Sonic Drive-In
| File:Sonic-logo.jpg | |
| Company type | Public (NASDAQ: SONC) |
|---|---|
| Industry | Restaurants |
| Founded | 1945 (Shawnee, Oklahoma) |
| Founder | Troy Smith |
| Headquarters | , USA |
Number of locations | 3462 |
Key people | J. Clifford Hudson Chairman, CEO and president, W. Scott McLain president SONIC Industries (franchising sub), Eddie Saroch president SONIC Restaurants, Inc. (operating subsidiary) |
| Products | Fast food |
| Revenue |  $805 Million USD (2008) |
| $60 Million USD (2008) | |
Number of employees | 357 Corporate employees |
| Website | www.SonicDriveIn.com |
Sonic Corporation Nasdaq: SONC (operating name: Sonic Drive-In) is an American fast-food restaurant chain based in Oklahoma City, Oklahoma, that recreates the drive-in diner feel of the 1950s, complete with carhops who sometimes wear roller skates. There were 3,400 restaurants in 34 U.S. states, plus one in Mexico, as of November 18, 2008.[1]
History
1950s
Troy N. Smith, Sr. opened the first Sonic Drive-In in Stillwater, Oklahoma, in 1953, calling it the Top Hat. The Top Hat was originally a small root beer stand. Customers would park anywhere on the gravel lot. On a trip to Louisiana, Smith saw a drive-in that utilized speakers for ordering and realized that he could increase his sales if he could control the parking and have the customers order from speakers at their cars with carhops to deliver the food. He borrowed several cars from a friend who owned a used car lot to establish a layout for controlled parking. He had some "juke box boys" come in to wire an intercom system. His sales tripled immediately and his little root beer stand was a huge success. Entrepreneur Charles Woodrow Pappe stopped by chance at the Shawnee drive-in and was very impressed. He got out of his car and began to take measurements of the stalls, trying to figure out why they were not all the same size, assuming that it was an essential ingredient of the business plan. Smith came out and introduced himself and explained that the stalls were different sizes simply because different-sized cars had been used when he laid everything out. The two men hit it off and negotiated the first franchise location in Woodward, Oklahoma, in 1956.
By 1958, two more drive-ins were built in Enid and Shawnee, Oklahoma. Upon learning that the Top Hat name was already trademarked, Troy Smith and Charles Pappe changed the name to Sonic. The new name worked with their existing slogan "Service with the Speed of Sound". After the name change, the first Sonic sign was installed at the former Top-Hat Drive-In Stillwater, Oklahoma. This location has been considered to be the first Sonic Drive-In, and the original sign can still be seen in Stillwater. While Smith and Pappe were being asked to help open new franchise locations, however, there was no royalty plan in place. The pair decided to have their paper company charge an extra penny for each Sonic label hamburger bag they sold. The proceeds were to split half for Smith and half for Pappe. The first franchise contracts under this plan were drawn up by Smith's landlord O.K. Winterringer, who was also a lawyer. At the time, there was no joint marketing plan or standardized menu and few operating requirements.
1960s and '70s
Sonic's founders formed Sonic Supply as a supply and distribution division in the 1960s. Under Troy Smith, Marvin Jirous and Matt Kinslow (longtime franchise holders) were brought in to run the Sonic Supply division. In 1973, Sonic Supply was restructured as a franchise company that was briefly named Sonic Systems of America which sold franchisees equipment, building plans and provided some basic operational instruction.
As Sonic grew into a regionally known operation in the 1960s and 1970s, they were located mainly in small towns in Oklahoma, Texas, Kansas, New Mexico, Missouri, and Arkansas. In 1967, the year of Charles Pappe's death, there were 41 Sonic locations.[2] The number continued to grow, and by 1972 there were 165 locations. Between 1973 and 1978 Sonic opened more than 800 locations in 13 states. In 1977, the Sonic School for manager training was established under Jim Winterringer's guidance. Most of the drive-ins were operated by franchisees who often made the store manager a business partner which is still often the case today.
