O'Charley's
Encyclopedia
O'Charley's is a casual dining
restaurant
s chain in the United States
, with more than 240 company-owned locations. O'Charley's is located in 17 Southern
and Midwestern
states, including four franchised O'Charley's restaurants in Michigan
, one franchised O'Charley's in Ohio
, three joint venture O'Charley's restaurants in Louisiana
, and one joint venture O'Charley's restaurant in Wisconsin
.
O'Charley's is part of the parent company O'Charley's, Inc. Enterprise, a multi-concept restaurant company that operates or franchises a total of 363 restaurants under three brands including O’Charley’s, Ninety Nine Restaurant, and Stoney River Legendary Steaks
.
. Watkins ran O'Charley's from 1969 to 1984 when he sold the restaurant to David K. Wachtel. David K. Wachtel spent 23 years working for Shoney's
where he eventually became president and chief executive officer of the restaurant company. Wachtel resigned from Shoney's in 1982. Wachtel intended to develop the O'Charley's restaurant into a restaurant chain. In mid-1987, the 12th O'Charley's opened in Lexington, Kentucky
, occupying a site formerly used by the Bennigan's
chain of restaurants. While the Lexington grand opening was under way, Wachtel was working on plans to convert two more Bennigan's
units in Huntsville
, Alabama
and Nashville
, Tennessee
into O'Charley's.
In the three years following Wacthel's purchase, O'Charley's had developed into a small regional casual dining chain of restaurants. In July 1990 O'Charley's had an initial public offering (IPO) of shares. The conversion to public ownership represented the second tool used by Wachtel to speed expansion. O'Charley's made its debut in the public spotlight just before tensions in the Persian Gulf flared and the United States implemented Operation Desert Storm. Further, a national economic recession was under way, exacerbating the effects of O'Charley's ill-timed IPO.
Following the initial public offering, O'Charley's per restaurant sales and profits plunged, falling to among the lowest in the restaurant industry nationwide precipitating a two-thirds fall in the stock price of O'Charley's compared to its initial value.
Five new restaurants were opened in 1990 and another five debuted in 1991 providing a presence in several small market Southern cities. By mid-1992, O'Charley's expanded to a 37-unit chain with restaurants clustered in eight Southeastern states. Three additional restaurants were slated for openings by the end of 1992 and another five units were scheduled to be developed in 1993. A renewed optimism regarding the company's expansion plans was attributable to the first financial results recorded after the menu and pricing changes were made in 1991. For the first fiscal quarter of 1992, O'Charley's reported a 30 percent jump in sales and a more encouraging 37 percent gain in profits, convincing management that the switch to a smaller menu had been the right move.
In June 1992, O'Charley's signed a letter of intent to form a partnership to purchase Logan's Roadhouse
restaurant, a casual steakhouse restaurant with a grill in public view, concrete floors, muraled walls, and buckets of peanuts in a "honky-tonk" atmosphere. Under the terms of the deal, the partnership called for the establishment of a minimum of five additional Logan's Roadhouse
restaurants during the ensuing five years, with the second unit targeted for its grand opening in Nashville
in August 1992. O'Charley's became a 20 percent owner in the partnership with the remaining 80 percent belonging to a small group of investors that included Wachtel and senior vice-president and chief operating officer, Charles F. McWhorter, Jr..
Slightly less than a year after Wachtel signed the Logan's Roadhouse agreement, he began to fade from the foreground at O'Charley's. In May 1993, Wachtel relinquished day-to-day control as president and chief executive officer to devote more time to other business projects, but continued to serve as chairman of O'Charley's. In his place, Gregory L. Burns was named president and selected to the additional post of chief financial officer, while McWhorter climbed the corporate rungs to the chief executive position. Although the orchestrator of O'Charley's resolute expansion for the previous nine years had stepped aside, the pace of expansion did not slacken in his absence.
