SONIC Boom: How the classic drive-in chain is adapting to the times

It’s tough stuff to stay true to your roots while adapting to the times.

we0310That is precisely the feat that SONIC Drive-In is trying to accomplish in its continued expansion from a regional darling to a national powerhouse. Certainly, such evolution has been successfully done before—just look at once-regional upstarts such as Chick-fil-A and Chipotle. But the formula for national success is not simple.

In fact, there is no formula.

That’s making life particularly interesting for John Budd, executive vice president and chief development and strategy officer at SONIC, who is overseeing the company’s brand evolution. On one hand, Budd wants SONIC to remain the same folksy but slightly off-kilter drive-in fast-food chain that made it a regional standout from its base in Oklahoma City. But on the other hand, as SONIC continues its expansion outside the South and into the Northeast and beyond, some key changes have had to be accommodated at new locations.

For example, winter weather can get nasty in the north. That’s why the chain, famous for its drive-in service and friendly carhops, is installing drive-thrus or dining rooms—or both—in many of its new stores.

This is not your grandfather’s SONIC. But, Budd says, it doesn’t exactly have to be.

“The drive-in is still at the center of the brand. But we do have to make format adaptations to make sure the brand plugs into the real estate in cooler markets.”

Even then, he insists, SONIC needs to “capture the brand essence regardless of the format.” In other words, SONIC needs to first and foremost be the place that offers more than 1.3 million different drink combos, sells burgers at breakfast, and dishes outside-the-box milkshakes like its new Creamery Shakes, which come in such oddball flavors as Bourbon Brown Sugar and Wildberry & Lavender.

At stake for SONIC is nothing smaller than its sea-to-sea future. There are 3,529 SONIC Drive-Ins in 45 states today, with Rhode Island the most recent state to welcome a location. That means there are just five states to go.

In 2014, the brand announced plans to build as many as 1,000 new stores over 10 years. While it’s strayed slightly downward from that track, SONIC still plans to add about 60 new stores over 2016 and, in the process, continue entering the digital age of fast food with everything from new point-of-sale systems and menuboards to LED lighting at stores and continued expansion of its social marketing into the worlds of Snapchat, Instagram and whatever is the next cool click.

One analyst says SONIC has the advantage of keeping ahead of the competitive pack.

“SONIC is the most innovative [quick serve] that we’ve seen,” says Will Slabaugh, managing director of Stephens Research, a financial services firm. “The heart and soul is the drive-in. But SONIC is identifiable in any format.”

As SONIC grows, the innovation seems to grow along with it. Since recently launching boneless chicken wings, chicken has broadened from 5 percent to 10 percent of SONIC sales, Budd says. And by adding the new shake line, it’s extended its shake offerings to 25 flavors. Meanwhile, its limited-time offers (like the most recent Ultimate Chicken Club) remain the envy of the industry.

But the key to SONIC’s successful expansion will be its continued appeal to Millennials, Budd says.

“Millennials are the generation that above and beyond … want to have products customized and personalized for them,” he says.

As SONIC expands, it’s looking for ways to improve. It’s upgrading its POS equipment to a cloud-based system, installing new digital menu screens in all drive-in stalls, installing LED lighting and even testing solar panels at a company-owned store in San Antonio that draws in curious customers who want to take a closer look at the panels hoisted on canopies above the parking stalls.

Even the marketing—widely viewed among the strongest in fast food—is getting a tweak. Basketball superstar Kevin Durant joined the familiar “Two Guys” in an offbeat ad campaign. While there are no plans to add more celebs, Budd doesn’t rule it out.

“We’re taking the old service model and trying to modernize it,” he says.

Original article

The Home Team: Two Oklahoma City companies partner on co-branded locations

Two Oklahoma City brands, Love’s and Sonic, are teaming up to open joint locations.

Screen Shot 2016-04-13 at 11.17.49 AMThe new Sonic restaurants inside Love’s Travel Stops represent a new format for the Oklahoma City drive-in chain. The co-branded stores have the traditional drive-up dining stalls, as well as an indoor restaurant dining area and a drive-thru.

Love’s inherited two co-branded locations after acquiring Travel Stops that already had Sonic locations in them — in Hinton and in Memphis, Texas. Now the two companies have joined to expand the co-branded concept.

