Marriott Looks to Speedy Expansion : Big Boy Restaurants Plan to Open 200 New Locations

Now that Big Boy is here to stay, he is growing bigger than ever.

The chubby cherub in the checkerboard pants, who survived a company-sponsored ballot last year on whether he should stay or go, will move to more than 200 new locations nationwide over the next two years, according to Big Boy’s parent, Marriott Corp.

Since acquiring Howard Johnson Co. in November, Marriott has begun converting many of the familiar orange roofs and blue steeples of roadside HoJos to Big Boys as a way to expand its operations rapidly without the heavy capital expenditures required to build restaurants from scratch.

The Big Boy conversions further accelerate Marriott’s race to beat Denny’s Inc. as the nation’s No. 1 restaurant in the hotly competitive coffee-shop market, analysts say.

“Marriott’s acquisition of Howard Johnson Co. certainly gives them a heck of a leg up in that direction,” said John J. Rohs, an analyst with Wertheim & Co.

“They have been saying for quite some time now that they intend to revamp the Big Boy system and to make it the clear leader in the coffee-shop segment of the market,” said Stephen A. Rockwell, who monitors the company for the Alex. Brown & Sons brokerage firm in Baltimore.

The HoJo acquisition was considered a bargain because Marriott believes that it can make the outlets immediately more valuable by converting them to Big Boys. HoJo restaurants average only about $750,000 to $850,000 per unit in annual sales, while the average Big Boy takes in about $1.1 million per unit, according to analysts.

After the Big Boy conversions, the chain will include as many as 1,122 restaurants. Denny’s, founded in 1953 in California, has about 1,163 units, predominantly on the West Coast.

The first Big Boys being converted are two company-owned restaurants in Virginia, said J. Michael Jenkins, executive vice president and general manager of Big Boy Family Restaurant System.

Many of the new Big Boy outlets will be located on the East Coast, the one section of the country that Big Boy has not penetrated, analysts say. A large number of Big Boys are now in California.

Marriott acquired the 60-year-old HoJo restaurant and hotel chain from the Imperial Group, a British conglomerate, for about $300 million. Almost all hotels and lodges operated by Howard Johnson and its Howard Johnson Motor Lodge & Restaurant Franchise Systems unit were sold to Prime Motor Inns of Fairfield, N.J., for $235 million.

Much of the $65 million that Marriott spent on the deal is expected to be recouped through the sale of some of the operations, as well as income from the new Big Boy locations.

Marriott retained 350 Howard Johnson company-operated restaurants and 68 turnpike restaurants, plus vending, manufacturing and distribution operations and several hotel-related operations.

“Marriott ended up paying a very reasonable price to acquire the company-owned Howard Johnson restaurants,” Rohs said. “And they intend to convert approximately 200 of the best sites to Big Boys and sell the rest.”

Of the 200 conversions, about two-thirds will be franchised shops and the rest will be company-owned restaurants, Rohs said.

There are now 872 Big Boy restaurants in the United States and abroad, of which about a quarter are company-owned.

Big Boy made his debut on Aug. 6, 1936, in Glendale in a 10-stool counter shop called Bob’s Pantry, run by Bob Wian.

Bob’s expanded during the next 30 years, and Marriott bought the 22-restaurant chain in 1967, reportedly for about $7 million.

Marriott turned to its patrons last year to vote on whether Big Boy should spiff up his image and change out of those checkerboard pants. “Should he stay or go?” Marriott asked customers of the pompadoured corporate symbol, who stands enshrined in plastic outside most of the company’s restaurants. Customers voted for the little guy to stay.

Marriott also has been upgrading Big Boys by changing the menus and toning down the decor.