In December 1993, Burns and McWhorter announced the formulation of a growth strategy designed to carry the 45-unit chain into the ranks of the country's largest regional dinner-house chains. In 1994, the company planned to open at least eight new O'Charley's restaurants, situating the new units primarily in southeastern markets such as Cookeville, Tennessee; Louisville and Paducah, Kentucky; and Palm Harbor, Florida. It was a year expected to be filled with news of new restaurant openings, but as the calendar flipped to 1994 other headlines grabbed the attention of both those inside and outside the company. In February 1994, Wachtel resigned as chairman of O'Charley's, citing his "pressing commitments" with other business interests, the most notable of which was the 300-unit Western Sizzlin' budget steakhouse chain he had acquired in 1993. Wachtel's full departure from O'Charley's made room for advancement for Burns and McWhorter. Burns was named chief executive and co-chairman and McWhorter was tapped as president and co-chairman. One month after Wachtel's resignation, the company received devastating news when it was announced that four former O'Charley's employees had filed a federal lawsuit charging the restaurant chain with racial discrimination practices against African Americans in the company's hiring, assignment, and promotion procedures. Burns flatly denied the charges, saying the lawsuit was "without merit and the company intends to defend it vigorously."
Brighter news for O'Charley's management arrived in 1995 when the company's involvement in the Logan's Roadhouse partnership turned into a source of cash to fund expansion during the year. The partnership completed an IPO in July 1995, netting O'Charley's $11 million, or more than half of the money needed to open the 11 new restaurants scheduled for grand openings in 1995. Meanwhile, to Burns's and McWhorter's consternation, the attorneys for the plaintiffs in the racial discrimination lawsuit were seeking to win class-action status, which threatened to broaden the scope and deepen the damage of the lawsuit. The attorneys were successful in winning class-action status.
O'Charley's agreed to settle the racial discrimination lawsuit it had been facing since 1994. In agreeing to settle the suit, and pay what eventually would amount to $6.2 million, Burns was adamant in his denial that there was any truth supporting the charges, declaring, "We agreed to this settlement because of the significant distraction the lawsuit has had on management and the uncertainty it has caused in the marketplace." One month after the settlement was announced, another management shakeup occurred when McWhorter resigned as president after his six-year tenure at the company. His departure left Burns in full power, occupying the posts of chief executive officer, president, and chairman of the board. The settlement of the lawsuit struck a decisive blow to O'Charley's profit total for 1996. After recording $10.6 million in profits for 1995, which had been inflated by the money gained through the sale of its stake in Logan's Roadhouse, O'Charley's registered a $1.15 million loss for 1996 on an 11 percent gain in sales to $164.5 million.
With its problems in the past, O'Charley's looked to significantly expand in the following years. By 1999 store count had surpassed 106 units. Led by Burns, the company began to entertain the idea of a growth-through-acquisition strategy. The firm made a play for the J. Alexander's chain in 1999 but its attempts were rebuffed by the J. Alexander's board of directors. At the same time, O'Charley's itself opted to turn down a buyout offer made by Wachtel, who believed the chain's shareholders would best be served by taking the chain private through a management-led leveraged buyout.
O'Charley's purchased an upscale Georgia
-based Stoney River Legendary Steaks
chain in 2000, from Pierre Panos and David Rowe, planning to open three new locations each year through 2004. O'Charley's then took its strategy one step further with the purchase of the casual-dining Ninety Nine Restaurant & Pub, an 80-unit chain with locations in Massachusetts
, New Hampshire
, Rhode Island
, Maine
, Vermont
, and Connecticut
. Announced in late 2002 and completed in early 2003, the deal bolstered the company's holdings by nearly 40 percent and gave it a solid foothold in the northeastern U.S. market.
During 2002, O'Charley's opened 24 new restaurants, bringing its total store count to more than 180 locations. The company was named to Forbes's "200 Best Small Companies in America" list for the third consecutive year in 2002, a testament to its successful expansion efforts during a considerable downturn in the U.S. economy. With sales and profits climbing steadily, management remained focused on strengthening its position as a multi-concept operator. The company also was looking into franchise options as a vehicle for future growth.