The first new Sonic/Love’s location opened Jan. 28 in Holcomb, Kan., and a second co-branded store is expected to open March 17 in Scott City, Kan.

Love’s hopes to eventually open more co-branded locations in Oklahoma, said Kealey Dorian, a spokeswoman for Love’s.

“We do have several more that are in the works,” Dorian said. “We are looking at Oklahoma. That’s something we would both aspire to.”

Love’s has more than 370 Travel Stops in 40 states and partners with 18 quick-service restaurant brands.
Screen Shot 2016-04-13 at 11.17.37 AM

The company tries to choose concepts that can compete well and offer something new in the community, Dorian said.

The new Sonic restaurants at the Love’s stores are operated by local Sonic franchisees.

The co-branded restaurants offer the complete Sonic menu. The Holcomb restaurant is doing quite well, said John Budd, Sonic’s executive vice president, chief development and strategy officer.

Sonic is in “expansion mode” and partnering with Love’s was a good way for the company to bring its brand to smaller communities, Budd said.

“We saw some opportunities to join the synergy of both brands and open these new locations,” Budd said.

Original Article

Sonic Drive-In testing solar power in San Antonio

America’s Drive-In is going green, and the Alamo City has become the company’s official testing ground for rooftop solar power.

Screen Shot 2016-04-13 at 11.24.51 AM

Work crews recently installed 90 solar panels on the roofs of three covered ordering areas at the Sonic Drive-In off DeZavala Road and Interstate 10.

Barely noticeable to the casual passer by, Sonic officials flipped the switch earlier this month, making the solar panels live and fully operational.

Sonic Corp.’s Senior Director of Facilities Wayne Brayton said the company will be watching the panels’ performance closely.

“We’re very excited to see what the results are,” Brayton said. “We have some estimates of what we’re going to save, but we’re going to be tracking it for the next six months or so to see how it compares to last year’s light bills.”

While a Sonic franchise owner in Oregon is already using solar panels to save $4,500 per year on that location’s light bill, the DeZavala restaurant is the first corporate-owned location to use rooftop solar.

Brayton said the average Sonic restaurant uses $2,000 per month in electricity and that the solar panels are expected to save up to $400 per month.

“We’ll test it here for a few months to see how it goes and then share our findings with our franchisees and see if we can’t get some of them to sign on as well,” Brayton said.

sonic-solar-2-750xx326-183-0-0Brayton said San Antonio was chosen as a test market due to rooftop solar rebates that provided an attractive price point.

While the federal government offers a 30 percent tax credit for rooftop solar, Brayton said CPS Energy, San Antonio’s municipally owned utility company, further sweetened the deal by providing an additional 50 percent rebate through a 2015 program.

Working from a list of local companies authorized by CPS Energy, Sonic chose One80 Solar as its rooftop solar installer.

Brayton said Sonic is expected to receive about $38,000 through the CPS Energy rebate alone.

“It was a good opportunity for us to try the solar panel system and save a few dollars on the install and the electric bill,” Brayton said.

Original Article

Sonic Aligns Leadership for Digital Success

Executive promotions reflect growing emphasis on technology

OKLAHOMA CITY–(BUSINESS WIRE)– Sonic Corp. (NASDAQ:SONC), the nation’s largest chain of drive-in restaurants, today announced a new leadership alignment that reflects the increased integration of technology across functions and initiatives.

Appointed as president is Todd Smith, currently the brand’s chief marketing officer. With his promotion, Smith continues to serve as chief marketer for the brand, including advertising, digital consumer communications, product innovation, consumer insights and customer relationship management (CRM). Retail technology architecture and brand technology systems will now report to Smith, reflecting the integration between digital communications and CRM initiatives and the technology that powers them.

Smith joined Sonic in 2012 as vice president of marketing. Under his leadership, Sonic launched a variety of new products, including candy slushes and boneless wings, while signing the brand’s first athlete spokesperson, 2014 National Basketball Association MVP, Kevin Durant. Sonic’s proprietary digital menu technology has grown and evolved with Smith’s continued emphasis on digital communications.

