Newspaper article THE JOURNAL RECORD

But Hold the Discounts, Please Sonic's Decision to Place Service over Price Cuts Satisfies Appetites on Wall Street

Newspaper article THE JOURNAL RECORD

But Hold the Discounts, Please Sonic's Decision to Place Service over Price Cuts Satisfies Appetites on Wall Street

Article excerpt

Curbside service is no less popular now than it was 43 years ago when the Top Hat Drive-in, later to become Sonic Drive-in, opened its doors in Shawnee.

A smiling carhop still is the logo of the publicly held Sonic Drive-in chain that has more than 1,543 "quick service" franchise and company-owned restaurants operating in 27 sunbelt states across the nation.

And that Sonic service goes beyond just carhop delivery to the curb, according to J. Clifford Hudson, president and chief executive officer of Oklahoma City-based Sonic Corp., now the world's fifth- largest hamburger chain.

"When you go to Sonic, if you want chili and cheese on your tater tots, we'll give it to you that way," Hudson said.

"If you pulled into most of our competitors, hopefully they would tell you to go to Sonic, but more likely they would just say they couldn't help you. So, not only is the menu different, but the level of service is different at Sonic."

The combination appears to be working well: The chain is growing at the rate of one new store opening every three days, and its earnings and demand for its stock continue to grow.

There is a gradual shift in the mix of Sonic Drive-in restaurants with the growth of company-owned restaurants, but the company is -- and will remain, Hudson noted -- about 85 percent franchise driven.

Still, Sonic increased its commitment to franchise operations by adding a new vice president to head franchise sales as part of its 1994 management reorganization.

"We plan about 85 new franchise drive-ins this year and more than 30 new company-owned," Hudson said.

"We had 138 company stores in August 1994. We now have 233 company stores. That's a 75 percent increase in two years."

Business increased last year and appears headed that way in fiscal 1996. The only changes planned for Sonic, in fact, are to refine and improve methods of business, Hudson said.

To that end, the chain has developed an instant operations review system to improve the daily management end of the business in its company-owned stores. …

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