“From Beloved Beacon to Forgotten Relic: Unraveling the Astonishing Decline of Howard Johnson’s Empire”
So, with such dominance and perfected model, and similar restaurant chains still booming today… what happened? How was it that within only a couple decades of this peak the chain would be all but extinct?
Well, it turns out there were a number of factors involved that all more or less hit the company at the same time. But perhaps the most pertinent change was the transition of leadership from Howard Johnson to his son, Howard Brennan Johnson in 1959, though with Howard Johnson himself staying involved as CEO until 1964 and Chairman until 1968, and then peripherally involved until his death at the age of 75 in 1972.
Brennan Johnson did have some success in the early going, first by taking the company public in 1961 bringing in some $125 million (about $1.3 billion today), as well as continuing expansion efforts with these funds, including starting other chains such as Ground Round Grill and Bar which peaked at over 200 restaurants, but has since dwindled to only 15 today. He also converted many of the Howard Johnson’s locations on toll ways to Burger Kings owned by Howard Johnson’s for further diversification, as well as diligently working to buy out most of the franchise locations in hopes of phasing out the franchising model for the company.
So that was all the good side. What went wrong?
For starters, fast-food chains like McDonald’s, Burger King, and KFC were gaining market share like crazy, increasing competition, which was in part why Brennan Johnson had purchased many Burger King franchises and tried to expand to other restaurant offerings as well.