During the 1960s and 1970s, Sonic had no strict standardized procedures or recipes in place for their franchisees.[citation needed] Franchisees or franchise groups often developed their own recipes for different menu items or regional specialties. These variations hampered Sonic's growth during this period, which sometimes led to disagreements between franchise groups over menus, pricing, coupons and advertising.[citation needed] As a franchiser, Sonic did not inspect or monitor its franchisees' operations. Customers never knew what to expect in terms of menu, quality and service. Sonic's future growth was in doubt, and by the 1980s the company was losing money.[3]
1980s
In 1983, Smith and the Board of Directors saw the need for a change. C. Stephen Lynn was brought in as President, and in 1984 he hired attorney J. Clifford Hudson to head the legal department. Under Lynn, Sonic and its major franchisees began to encourage the development of local advertising co-ops, and then-Marketing Director Keith Sutterfield developed Field Marketing Representatives to work with the franchisees.[citation needed] Joint advertising brought significant sales growth, and this growth helped franchisees see the benefits of cooperation. Sonic Industries developed a new franchise agreement that required higher royalties and marketing expenditures.[citation needed] There was reluctance to accept these changes by some franchisees, however, the leadership and support of major franchisees like Mason, Harrison & Jarrard, Pete Esch, Bobby Merritt, Ted Kergan, Jim Winterringer, Marvin Jirous and the Winters Group had a major impact.[citation needed] In 1985, the Sonic Management School was re-established and taught for the next 10 years by Doyle Paden, Dona Grigsby, and Carl Rose. The school stressed the importance of standardized procedures, sanitation and employee training. Drive-ins were inspected and "mystery-shopped". New franchises began to expand the company to new areas and redevelop markets that had been unsuccessful in the past. A "Speed of Service" system was developed under Wallace Hite which reduced the standard order time from seven minutes to under three minutes.[citation needed] These developments combined with the advertising campaign featuring Frankie Avalon led to significant growth and a new image that would make Sonic a nationally-recognized name. The exterior of a fairly typical Sonic from this period (the one located in Marfa, Texas), can be seen briefly in the 1985 Kevin Costner film Fandango.
In 1986, C. Stephen Lynn, with a group of investors, performed a leveraged, $10 million buyout and took the company private. Sonic moved its offices to leased space in downtown Oklahoma City in 1987 at 120 Robert S. Kerr Ave. and began to assume a higher profile in the community. Also in 1987, Sonic opened its 1,000th restaurant. Sonic moved again to better facilities at 101 Park Avenue in a project led by then CFO Ray Fain. Pattye Moore became the new VP of Marketing.
1990s
Sonic became a publicly traded company again in 1991, and in 1994 the corporation had finished renegoiating the franchise agreements with its franchisees.[4] In 1995 J. Clifford Hudson[5] had taken over the reins as President and CEO, and Sonic Industries became Sonic Corporation. During the mid-1990s, Sonic was opening 100 - 150 new restaurants a year. Beginning in 1998, Sonic began to redesign and update all 1,750 stores in their chain with what was called a "Retro-future" look.[6]
2000s
J. Clifford Hudson was named chairman of Sonic Corp. in January 2000. [7] The company moved into its new headquarters building in the Bricktown district of Oklahoma City. In 2005, the company added a fuel station to the drive-in. Doing this gave Sonic many more customers.
Menu items
Food
In the 1960s, Sonic meals were traditionally accompanied by a peppermint candy and small colored plastic animals called zoo-picks hanging on the side of drink cups[8] until they were outlawed by consumer product safety laws as a choking hazard.[citation needed] The traditional peppermint candy is still served with Sonic meals today.
Sonic has featured unique menu items like hand-made Onion Rings and Pickle-Os (breaded deep-fried dill pickle slices) as well as such drive-in staples as hamburgers, Coneys (hot dogs covered with chili and shredded cheese) and corn dogs, shakes and malts. During its early years, some Sonic frachise locations also featured regional items on their menu. Other notable menu items include Ched 'R' Peppers (a form of the popper) and tater tots. Dessert frozen treats such as Oreo/M&M's/Reese's/Butterfinger Blasts are also available.
Drinks
Different flavors such as vanilla, chocolate, cherry, strawberry, cranberry, apple, etc are available and can be added to drinks. Popular drinks include Ocean Water (Sprite with blue colored coconut flavoring added) or Limeades (Sprite with lime or other flavors added). Sonic uses the slogan as "Your Ultimate Drink Stop" due to the 168,894 possible drink combinations. Its advertising also states that "You could have a new drink every day for the next 462 years". The true number of possible combinations is higher.[9]
Promotions and hours
"Brown Bag Specials" was a promotion consisting of two orders of french fries, soft drinks, and two single-patty hamburgers in a small brown lunch bag. This promotion was available until a menu change in 2005. As of November 1, 2008, the "Brown Bag Specials" have made a comeback, offering the same deal again, for $6.99 (plus tax). This is only a promotion for the month of November, along with the Sticky Dough Bun Blast, also promoted in November 2008.
On December 29, 2008 Sonic debuted its "Everyday Value Menu", offering a variety of menu items for only $1 (plus tax) each. Items on the menu include the Jr. Deluxe Burger, Chicken Strip Sandwich, Jr. Fritos(R) Chili Cheese Wrap, Jr. Breakfast Burrito, Jr. Candy Sundae, small Tots, small Fries, small Famous Slush, small Soft Drink, small Vanilla Cone, and a Fresh Banana. The items on the value menu may vary at different Sonic locations.[10]
Recently, some Sonic locations started a special called "Five for Five Tuesdays" where five burgers could be ordered for five dollars (plus tax). Other locations serve half-priced burgers on Tuesdays.
