in to purchase the naming rights, which still bring in cash from overseas and dissolving franchisee control in the U.S. Or we could see the end of the brand altogether with the remaining franchised locations forced to close. However, this is purely speculation at this point, and we’ll have to wait and see.