In 2004, Meritage Hospitality Group, Inc. opened an O'Charley's in Grand Rapids, Michigan as the nation’s first "O’Charley’s" restaurant franchisee.
In 2007, O'Charley's closed its Nashville commissary and distribution center, and began using Performance Food Group
to distribute product to all of its locations.
There are moderately priced menu items such as steak, chicken, pasta, and seafood.
Casual dining
This is a list of casual dining restaurant chains around the world, arranged in alphabetical order. A casual dining restaurant is a restaurant that serves moderately-priced food in a casual atmosphere...
restaurant
Restaurant
A restaurant is an establishment which prepares and serves food and drink to customers in return for money. Meals are generally served and eaten on premises, but many restaurants also offer take-out and food delivery services...
s chain in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
, with more than 240 company-owned locations. O'Charley's is located in 17 Southern
Southern United States
The Southern United States—commonly referred to as the American South, Dixie, or simply the South—constitutes a large distinctive area in the southeastern and south-central United States...
and Midwestern
Midwestern United States
The Midwestern United States is one of the four U.S. geographic regions defined by the United States Census Bureau, providing an official definition of the American Midwest....
states, including four franchised O'Charley's restaurants in Michigan
Michigan
Michigan is a U.S. state located in the Great Lakes Region of the United States of America. The name Michigan is the French form of the Ojibwa word mishigamaa, meaning "large water" or "large lake"....
, one franchised O'Charley's in Ohio
Ohio
Ohio is a Midwestern state in the United States. The 34th largest state by area in the U.S.,it is the 7th‑most populous with over 11.5 million residents, containing several major American cities and seven metropolitan areas with populations of 500,000 or more.The state's capital is Columbus...
, three joint venture O'Charley's restaurants in Louisiana
Louisiana
Louisiana is a state located in the southern region of the United States of America. Its capital is Baton Rouge and largest city is New Orleans. Louisiana is the only state in the U.S. with political subdivisions termed parishes, which are local governments equivalent to counties...
, and one joint venture O'Charley's restaurant in Wisconsin
Wisconsin
Wisconsin is a U.S. state located in the north-central United States and is part of the Midwest. It is bordered by Minnesota to the west, Iowa to the southwest, Illinois to the south, Lake Michigan to the east, Michigan to the northeast, and Lake Superior to the north. Wisconsin's capital is...
.
O'Charley's is part of the parent company O'Charley's, Inc. Enterprise, a multi-concept restaurant company that operates or franchises a total of 363 restaurants under three brands including O’Charley’s, Ninety Nine Restaurant, and Stoney River Legendary Steaks
Stoney River Legendary Steaks
Stoney River Legendary Steaks is a chain of steakhouses in the United States. There are 11 Stoney River Legendary Steaks restaurants in Georgia, Maryland, Illinois, Kentucky, Missouri, and Tennessee. Its parent company is O'Charley's, Inc...
.
History
Charley Watkins founded O'Charley's restaurant in 1969 with a single restaurant on 21st Avenue South in Nashville, across the street from Vanderbilt UniversityVanderbilt University
Vanderbilt University is a private research university located in Nashville, Tennessee, United States. Founded in 1873, the university is named for shipping and rail magnate "Commodore" Cornelius Vanderbilt, who provided Vanderbilt its initial $1 million endowment despite having never been to the...
. Watkins ran O'Charley's from 1969 to 1984 when he sold the restaurant to David K. Wachtel. David K. Wachtel spent 23 years working for Shoney's
Shoney's
Shoney’s is a privately held restaurant chain that operates primarily in the Southeast, Midwest and Mid-Atlantic states and is headquartered in Nashville, Tennessee. It is named after Alex Schoenbaum, who was the owner of the original chain of Big Boy restaurants in the southeastern United States...
where he eventually became president and chief executive officer of the restaurant company. Wachtel resigned from Shoney's in 1982. Wachtel intended to develop the O'Charley's restaurant into a restaurant chain. In mid-1987, the 12th O'Charley's opened in Lexington, Kentucky
Lexington, Kentucky
Lexington is the second-largest city in Kentucky and the 63rd largest in the US. Known as the "Thoroughbred City" and the "Horse Capital of the World", it is located in the heart of Kentucky's Bluegrass region...
