With hamburger chains such as McDonald's and Burger King engaged in practically thermonuclear warfare, lesser fast-food conflagrations are easily overlooked. But the upscale burger battle between Fuddruckers and Flakey Jake's is war nonetheless. And Northridge is the bloody battleground.
Fuddruckers and Flakey Jake's are franchising as fast as they can all over the country, selling fresh ground, one-third pound and half-pound hamburgers in purposefully rough-hewn surroundings.
But nowhere have the two chains crossed spatulas as in the San Fernando Valley, where the fast-food serenity of Nordhoff Street is shattered by a Fuddruckers and a Flakey Jake's on opposite sides of Corbin Avenue. Both are company-owned. Flakey Jake's opened last August, followed by Fuddruckers in April.
"That is the only market in the country where they're going head to head," affirmed David Zuckerman, a senior editor at Nation's Restaurant News in New York.
Not Exactly Alike
The two Northridge eateries are not exactly alike. Fuddruckers, which got into the business first, charges less--in Northridge, $3.35 for a half-pounder, versus $3.95 at Flakey Jake's-- and looks like more of a warehouse. But both grind their meat on site--in sight, in fact--and both bake buns on the premises. At both restaurants there are lots of fresh sliced tomatoes, onions, lettuce and vats of cheese sauce.
There is also intense rivalry. Fuddruckers has contended all along that Flakey Jake's copied its formula, and even made a federal case of its allegation in U.S. District Court in Seattle, where its archrival is based. It charged Flakey Jake's with infringement of trade dress--a kind of commercial plagiarism--and Flakey Jake's promptly countersued, alleging San Antonio-based Fuddruckers was acting in restraint of trade.
Fuddruckers and Flakey Jake's are no longer suing each other--neither will discuss the 1983 out-of-court settlement--but their competition remains undiminished.
"As far as I'm concerned, they're copycats," Fuddruckers founder Philip Romano said.
"The reverse is true," insisted Jean Bakken, Flakey Jake's marketing vice president. "They may have been first, but we definitely are not copycats. We have a lot of unique differences, many of which they seem to be copying from us." She cites broader menus and children's portions as examples.
Indeed, industry analysts say that at this point the two chains seem to be copying from each other, and copycats are multiplying like rabbits in an effort to get in on the yuppie-burger business.
Burger entrepreneurs such as Romano are convinced that Americans are more quality-conscious these days, and figure they can get customers from McDonald's by emphasizing the freshness and generosity of the portions. They also serve beer and wine.
"The idea is that people are supposed to have graduated from fast food," Zuckerman said.
Surroundings Bare Bones
But fast food vestiges remain, foremost among them the lack of table service. Customers line up and carry away their food on trays, just like at McDonald's.
In the case of Fuddruckers in Northridge, the surroundings are deliberately bare bones, including crates of catsup and sacks of produce all over the place. Why the warehouse look?
"I wanted people to know our main effort is profit--er, excuse me, \o7 product\f7 ," Romano explained.
Both sides say they make better burgers, but Fuddruckers marketing vice president Michael Kelly goes one step further.
"I think the bun is the key," he said. "We think there's a distinct difference with our bun. It doesn't fight the burger."
Both Willy Stephenson, manager of Fuddruckers, and Paul Wilhite, his counterpart at Flakey Jake's, insist that business is great. "It's real good," said Wilhite. "A little too good," countered Stephenson. "We can't quite handle it."
Nationwide, 5-year-old Fuddrucker appears to be in the lead. It has 75 stores to the 2-year-old Flakey's 50 (both numbers are growing all the time with new franchises and company-owned stores) and Fuddrucker is also more profitable. In the case of both companies, about half their stores are company owned and half are franchised.
Flakey Jake's was founded by Sea Galley Stores Inc., a Seattle seafood chain that subsequently sold most of its interest to a group of investors led by Frank Carney, a co-founder of the Pizza Hut chain.
Fuddruckers had first-quarter earnings of $120,000 on revenue of $10.1 million, while Flakey posted a first-quarter loss of $515,000 on revenue of $5.3 million.
9 Local Sites Each
Both say they have nine sites in Southern California, and although both say they are doing well in Northridge, neither will disclose its volume there. Nationwide, good locations for either chain gross anywhere from $1.5 million to more than $2 million per year, analysts say.
In Northridge, Fuddruckers and Flakey Jake's probably have more than one another to worry about. Besides Corbin, practically the only things separating the two are Burger King, Solley's, Arby's, Page's, and Good Earth. All but Arby's sell hamburgers.