Yahoo Finance Perkins, the aging diner chain, has a ‘new vibe’ with a different name
At 66 years old, Perkins Restaurant and Bakery is due for a touch up.
The diner chain, best known for its pies and pancakes, is getting a major makeover that includes a new logo and name, a redesign of its nearly 300 restaurants as well as a revamped menu, which still emphasizes value, with refreshed ingredients in hopes of attracting new customers that have forgotten about the chain.
Perkins’ changes come as similarly aged rivals, like Cracker Barrel, are facing struggles to remain relevant, especially with older diners that have changed their habits following Covid-19 as well as surging menu prices that are forcing people to eat more affordably at home because grocery prices are rising at a slower pace.
The whole “new vibe,” as Perkins President Toni Ronayne describes it, comes from its research that “guests want the American classics of yesterday in a place that feels like today.”
First, the name is changing to “Perkins American Food Co.” making it more encompassing of what it offers. That means “bakery,” which has been part of its moniker for the past five decades, is disappearing but the bakery will still exist in its restaurants.
The refreshed name “really speaks to our American values and the American comfort food we deliver,” Ronayne told CNN. “We felt this was a more modern, fresh and relevant vibe to start connecting with new consumers, while also servicing our guests that are tried-and-true Perkins loyalists.”
Along with the new name, the company will freshen up the green used in its logo with a new lighter version that “leans into a more of heritage palette that still feels modern.” The refreshed logo will also keep a retro feel.
Restaurants will be remodeled in the coming years to reflect the changes, with the bakery still front and center near the entrance. The drab coloring that was part of its 2013 renovations is going away. Meanwhile, new digital menu boards will hang above the bakery. Modern subway tiles will line its walls along with brighter flooring, new tables, silverware and uniforms.
Perkins didn’t reveal costs of the renovations for franchisees, but Ronayne said it hopes to grow the chain’s footprint with new versions that are more affordable to build. (A new location showcasing all the changes opens in Orlando, Florida, later this year.)
The menu is also getting tweaked, with eaters seeing that roll out over the next several months. Perkins hope new hamburgers and updated ingredients in other foods, , such as new seasoning on its french fries, will help convince customers that it isn’t just for breakfast and pies.
For example, a construction of a new Perkins is now 3,500 square feet (a reduction of 6,000 square feet) with smaller kitchens and dining rooms. It’s also piloting an even smaller prototype, dubbed “Perkins Express,” for spaces where a traditional restaurant can’t fit like airports or mall food courts.
Perkins has positioned itself for eaters on a budget, with a variety of platters that includes a main and a few side dishes. Although that won’t drastically change with the new menus, Ronayne said the chain “will continue to evolve and explore pricing in our restaurants and in our menu items ensuring that we’re able to provide value and remain competitive.”
“We know that value is so critical right now and we’re very mindful of that,” she said. “We want to be the leader of family dining and be able to reach guests that are looking for both value and premium options.”
Other breakfast-focused competitors have been feeling the economic pressure. IHOP, owned by Dine Brands (DIN), reported in its most recent earnings that same-store sales fell nearly 2% because of higher menu prices. Denny’s (DENN) also reported a tough quarter because of similar problems and its stock is down nearly 35% for the year.
Perkins’ sales have slid about 5% every year since 2019, according to Technomic data, and several locations have closed since then. The segment is a “tough one” because of a number of competitors, said David Henkes, senior principal for the consulting firm.
“The brand largely appeals to Baby Boomers, and I think the opportunities for Perkins lies in creating a broader brand appeal and trying to reach other dayparts and occasions,” he told CNN.
Perkins’ problems
Perkins has been privately owned by Ascent Hospitality Management since 2019, which also controls Huddle House. The firm is investing in the classic American brand that’s been marred with financial issues, including two bankruptcies, following a disastrous 2006 merger with Marie Callender’s.
Its location count has dwindled by nearly half in recent years, customer traffic has slipped and competition from both fast food and new, fresher-looking upstarts are on the rise, according to R.J. Hottovy, head of analytical research for Placer.ai.
“Perkins has faced a number of challenges the past several years, including new sources of competition from emerging breakfast-first chains like First Watch and consumers shifting to more affordable options in the quick service restaurant and value grocery categories,” he told CNN.
Remodels of aging companies “successfully drive increased visits by repositioning their brand, remodeling stores, and making enhancements to their menu, but usually in conjunction with an increased emphasis on affordability or other promotional activity,” he added.
Perkins is optimistic the changes, which will be highlighted in a new marketing campaign, will work. After all, Ronayne said that it’s endured prior name changes: The first location opened in Cincinnati, Ohio, as Perkins Pancake House in 1958. About a decade later the company tweaked its name to Perkins Cake and Steak for a brief time before changing to its current branding.
“We really feel that this iteration of ‘Perkins American Food Co.’ is going to marry tradition and innovation and keep us true to who we are,” she said. “We recognize there’s an opportunity for us to reach different consumers.”
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