Huddle House’s Recipe for Growth

In this Salute to American Success, we’re taking a look at Huddle House, a restaurant chain found mainly in the Southern United States. The company features many 24-hour diner-type restaurants, specializing in Southern-style dishes. It was founded in 1964 by restaurateur John Sparks.

“Mr. Sparks hatched the idea for Huddle House as a way to bring friends and family together after football games on Friday Nights,” said Huddle House CEO Michael Abt. “It started as one restaurant that [the Sparks] owned and operated themselves.”

Today, the company has 357 franchise locations that are represented by about 165 franchise partners, with each partner owning an average of two locations, according to Abt. Huddle House itself has 10 company-operated locations.

One of the biggest struggles the business faced was the Great Recession.

“Around 2008-2009 we saw a tremendous transaction decline,” Abt said. “Restaurants are in small rural towns of United States … most of the disposable income of residents dried up.”

Despite the brief bump in the road, Abt says the company has rebounded successfully, and is currently planning to open multiple locations in Virginia and one in New Jersey (which would become the northern-most location).

“We’re growing north of 7% per year,” he said. “Same-store sales have been positive for 17-straight months … the transaction trend has improved 2.3% over the prior year.”

Abt says part of the reason for the company’s continued growth is its extensive training program and support for each franchise opening.

“We send five trainers to the restaurant two weeks before opening,” said Abt. “They help hire and train team members. Prior to that, we have the franchise partner or key operator train at a five-week management program. We keep trainers in the restaurant for a week… to help to ensure success of new opening.”

With an increasing amount of people following health-conscious diets and the healthy eating trend catching on at restaurants across the nation, the Huddle House CEO said he isn’t too concerned that it will impact the business.

“We don’t ignore fact that people want or should eat healthy… but we know what Huddle House means to core customers, so we serve them what they want,” Abt said.

Abt said anyone looking to open a business today should not only plan for the present, but for the future as well.

“Do your research… see what’s happening with consumer trends,” he said. “What’s hot today may not be in five years.”

The company, which was sold to a private firm in 1994, was most recently acquired by Sentinel Capital Partners in 2012.