Also, John Budd was promoted to executive vice president and continues to serve the brand as chief development and strategy officer. Leading the implementation of key in-store retail technologies at more than 3,500 drive-ins, Budd also assumes leadership for technology support with his promotion. Budd joined Sonic in 2013 to lead the strategy and development functions and has added supply chain as well as new point-of-sale and other technology implementation over the past two years to his Sonic portfolio.

“Technology permeates every aspect of our business,” said Cliff Hudson, Sonic CEO. “No longer can the technology organization exist in one group, and our re-alignment today signifies the realities of technology design, testing and implementation as a critical part of many key functions of the business.

“We believe that housing specific technology functions with the core business units supported by the technology will allow us to bring consumer-facing technology to market more quickly, and internally support our franchisees as they implement technology at the drive-in. I have the utmost confidence in Todd and John as they lead their respective teams and propel the brand forward.”

Also promoted to vice president and chief accounting officer is Michelle Britten, previously serving as vice president and controller. Britten has served Sonic in a variety of accounting roles since joining Sonic in 2005 as director of SEC reporting. She is responsible for all accounting and financial reporting functions, developing internal controls and coordinating the annual audit.

About SONIC, America’s Drive-In

SONIC, America’s Drive-In is the nation’s largest drive-in restaurant chain serving more than 3 million customers every day. Nearly 90 percent of SONIC’s 3,500 drive-in locations are owned and operated by local business men and women. Over the past 60 years, SONIC has delighted guests with signature menu items, more than 1.3 million drink combinations and friendly service by iconic Carhops. To learn more about Sonic Corp. (NASDAQ/NM:SONC), please visit sonicdrivein.com or follow us on Facebook and Twitter.

SONC-F
View source version on businesswire.com: http://www.businesswire.com/news/home/20160129005844/en/

Sonic Corp.
Christi Woodworth, 405-225-5600
Vice President of Public Relations

Source: Sonic Corp.

News Provided by Acquire Media

Original Article

PRESS RELEASE: CORRECTING and REPLACING CAPTION SONIC Continues California Expansion with 33 New Planned Drive-Ins

This Smart News Release features multimedia. View the full release here:
http://www.businesswire.com/news/home/20160104005151/en/
The release reads:

Growing brand still seeking interested franchisees in prime California markets

OKLAHOMA CITY–(BUSINESS WIRE)– SONIC® Drive-In (NASDAQ: SONC) today announced the expansion of two existing franchise agreements and the addition of two new franchise agreements for a total of 33 new drive-ins to the state of California over the next seven years. The new California drive-ins will be located in the regions of Los Angeles, Palm Springs, Central Valley and Northern California including Sacramento and the Bay Area. Beyond this planned expansion, the SONIC development team is actively seeking additional franchisees in California.

sonic_0034_1000px
SONIC Continues California Expansion with 33 New Planned Drive-Ins (Photo: Business Wire)

The 33 drive-ins are planned for multiple markets across the state: 11 in Sacramento; 12 in the San Francisco Bay Area; three in west Los Angeles; five between Bakersfield and Stockton and two in the Palm Springs area. All planned drive-ins should be serving customers by 2022, bringing more than 1,500 new jobs to the state over seven years. There are currently 68 open drive-ins operating in California, and this announcement brings the total of upcoming drive-ins to 101.

“As a franchise-centric brand with more than 60 years of heritage, SONIC is a smart choice for motivated entrepreneurs interested in building a business with an established, respected brand,” said John Budd, chief development and strategy officer for SONIC. “These new and existing partners in California represent some of the best in the business, with a great deal of restaurant and multi-unit experience. As we continue to seek qualified partners for the SONIC brand and in the state, these franchisees will exemplify the kind of success that comes from bringing SONIC Drive-In to previously underserved markets.”

Pacific Drive-Ins, led by Max Gelwix and Kasey Suryan, an existing and successful franchise group with multiple drive-ins in California already, signed on for 14 additional locations, expanding their footprint in Los Angeles and Sacramento over the next few years. Recent grand openings in Riverside, Calif., and San Diego were instant hits, and the ongoing success of their 10 other drive-ins led them to expand their footprint in California.