, occupying a site formerly used by the Bennigan's
Bennigan's
Bennigan's is an Irish pub-themed casual dining restaurant chain with locations throughout the United States, and in 14 countries and 15 territories outside the continental U.S...
chain of restaurants. While the Lexington grand opening was under way, Wachtel was working on plans to convert two more Bennigan's
Bennigan's
Bennigan's is an Irish pub-themed casual dining restaurant chain with locations throughout the United States, and in 14 countries and 15 territories outside the continental U.S...
units in Huntsville
Huntsville, Alabama
Huntsville is a city located primarily in Madison County in the central part of the far northern region of the U.S. state of Alabama. Huntsville is the county seat of Madison County. The city extends west into neighboring Limestone County. Huntsville's population was 180,105 as of the 2010 Census....
, Alabama
Alabama
Alabama is a state located in the southeastern region of the United States. It is bordered by Tennessee to the north, Georgia to the east, Florida and the Gulf of Mexico to the south, and Mississippi to the west. Alabama ranks 30th in total land area and ranks second in the size of its inland...
and Nashville
Nashville, Tennessee
Nashville is the capital of the U.S. state of Tennessee and the county seat of Davidson County. It is located on the Cumberland River in Davidson County, in the north-central part of the state. The city is a center for the health care, publishing, banking and transportation industries, and is home...
, Tennessee
Tennessee
Tennessee is a U.S. state located in the Southeastern United States. It has a population of 6,346,105, making it the nation's 17th-largest state by population, and covers , making it the 36th-largest by total land area...
into O'Charley's.
In the three years following Wacthel's purchase, O'Charley's had developed into a small regional casual dining chain of restaurants. In July 1990 O'Charley's had an initial public offering (IPO) of shares. The conversion to public ownership represented the second tool used by Wachtel to speed expansion. O'Charley's made its debut in the public spotlight just before tensions in the Persian Gulf flared and the United States implemented Operation Desert Storm. Further, a national economic recession was under way, exacerbating the effects of O'Charley's ill-timed IPO.
Following the initial public offering, O'Charley's per restaurant sales and profits plunged, falling to among the lowest in the restaurant industry nationwide precipitating a two-thirds fall in the stock price of O'Charley's compared to its initial value.
Five new restaurants were opened in 1990 and another five debuted in 1991 providing a presence in several small market Southern cities. By mid-1992, O'Charley's expanded to a 37-unit chain with restaurants clustered in eight Southeastern states. Three additional restaurants were slated for openings by the end of 1992 and another five units were scheduled to be developed in 1993. A renewed optimism regarding the company's expansion plans was attributable to the first financial results recorded after the menu and pricing changes were made in 1991. For the first fiscal quarter of 1992, O'Charley's reported a 30 percent jump in sales and a more encouraging 37 percent gain in profits, convincing management that the switch to a smaller menu had been the right move.
In June 1992, O'Charley's signed a letter of intent to form a partnership to purchase Logan's Roadhouse
Logan's Roadhouse
Logan's Roadhouse is a chain of restaurants that was founded in 1991 in Lexington, Kentucky, and in 1999 became a wholly owned subsidiary of the publicly held CBRL Group, Inc...
restaurant, a casual steakhouse restaurant with a grill in public view, concrete floors, muraled walls, and buckets of peanuts in a "honky-tonk" atmosphere. Under the terms of the deal, the partnership called for the establishment of a minimum of five additional Logan's Roadhouse
Logan's Roadhouse
Logan's Roadhouse is a chain of restaurants that was founded in 1991 in Lexington, Kentucky, and in 1999 became a wholly owned subsidiary of the publicly held CBRL Group, Inc...
restaurants during the ensuing five years, with the second unit targeted for its grand opening in Nashville
Nashville, Tennessee
Nashville is the capital of the U.S. state of Tennessee and the county seat of Davidson County. It is located on the Cumberland River in Davidson County, in the north-central part of the state. The city is a center for the health care, publishing, banking and transportation industries, and is home...
in August 1992. O'Charley's became a 20 percent owner in the partnership with the remaining 80 percent belonging to a small group of investors that included Wachtel and senior vice-president and chief operating officer, Charles F. McWhorter, Jr..
