IHOP hits a 10-year best

Robert Chacon

IHOP has posted the largest first-quarter revenue gains in a decade

for restaurants that have been open more than 18 months -- a

noteworthy indicator of the Glendale company’s financial health,

officials said.

Same-store sales for the period ending March 31 increased by more

than 7% over the same period last year.

“This is the most significant indicator that we are doing well,

because it shows that our existing stores are doing well,” IHOP

spokesman Patrick Lenow said. Franchise-based companies usually

increase revenues by adding new locations, he added.

Lenow said IHOP does not provide a breakdown of how much revenue

the increase represents. Total sales for the company are scheduled

for release April 22. Last year’s first-quarter revenues were $413.8

million.

IHOP’s one location in Glendale, 605 N. Glendale Ave., has been

there for about 40 years. Noticing an increase in sales is difficult,

manager Hilario Villanueva said.

“We are so busy all the time, I don’t know if we have more

customers or not,” he said.

Lenow credits the chain’s success to a new business model that

freed up money for consumer research, employee training and

marketing.

In 2003, IHOP stopped financing new franchises and transitioned

into a more traditional model in which franchise owners supply their

own money to develop a new restaurant.

The company invested more into marketing, allowing the 45-year-old

company to run commercials on network television for the first time

in its history, Lenow said.

“We are seeing a definite upturn in first-time and repeat

customers,” he said.

IHOP officials do not plan any major changes in the near future

and will continue investing in marketing and training for employees,

Lenow said.