Scott McMillan, a current SONIC franchisee with 20 years of experience with the brand, signed an agreement to bring five new drive-ins to the Central Valley region, including Bakersfield, Calif., and Stockton, Calif., in the next five years. McMillan already operates 26 drive-ins in Bakersfield, Fresno and Sacramento. As a tenured and respected franchisee within the organization, McMillan has served on the SONIC Franchise Advisory Council and continues to play an integral role in brand leadership.

New franchisee Arthur D’Souza is planning two drive-ins over the next three years in the Palm Springs area, with the first location planned for Indio, Calif. D’Souza is an award winning franchisee in other systems and brings a strong connection to the Palm Springs market.

Charanjiv Dhaliwal, a new SONIC franchisee with franchise group Norcal Cajun Foods Inc., signed 12 new commitments in the North and East San Francisco Bay areas. Norcal Cajun Foods Inc. are experienced developers and restauranteurs for Popeye’s, ARCO, Twin Peaks and Black Bear Diner, who are looking to increase SONIC’s brand presence in the Northern California market.

“The expanding presence of the SONIC brand in California has been quite a success story in the past few years,” said Drew Ritger, senior vice president of development for SONIC. “The consumer demand – fueled by our national marketing campaign and the Two Guys commercials – is extremely strong in the state, and many franchise opportunities still exist for new and existing partners in Sacramento, the East Bay Area, west Lost Angeles and the Santa Barbara and Ventura counties.”

Individuals interested in pursuing a SONIC franchise are encouraged to visit sonicfranchises.com for more information on
qualifications and brand support. To schedule an in-person Franchise Discovery meeting, email sonicfranchises@sonicdrivein.com or call 1.800.569.6656.

Always a drive-in at heart, SONIC is ready to work with franchisees to find a building solution to match their needs and the needs of guests. SONIC is a franchise-centric organization with multiple long-term and legacy franchisees offering an unparalleled level of support at every stage of development. SONIC offers franchisees flexibility with multiple drive-in formats, including: the traditional drive-in model with dining stalls and a drive-thru; conversions, renovating existing restaurant buildings to create unique drive-ins; the counter service model, offering customizable footprints to fit a variety of spaces; and indoor dining formats that allow guests to experience SONIC in multiple ways – either in their cars, at the drivethru or seated at a table inside.

About SONIC, America’s Drive-In

SONIC, America’s Drive-In is the nation’s largest drive-in restaurant chain serving more than 3 million customers every day. Nearly 90 percent of SONIC’s 3,500 drive-in locations are owned and operated by local business men and women. Over more than 60 years, SONIC has delighted guests with signature menu items, more than 1.3 million drink combinations and friendly service by iconic Carhops. Since the 2009 launch of SONIC’s Limeades for Learning philanthropic campaign in partnership with DonorsChoose.org, SONIC has donated more than $5 million to public school teachers nationwide to fund essential learning materials and innovative teaching resources to inspire creativity and learning in today’s youth. To learn more about Sonic Corp. (NASDAQ/NM: SONC), please visit sonicdrivein.com and please visit or follow us on Facebook and Twitter. To learn more about SONIC’s Limeades for Learning initiative, please visit Limeadesforlearning.com.

SONC-D
View source version on businesswire.com: http://www.businesswire.com/news/home/20160104005151/en/
SONIC Drive-In
Madison LaRoche, <a href=”tel:512-542-2842″>512-542-2842</a>
Media Contact for SONIC
<a href=”mailto: Madison.LaRoche@cohnwolfe.com”>Madison.LaRoche@cohnwolfe.com</a>
or
Christi Woodworth,<a href=”tel: 405-225-5602″>405-225-5602</a>
Vice President, Public Relations for SONIC
<a href=”mailto:Christi.Woodworth@sonicdrivein.com”>Christi.Woodworth@sonicdrivein.com</a>
Source: SONIC Drive-In
News Provided by Acquire Media

SONIC Continues California Expansion with 33 New Planned Drive-Ins

Growing brand still seeking interested franchisees in prime California markets

sonic_0034_1000px
SONIC Continues California Expansion with 33 New Planned Drive-Ins (Photo: Business Wire)

SONIC® Drive-In (NASDAQ: SONC) today announced the expansion of two existing franchise agreements and the addition of two new franchise agreements for a total of 33 new drive-ins to the state of California over the next seven years. The new California drive-ins will be located in the regions of Los Angeles, Palm Springs, Central Valley and Northern California including Sacramento and the Bay Area. Beyond this planned expansion, the SONIC development team is actively seeking additional franchisees in California.