Slightly less than a year after Wachtel signed the Logan's Roadhouse agreement, he began to fade from the foreground at O'Charley's. In May 1993, Wachtel relinquished day-to-day control as president and chief executive officer to devote more time to other business projects, but continued to serve as chairman of O'Charley's. In his place, Gregory L. Burns was named president and selected to the additional post of chief financial officer, while McWhorter climbed the corporate rungs to the chief executive position. Although the orchestrator of O'Charley's resolute expansion for the previous nine years had stepped aside, the pace of expansion did not slacken in his absence.
In December 1993, Burns and McWhorter announced the formulation of a growth strategy designed to carry the 45-unit chain into the ranks of the country's largest regional dinner-house chains. In 1994, the company planned to open at least eight new O'Charley's restaurants, situating the new units primarily in southeastern markets such as Cookeville, Tennessee; Louisville and Paducah, Kentucky; and Palm Harbor, Florida. It was a year expected to be filled with news of new restaurant openings, but as the calendar flipped to 1994 other headlines grabbed the attention of both those inside and outside the company. In February 1994, Wachtel resigned as chairman of O'Charley's, citing his "pressing commitments" with other business interests, the most notable of which was the 300-unit Western Sizzlin' budget steakhouse chain he had acquired in 1993. Wachtel's full departure from O'Charley's made room for advancement for Burns and McWhorter. Burns was named chief executive and co-chairman and McWhorter was tapped as president and co-chairman. One month after Wachtel's resignation, the company received devastating news when it was announced that four former O'Charley's employees had filed a federal lawsuit charging the restaurant chain with racial discrimination practices against African Americans in the company's hiring, assignment, and promotion procedures. Burns flatly denied the charges, saying the lawsuit was "without merit and the company intends to defend it vigorously."
Brighter news for O'Charley's management arrived in 1995 when the company's involvement in the Logan's Roadhouse partnership turned into a source of cash to fund expansion during the year. The partnership completed an IPO in July 1995, netting O'Charley's $11 million, or more than half of the money needed to open the 11 new restaurants scheduled for grand openings in 1995. Meanwhile, to Burns's and McWhorter's consternation, the attorneys for the plaintiffs in the racial discrimination lawsuit were seeking to win class-action status, which threatened to broaden the scope and deepen the damage of the lawsuit. The attorneys were successful in winning class-action status.
O'Charley's agreed to settle the racial discrimination lawsuit it had been facing since 1994. In agreeing to settle the suit, and pay what eventually would amount to $6.2 million, Burns was adamant in his denial that there was any truth supporting the charges, declaring, "We agreed to this settlement because of the significant distraction the lawsuit has had on management and the uncertainty it has caused in the marketplace." One month after the settlement was announced, another management shakeup occurred when McWhorter resigned as president after his six-year tenure at the company. His departure left Burns in full power, occupying the posts of chief executive officer, president, and chairman of the board. The settlement of the lawsuit struck a decisive blow to O'Charley's profit total for 1996. After recording $10.6 million in profits for 1995, which had been inflated by the money gained through the sale of its stake in Logan's Roadhouse, O'Charley's registered a $1.15 million loss for 1996 on an 11 percent gain in sales to $164.5 million.
With its problems in the past, O'Charley's looked to significantly expand in the following years. By 1999 store count had surpassed 106 units. Led by Burns, the company began to entertain the idea of a growth-through-acquisition strategy. The firm made a play for the J. Alexander's chain in 1999 but its attempts were rebuffed by the J. Alexander's board of directors. At the same time, O'Charley's itself opted to turn down a buyout offer made by Wachtel, who believed the chain's shareholders would best be served by taking the chain private through a management-led leveraged buyout.
