It seems like fans of two major restaurant chains will soon have the best of both worlds.
Applebee’s and IHOP are joining forces to open up dual-branded locations in the U.S. after eight prototypes of the concept were opened in international markets, according to a recent earnings call from Dine Brands Global, the parent company of both restaurant chains.
“We just opened the eighth dual-brand restaurant in Leone, Mexico, outside Mexico City,” said Dine Brands Global CEO John Peyton during the call. “You know, the concept there is a shared back of house and a combined and blended front of house for the two brands."
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Peyton also claimed that revenues for the dual-branded locations are “two times or more” than what it was before when the brands had separate locations.
“What we are seeing on average is that the revenues for the same size box as one brand or the other is two times or more what it was before, what you would expect, because with the two brands, we can address all four day parts and that is a big innovation that we are nurturing overseas and that our intent is to eventually bring to the U.S. when we find the right opportunity to introduce it,” said Peyton during the call.
While speaking with Nation’s Restaurant News, Peyton also revealed that the dual-branded locations even offer more seating to customers looking to eat at either restaurant.
“At breakfast, when there are more IHOP customers, customers can be seated in the Applebee’s area and vice versa at dinner,” said Peyton.
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The move from Dine Brands Global is a page out of Dunkin’ Brands’ book when it started opening new stores sometime between 2013 and 2015 that combined their Dunkin’ Donuts and Baskin-Robbins brands into dual-branded locations.
The plan to expand the idea of putting Applebee’s and IHOP under one roof also comes amid Dine Brands Global's battle with declining revenue. In Dine Brands Global’s fourth-quarter earnings report, which was released on Feb. 28, the company revealed that total revenues for 2023 was $831.1 million, which is a decrease from the $909.4 million it earned in 2022.
The company claims in the report that the decline in revenue “was primarily due to the refranchising of the 69 company-operated Applebee’s units in October 2022.”
In the fourth quarter of 2023 alone, Applebee’s faced declining sales. The restaurant’s year-over-year comparable same-restaurant sales decreased by 0.5%.
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