The 33 drive-ins are planned for multiple markets across the state: 11 in Sacramento; 12 in the San Francisco Bay Area; three in west Los Angeles; five between Bakersfield and Stockton and two in the Palm Springs area. All planned drive-ins should be serving customers by 2022, bringing more than 1,500 new jobs to the state over seven years. There are currently 68 open drive-ins operating in California, and this announcement brings the total of upcoming drive-ins to 101.

“As a franchise-centric brand with more than 60 years of heritage, SONIC is a smart choice for motivated entrepreneurs interested in building a business with an established, respected brand,” said John Budd, chief development and strategy officer for SONIC. “These new and existing partners in California represent some of the best in the business, with a great deal of restaurant and multi-unit experience. As we continue to seek qualified partners for the SONIC brand and in the state, these franchisees will exemplify the kind of success that comes from bringing SONIC Drive-In to previously underserved markets.”

Pacific Drive-Ins, led by Max Gelwix and Kasey Suryan, an existing and successful franchise group with multiple drive-ins in California already, signed on for 14 additional locations, expanding their footprint in Los Angeles and Sacramento over the next few years. Recent grand openings in Riverside, Calif., and San Diego were instant hits, and the ongoing success of their 10 other drive-ins led them to expand their footprint in California.

Scott McMillan, a current SONIC franchisee with 20 years of experience with the brand, signed an agreement to bring five new drive-ins to the Central Valley region, including Bakersfield, Calif., and Stockton, Calif., in the next five years. McMillan already operates 26 drive-ins in Bakersfield, Fresno and Sacramento. As a tenured and respected franchisee within the organization, McMillan has served on the SONIC Franchise Advisory Council and continues to play an integral role in brand leadership.

New franchisee Arthur D’Souza is planning two drive-ins over the next three years in the Palm Springs area, with the first location planned for Indio, Calif. D’Souza is an award winning franchisee in other systems and brings a strong connection to the Palm Springs market.

Charanjiv Dhaliwal, a new SONIC franchisee with franchise group Norcal Cajun Foods Inc., signed 12 new commitments in the North and East San Francisco Bay areas. Norcal Cajun Foods Inc. are experienced developers and restauranteurs for Popeye’s, ARCO, Twin Peaks and Black Bear Diner, who are looking to increase SONIC’s brand presence in the Northern California market.

“The expanding presence of the SONIC brand in California has been quite a success story in the past few years,” said Drew Ritger, senior vice president of development for SONIC. “The consumer demand – fueled by our national marketing campaign and the Two Guys commercials – is extremely strong in the state, and many franchise opportunities still exist for new and existing partners in Sacramento, the East Bay Area, west Lost Angeles and the Santa Barbara and Ventura counties.”

Individuals interested in pursuing a SONIC franchise are encouraged to visit sonicfranchises.com for more information on qualifications and brand support. To schedule an in-person Franchise Discovery meeting, email sonicfranchises@sonicdrivein.com or call 1.800.569.6656.

Always a drive-in at heart, SONIC is ready to work with franchisees to find a building solution to match their needs and the needs of guests. SONIC is a franchise-centric organization with multiple long-term and legacy franchisees offering an unparalleled level of support at every stage of development. SONIC offers franchisees flexibility with multiple drive-in formats, including: the traditional drive-in model with dining stalls and a drive-thru; conversions, renovating existing restaurant buildings to create unique drive-ins; the counter service model, offering customizable footprints to fit a variety of spaces; and indoor dining formats that allow guests to experience SONIC in multiple ways – either in their cars, at the drive-thru or seated at a table inside.

About SONIC, America’s Drive-In

SONIC, America’s Drive-In is the nation’s largest drive-in restaurant chain serving more than 3 million customers every day. Nearly 90 percent of SONIC’s 3,500 drive-in locations are owned and operated by local business men and women. Over more than 60 years, SONIC has delighted guests with signature menu items, more than 1.3 million drink combinations and friendly service by iconic Carhops. Since the 2009 launch of SONIC’s Limeades for Learning philanthropic campaign in partnership with DonorsChoose.org, SONIC has donated more than $5 million to public school teachers nationwide to fund essential learning materials and innovative teaching resources to inspire creativity and learning in today’s youth. To learn more about Sonic Corp. (NASDAQ/NM: SONC), please visit sonicdrivein.com and please visit or follow us on Facebook and Twitter. To learn more about SONIC’s Limeades for Learning initiative, please visit Limeadesforlearning.com.

