Chicken Delight is a chain of restaurants offering eat in, take out, and delivery service with a menu featuring chicken, pizza and ribs. Based in Winnipeg, the chain mostly has outlets in that city and throughout Manitoba, although a few are located in the New York metro area, and at other scattered locations in the United States and Canada.
The current operation is a relic of a much larger chain. Founded in Illinois in 1952, the chain grew to over 1,000 locations in the 1960s. It was purchased by Consolidated Foods in 1964. Its jingle "Don't cook tonight, call Chicken Delight", emphasizing their delivery service, was widely broadcast on American radio.
By the late 1960s, however, Chicken Delight in the US was a troubled operation. While emerging chains like McDonalds ensured that each and every outlet provided a product that met the franchisor's most exacting standards, the quality-control of Chicken Delight outlets in the US was lax. The company was fighting the battle of people who, having had a bad experience in one single outlet, generalized that to the whole chain, then told their friends to stay away.
At the same time, Chicken Delight was finding itself under increasing pressure from a fast-growing competitor, Kentucky Fried Chicken. Even though Chicken Delight and KFC were founded in the same year, Chicken Delight had grown far more quickly. KFC, in many markets, was just beginning to take hold. The competition became particularly strong when KFC added a new chicken product to their menu with a similar taste and texture to Chicken Delight's that they dubbed "Extra-Crispy."
When Chicken Delight was founded, franchisers typically used one of two different methods for collecting revenue. One was to collect 4% to 8% of gross sales, as is typically done now. The other method was to require their franchisees to buy all their equipment and packaging from the franchisor. Chicken Delight franchisees paid a little extra for each paper cup, each paper plate, the chicken-coating mix, etc., providing the franchisor with the money for corporate operations, advertising, and profit. A law firm felt this scheme ran afoul of the Sherman Anti-Trust Act which requires that the franchisor not sell products above fair market value. In the 1960s, they successfully sued on behalf of 94 franchisees and, in 1971, got a precedent-setting ruling from the US 9th Circuit Court of Appeals that broke the franchise contract for all stores and awarded their clients damages. (Siegel v. Chicken Delight, 448 F.2d 43 (9th Cir. 1971); reversed in modern times by decisions such as Queen City Pizza v. Domino’s Pizza, 124 F.3d 430 (1997).)
The lawsuit win proved to be a Pyrrhic victory, however, because Consolidated Foods (Now Sara Lee Corporation), then-owner of Chicken Delight, turned its back on the business in the US, leaving all its former US franchisees to fend for themselves. Today, some of the old US stores operate independently under names reminiscent of the original, such as "Chicken Tonight".
In 1979 Otto Koch, owner of the successful Chicken Delight Canada Ltd., purchased the remaining rump of the American operations, and a handful of true Chicken Delight stores can once again be found in the US operating under modern quality-control and contractual conditions.