All locations also feature "Happy Hour" every day from 2-4 pm in which the customer may buy soft drinks, slushes, limeades and iced tea for half price. Happy Hour became a national promotion starting in the end of 2007.[11]
The full menu, which includes breakfast items, is served all day. Most Sonic Drive-In locations open by 6am. However, there are some variations depending on the franchisee or the landlord.
Advertising
1970s
In 1977, Sonic ran its first television commercial.[12]
1980s
In the 1980s, many Sonic Drive-Ins had signs that said "Happy Eating". Also, during the early 1980s, Happy Days actor Tom Bosley was featured in their TV ads.[13] One of Sonic's most memorable television ad campaigns featured 1950s icon Frankie Avalon; this campaign ran from 1987 to 1993.[14]
1990s
In May 1999 Sonic began a new advertising campaign featuring the character Katie the Carhop.[15]
2000s
Sonic is also involved in NASCAR. Sonic signed on with Dale Earnhardt Racing in late 2000 to be an associate sponsor for Dale Earnhardt, Sr. during the 2001 race season. Earnhardt was killed in the first race of the 2001 season, the Daytona 500, and Sonic continued sponsorship for Kevin Harvick, Childress's new driver of Earnhardt's car, through the end of the 2003 season.
In 2004, the company became more widely known by advertising in markets hundreds of miles from its nearest franchise. It also uses the slogan "Sonic's got it... others don't," as well as "It's not just good... it's Sonic good," implying a higher standard of quality than normal fast-food fare.
The newest tagline is "Sonic is even sweeter after dark." This refers to the fact that some locations now close at midnight or later.
Improv actors T. J. Jagodowski and Peter Grosz are known to American television viewers from their series of "Two Guys" advertisements for the Sonic Drive-In restaurants. Similar series of commercials also ran featuring other duos of improv performers (Molly Erdman and Brian Huskey, and Katie Rich and Sayjal Joshi).
References
- ^ Market Map. Official Sonic Web Site, America's Drive-in Brand Properties LLC.
- ^ Cite error: The named reference
sonicdrivein.comwas invoked but never defined (see the help page). - ^ "Over-the-Counter in 1973". Sonic Corp. - Company Profile, Information, Business Description, History, Background Information on Sonic Corp. Answers.com. Retrieved 2008-07-17.
{{cite web}}: Cite has empty unknown parameter:|coauthors=(help) - ^ "Public again in 1991". Sonic Corp. - Company Profile, Information, Business Description, History, Background Information on Sonic Corp. NetIndustries, LLC. 2007. Retrieved 2008-07-21.
{{cite web}}: Cite has empty unknown parameter:|coauthors=(help) - ^ Executive Team Member Profile: J. Clifford Hudson. Official Sonic Web Site, America's Drive-in Brand Properties LLC.
- ^ Cite error: The named reference
referenceforbusiness.comwas invoked but never defined (see the help page). - ^ Executive Team Member Profile: J. Clifford Hudson. Official Sonic Web Site, America's Drive-in Brand Properties LLC.
- ^ "Critters on Your Drink Cup". I remember JFK. Retrieved 2008-07-18.
{{cite web}}: Cite has empty unknown parameter:|coauthors=(help) - ^ Bialik, Carl (November 27, 2007). "Counting the Drink Combos at a Sonic Drive-In". The Numbers Guy. The Wall Street Journal. Retrieved 2008-07-05.
{{cite web}}: Cite has empty unknown parameter:|coauthors=(help) - ^ Strohm, Anita (December 29, 2008). "Ring in the New Year with a Budget-Friendly Meal: Sonic Drive-In Launches Everyday Value Menu; Affordable Value Items for a $1 each, All Day, Every Day". Sonic Drive-In Corp. Retrieved 2009-01-07.
{{cite web}}: Cite has empty unknown parameter:|coauthors=(help) - ^ Wenning, Todd (January 4, 2008). "Happy Hour at Sonic". The Motley Fool. Retrieved 2008-07-05.
{{cite web}}: Cite has empty unknown parameter:|coauthors=(help) - ^ "Chronology". Sonic Corp. - Company Profile, Information, Business Description, History, Background Information on Sonic Corp. NetIndustries, LLC. 2007. Retrieved 2008-07-05.
{{cite web}}: Cite has empty unknown parameter:|coauthors=(help) - ^ Perlik, Allison (7/1/2004). "Timeline - 1980". The 400 at 40 - A Retrospective. Restaurants & Institutions. Retrieved 2008-07-05.
{{cite web}}: Check date values in:|date=(help); Cite has empty unknown parameter:|coauthors=(help) - ^ "A Brand New Look in 1998". Sonic Corp. - Company Profile, Information, Business Description, History, Background Information on Sonic Corp. NetIndustries, LLC. 2007. Retrieved 2008-07-05.
{{cite web}}: Cite has empty unknown parameter:|coauthors=(help) - ^ Arellano, Kristi (July 2, 1999). "The Sonic boom". Denver Business Journal. Retrieved 2008-07-05.
{{cite web}}: Cite has empty unknown parameter:|coauthors=(help)