O'Charley's purchased an upscale Georgia
Georgia (U.S. state)
Georgia is a state located in the southeastern United States. It was established in 1732, the last of the original Thirteen Colonies. The state is named after King George II of Great Britain. Georgia was the fourth state to ratify the United States Constitution, on January 2, 1788...
-based Stoney River Legendary Steaks
Stoney River Legendary Steaks
Stoney River Legendary Steaks is a chain of steakhouses in the United States. There are 11 Stoney River Legendary Steaks restaurants in Georgia, Maryland, Illinois, Kentucky, Missouri, and Tennessee. Its parent company is O'Charley's, Inc...
chain in 2000, from Pierre Panos and David Rowe, planning to open three new locations each year through 2004. O'Charley's then took its strategy one step further with the purchase of the casual-dining Ninety Nine Restaurant & Pub, an 80-unit chain with locations in Massachusetts
Massachusetts
The Commonwealth of Massachusetts is a state in the New England region of the northeastern United States of America. It is bordered by Rhode Island and Connecticut to the south, New York to the west, and Vermont and New Hampshire to the north; at its east lies the Atlantic Ocean. As of the 2010...
, New Hampshire
New Hampshire
New Hampshire is a state in the New England region of the northeastern United States of America. The state was named after the southern English county of Hampshire. It is bordered by Massachusetts to the south, Vermont to the west, Maine and the Atlantic Ocean to the east, and the Canadian...
, Rhode Island
Rhode Island
The state of Rhode Island and Providence Plantations, more commonly referred to as Rhode Island , is a state in the New England region of the United States. It is the smallest U.S. state by area...
, Maine
Maine
Maine is a state in the New England region of the northeastern United States, bordered by the Atlantic Ocean to the east and south, New Hampshire to the west, and the Canadian provinces of Quebec to the northwest and New Brunswick to the northeast. Maine is both the northernmost and easternmost...
, Vermont
Vermont
Vermont is a state in the New England region of the northeastern United States of America. The state ranks 43rd in land area, , and 45th in total area. Its population according to the 2010 census, 630,337, is the second smallest in the country, larger only than Wyoming. It is the only New England...
, and Connecticut
Connecticut
Connecticut is a state in the New England region of the northeastern United States. It is bordered by Rhode Island to the east, Massachusetts to the north, and the state of New York to the west and the south .Connecticut is named for the Connecticut River, the major U.S. river that approximately...
. Announced in late 2002 and completed in early 2003, the deal bolstered the company's holdings by nearly 40 percent and gave it a solid foothold in the northeastern U.S. market.
During 2002, O'Charley's opened 24 new restaurants, bringing its total store count to more than 180 locations. The company was named to Forbes's "200 Best Small Companies in America" list for the third consecutive year in 2002, a testament to its successful expansion efforts during a considerable downturn in the U.S. economy. With sales and profits climbing steadily, management remained focused on strengthening its position as a multi-concept operator. The company also was looking into franchise options as a vehicle for future growth.
In 2004, Meritage Hospitality Group, Inc. opened an O'Charley's in Grand Rapids, Michigan as the nation’s first "O’Charley’s" restaurant franchisee.
In 2007, O'Charley's closed its Nashville commissary and distribution center, and began using Performance Food Group
Performance Food Group
Performance Food Group Company is a company that was founded in 1875. Headquartered in Richmond, Virginia, United States, the company distributes a range of food products....
to distribute product to all of its locations.
Awards
Named to Forbes "200 Best Small Companies in America" list for the third consecutive year in 2002.Menu
The menu features a wide selection of appetizers, salads, steaks, sandwiches, burgers, entrees and desserts. Often individual restaurants will personalize dishes, making them variants of the listed menu items, and adding their own flair and style to the entree.There are moderately priced menu items such as steak, chicken, pasta, and seafood.