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Burger King hopes to build style, traffic

A Burger King franchise sports the company’s new “20/20’’ design in the Houston suburb of Spring, Texas. A Burger King franchise sports the company’s new “20/20’’ design in the Houston suburb of Spring, Texas. (Pat Sullivan/ Associated Press)
By Ashley M. Heher
Associated Press / October 7, 2009

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CHICAGO - Burger King Corp. plans to swap its generic fast-food feel and bland tiles and tabletops for a vibe that is more sit-down than drive-through.

As part of a plan to be revealed today, the company will announce a massive effort to overhaul its 12,000 locations worldwide.

The new interiors include rotating red flame chandeliers, brilliant TV-screen menus, and industrial-inspired corrugated metal and brick walls.

“I’d call it more contemporary, edgy, futuristic,’’ chief executive John Chidsey said. “It feels so much more like an upscale restaurant.’’

But that comes with an upscale price: The new look is expected to cost franchisees, who operate 90 percent of Burger King’s locations, between $300,000 and $600,000 per restaurant.

The company said the new design, called “20/20’’ at the Miami-based chain, is in place at about 60 locations. But it will take years before all locations are switched.

Franchise owners are contractually required to update their restaurants after a set period, and executives said the redesign will be the primary option for future upgrades. All new restaurants will be built using the plan.

Burger King expects about 75 more redesigned restaurants to be open by the end of next year.

So far, remodeled restaurants have seen sales climb by 12 to 15 percent, while restaurants that are torn down and completely rebuilt at the same location have seen sales climb by as much as 30 percent, Chidsey said.

Observers say the hip, urban, and masculine elements in the redesign might be a hit with Burger King’s most loyal customers - young men who frequent the chain known as much for its signature Whoppers and “steak burgers’’ as its “King’’ commercials. But some analysts are skeptical about whether sales will climb as much as the company hopes, and how eager franchise owners will be to part with that kind of cash, particularly in a sour economy.

Chidsey thinks most franchise owners, who typically own both their building and the land, will not have trouble obtaining financing and will be swayed once they see how sales can climb.

Morningstar analyst R.J. Hottovy said the restaurant could keep diners at the table longer but might not draw in enough extra diners to justify the cost.

“I don’t think they’ll change their perception,’’ he said. “They’re pretty entrenched in their reality.’’