SONC-D

View source version on businesswire.com: http://www.businesswire.com/news/home/20160104005151/en/

SONIC Drive-In
Madison LaRoche, 512-542-2842
Media Contact for SONIC
Madison.LaRoche@cohnwolfe.com
or
Christi Woodworth, 405-225-5602
Vice President, Public Relations for SONIC
Christi.Woodworth@sonicdrivein.com

Source: SONIC Drive-In

News Provided by Acquire Media

Original Article

Sonic ramps up conversion development

Repurposed sites save costs for drive-in operator

img20151119190604420Sonic Corp. has ramped up its conversions of other commercial locations in the past year, taking advantage of both time and money savings and the ability to get high-traffic locations.

The Oklahoma City-based drive-in operator has converted former quick-service and casual-dining locations, as well as banks, Andrew “Drew” Ritger Jr., Sonic senior vice president of development, told Nation’s Restaurant News.

“You can have lower investment cost and a faster construction cycle,” Ritger said.

Conversions can shave as much as 120 days off a typical Sonic unit’s  development schedule, as well as save on the cost, he explained.

The conversions have been especially useful in the expensive real estate markets of California and the Northeast, he said.

“As we expand, we found there was an opportunity to repurpose other restaurant locations,” Ritger said. “Many times, they are on great real estate, but they had run into some conditions like the operator of the other concept got into some financial trouble or the license term or contract had ended and weren’t renewed.”

In California, Sonic has repurposed Burger King and Wendy’s restaurants. In New York, it has reconfigured former Wendy’s and Perkins Restaurant & Bakery locations. In New Jersey and New York, it has remodeled former bank buildings. And it has converted a Wendy’s unit in South Carolina and a KFC location in Cleveland.

Conversions offer a number of advantages, Ritger said. “Most of the locations already have the right conditional-use and drive-thru permits,” he said. “These are things that save the franchisee time and money.”

The largest restaurant in Sonic’s system is now in Cheektowaga, N.Y., a suburb of Buffalo, which opened November, 2015 in a converted Perkins location. It covers 5,000 square feet and seats about 80 people, and business has been brisk since the opening, Ritger said. The larger dining rooms can also provide Sonic’s signature roller-skating waiter service, he said.

Conversions allow Sonic to add patios, parking stalls and dining rooms in some areas, as well as let the brand make regional modifications. Several repurposed restaurants in California, for example, have garage-style doors so the dining room can be opened to the patio in temperate weather, he said.

“It can really speed the time it takes to go from concept to opening on project,” Ritger said. In addition, franchisees can see savings in soft costs in architectural in engineering planning, as well as in legal fees for licenses and permits.

“What we normally do is take the shell of the building, and then we convert it to our kitchen layout,” Ritger said. “Our kitchen designs can be put into just about every concept. Occasionally we have extra space for employee lockers or meeting rooms. “

The conversion format began about two years in Childress, Texas, he said, and continues “if we get a good opportunity in any location.”

Other states that have seen Sonic repurpose other restaurant locations include Alabama, Connecticut, Florida and Rhode Island. “It depends on what the opportunity is and if the franchisee believes its good real estate and a good business opportunity,” Ritger said.

The ramped up conversions also allow franchisees to accommodate increasing real estate costs, he said. “With the real estate market having a significant recovery since 2009 and 2010, conversions have offered a nice opportunity to purchase or lease real estate,” Ritger said. “Post-recession, there are number of opportunities that have come up.”

Cost savings depend significantly on site inspections, he added, and some sites will not fit into the economic model. “You have to do very good due diligence on your site inspection by your engineering and construction team, with the franchisee,” he said.

As of Aug. 31, 2015, Sonic had 3,526 drive-ins in 44 states.

Contact Ron Ruggless at Ronald.Ruggless@Penton.com.
Follow him on Twitter: @RonRuggless

Original Article