NASCAR's favorite burger joint plans 20 Las Vegas stores

Checkers franchise owner will face stiff competition in war for the local burger buyer
BY VALERIE MILLER

Burger King, McDonald's, Sonic and gobs of other fast food offerings fill bellies throughout the valley everyday. Now, locals will have one more choice to satisfy their burger-and-fries cravings.

Checkers Drive-In Restaurants announced plans recently to open 20 area stores throughout the next four years. The Las Vegas expansion is part of the Tampa, Fla.-based chain's efforts to move west. It already has California operations in Fresno and Orange County.

The first franchise development agreement was made with David Meldrum and Nick Nasrollahi, who spent 20 years with the Jack in the Box organization. Nasrollahi says he plans to own and operate all 20 of the local franchises, as opposed to subfranchising out the territory as some franchise owners do.

"I intend to open seven to 10 by the end of 2008, and 10 to 12 by the end of 2009. After that, it will probably be two to three per year," he said. "Within four years, I would like to have the 20 (stores) done. That's the target."

North Las Vegas will likely be the site of the first Checkers, he said. The company is considering other locations for building the signature checkered modular restaurants. General ground leases will be signed with shopping centers for most locations.

"We will be opening restaurants throughout the valley," he said.

Nasrollahi predicted "great hamburgers" and Checkers' specialty pies will be hot sellers, drawing people to the quick eateries. Checkers' typical store model has two drive-throughs and an outdoor patio for customers. The franchisee said the double drive-throughs will set the chain apart, even if a few vintage McDonald's have such a feature.

Major competition will come from Sonic, Jack in the Box, and McDonald's, as well as Burger King, In-N-Out Burger and Carl's Jr., Nasrollahi believes. The prices will be competitive, however, he said. They will fall in between the pack. The average burger combo meal will run about $5.

Nasrollahi said his goal is to be competitive and offer better quality, but franchise costs aren't cheap. The initial franchise fee is $30,000. The modular building and equipment costs run in the "low $300,000s," said Ron Levondosky, the executive vice president of franchise operations at Checkers Drive-In Restaurants. Another 4 percent of annual net sales is paid back to the owners of the Checkers name.

Each restaurant will have 25 to 40 employees. The restaurants are smaller is size, at about 800 square feet, which saves the franchisee real estate costs, he noted. Any given shift may have eight to 14 employees working.

Checkers was founded in Mobile, Ala., in 1986. It is now one of the official burger restaurants of NASCAR. It has 826 stores nationwide with plans to open 40 stores this year and 80 more across the country next year. Its food has a cult following, as does In-N-Out's, Levondosky said. The seasoned, battered fries are the chain's most popular fare. Oldies music is piped in to set the Fifties' drive-in mood.

Checkers' model thrives on becoming part of the neighborhood it serves, store by store, rather than mass marketing, he added.

"That's what we do best. We provide cups to (high school) football teams for their concessions and for little league. Then they come to us after the game," he said.

The Checkers exec adknowledged that competition in the Las Vegas market will be stiff.

"On the East Coast, we don't have the Carl's Jr.'s, In-N-Outs or Jack in the Boxes," he said.

Levondosky was buoyed by the success of Checkers in California markets, however, where those other chains do have a presence.

Checkers' move to Las Vegas makes sense, said Pat Moreo, the chair of the Food and Beverage Management department at the University of Nevada, Las Vegas' William F. Harrah College of Hotel Administration.

"I think it will be perfect for them. I think it will work well," he said.

Take-out food trends are on the Tampa-based chain's side, Moreo said.

"People are cooking at home less and less."