Hardee’s in Crisis: Can the Iconic Fast-Food Chain Survive the Storm?

Image credit: Restaurant Business Magazine

Hardee’s, a staple in the Southeast and Midwest fast-food scene, faces a precarious future as signs of trouble mount for the beloved chain. Founded in 1960 by Wilber Hardee in Greenville, North Carolina, Hardee’s has grown into a network of over 1,800 stores across the United States and 13 countries, offering a diverse menu that caters to breakfast, lunch, and dinner cravings alike. However, recent developments suggest that Hardee’s may be struggling to maintain its foothold in the competitive fast-food landscape.

Summit Restaurant Holdings’ Bankruptcy Declaration Raises Concerns
The latest blow to Hardee’s comes in the form of Summit Restaurant Holdings’ Chapter 11 bankruptcy filing in May 2023. As a major franchise holder of Hardee’s, Summit’s bankruptcy led to the closure of 39 restaurants across eight states, including Alabama, Florida, and Georgia. While Summit’s bankruptcy does not directly impact Hardee’s parent company, CKE Restaurant Holdings, the closure of such a significant number of stores signals potential challenges for the brand’s overall reputation and profitability.

Controversial Marketing Campaigns Stirred Public Backlash
In addition to operational hurdles, Hardee’s has faced criticism for its marketing strategies, particularly from 2009 to 2015, when the brand produced sexually suggestive advertisements that garnered widespread condemnation. Featuring prominent figures like Paris Hilton and Kim Kardashian, these ads drew ire from viewers and raised questions about the appropriateness of using sexual imagery to promote fast food. Despite efforts to shift focus back to the food itself in 2017, the damage to Hardee’s reputation may have already been done, contributing to its struggles in retaining customers.

Trademark Dispute Limits Expansion Opportunities
Hardee’s expansion into Canada has been hampered by a trademark dispute with the existing Canadian chain, Harvey’s. While Carl’s Jr., another CKE-owned brand, managed to establish a presence in Canada, Hardee’s has been unable to enter the market due to similarities with Harvey’s. This limitation not only restricts Hardee’s growth potential but also diminishes its brand awareness on an international scale, further complicating its efforts to revitalize its image.

Negative Customer Reviews and Operational Challenges
Online reviews from disgruntled customers highlight recurring issues with Hardee’s service and food quality. Complaints range from rude staff and unsanitary conditions to incorrect orders and subpar dining experiences. Moreover, recent changes in drink sizes, where larger portions were replaced with smaller ones without a corresponding price reduction, have sparked customer dissatisfaction and raised concerns about cost-saving measures at the expense of consumer satisfaction.

Struggles to Improve Drive-Through Efficiency
Hardee’s dismal performance in drive-through satisfaction surveys underscore its challenges in delivering efficient service to customers. Ranking last in overall service quality, speed, and accuracy, Hardee’s faces an uphill battle in meeting customer expectations and competing with more efficient rivals in the fast-food industry. While the introduction of AI chatbots aims to streamline drive-through operations, concerns remain about their effectiveness in handling customer inquiries and enhancing the overall dining experience.

Menu Changes Reflect Business Realities
The discontinuation of plant-based menu options introduced in 2019 highlights Hardee’s response to shifting consumer preferences and operational realities. Despite initial enthusiasm for these offerings, poor sales prompted their removal from the menu, signaling Hardee’s focus on cost-cutting measures and prioritization of its core menu items.

Economic Pressures Exacerbate Challenges
Rising food, transportation, and labor costs, compounded by declining sales during the pandemic, have strained Hardee’s finances and operational viability. With profit margins shrinking and foot traffic dwindling, Hardee’s must navigate a challenging economic landscape to sustain its business and remain competitive in the fast-food market.

In conclusion, Hardee’s faces many challenges ranging from financial pressures and branding missteps to operational inefficiencies and changing consumer preferences. As the company grapples with these obstacles, its ability to adapt and innovate will determine its long-term survival in an increasingly competitive industry.

As reported by Mashed in their recent article