Chi-Chi's

Chi-Chi's is a Mexican-restaurant chain operating in Belgium, Luxembourg, Austria, the United Arab Emirates, and Kuwait by Tumbleweed, Inc.[1] The chain also once operated in the United States and Canada but exited those countries in 2004. Currently Chi-Chi's is also a brand of Mexican-themed grocery foods (later purchased by Hormel) with an emphasis on salsa.

Chi-Chi's
IndustryRestaurants, grocery products
FateBankruptcy (as restaurants in the U.S. and Canada)
Founded1975 (1975)
Richfield, Minnesota, U.S.
DefunctSeptember 18, 2004 (2004-09-18) (as restaurants in the U.S. and Canada)
ProductsMexican food
ParentHormel
Websitewww.chichis.com

History

Founding

Chi-Chi's was founded in 1975 in Richfield, Minnesota, a suburb of Minneapolis, by restaurateur Marno McDermott (his wife's nickname was "Chi Chi"[2]) and former Green Bay Packers player Max McGee. MacDermott had previously founded the Zapata fast-food Mexican chain, which later became Zantigo.[3] From 1977 to 1986, the chain was run by former KFC executive Shelly Frank.[4] When Frank took leadership, the chain moved its headquarters to his hometown of Louisville. By March 1995, the chain had grown to 210 locations.[5]

Management and marketing

In 2001, Chi-Chi's applied for a trademark[6] on the word "salsafication" but was denied by the Trademark Trial and Appeal Board. The company's slogans were "A celebration of food" and, later, "Life always needs a little salsa."[3]

Bankruptcy, hepatitis A, and closure in United States and Canada

Chi-Chi's last owner while the company was still in business in the U.S. and Canada was Prandium Inc., which had filed for bankruptcy several times, including in 1993 as Restaurant Enterprises Group Inc. and again in 2002 as Prandium.[7] On October 8, 2003, Chi-Chi's and Koo Koo Roo, another Prandium subsidiary, filed for Chapter 11 bankruptcy themselves.[7]

In November 2003, a month after filing for Chapter 11 bankruptcy, Chi-Chi's was hit with the largest hepatitis A outbreak in U.S. history, with at least four deaths and 660 other victims of illness in the Pittsburgh area,[8] including high school students who caught the disease from the original victims.[9] The hepatitis was traced back to green onions at the Chi-Chi's at Beaver Valley Mall near Monaca, Pennsylvania, about 30 miles (48 km) northwest of Pittsburgh.[10] Chi-Chi's settled the hepatitis A lawsuits by July 2004.[11] At the time the suits were settled, Chi-Chi's had only 65 restaurants, fewer than half of the number of four years prior.[12]

In August 2004, Outback Steakhouse bid $42.5 million[13] for the rights to buy its choice of Chi-Chi's 76 properties, but did not purchase the Chi-Chi's name, operations, or recipes.[14] On the weekend of September 18, 2004, Chi-Chi's closed all 65 of its remaining restaurants.[12] Outback had hoped to convert many of the properties to its own restaurants, but instead eventually sold the majority of the properties to Kimco Realty Corporation, a real estate investment trust company in New Hyde Park, New York.[15]

Chi-Chi's master franchise now belongs to a Swiss company which franchises Chi-Chi's in Europe, the Middle East, Asia, and North Africa, the best-represented country being Belgium, with 3 units.[16]

Grocery brand

Hormel Foods, which had bought the rights to use the Chi-Chi's brand on grocery items, continues to produce Chi-Chi's salsa and related products, and uses the chichis.com domain name to market them.[17]

See also

References
  1. "Chi-Chi's Brand FAQ". Hormel Foods. Retrieved 2017-11-20.
  2. "Chi-Chi's Inc. - Company Profile, Information, Business Description, History, Background Information on Chi-Chi's Inc". www.referenceforbusiness.com. Retrieved 2017-08-21.
  3. "Chi-Chi's Inc". Funding Universe. Retrieved 2008-10-09.
  4. Schoifet, Mark (January 27, 1986). "Frank exits Chi-Chi's, plans early retirement". Nation's Restaurant News. Retrieved July 2, 2010.
  5. Benmour, Eric (June 14, 1996). "Chi-Chi's closes oldest store here as pullback continues". Business First of Louisville. Retrieved July 2, 2010.
  6. "Salsafication trademark application" (PDF). Trademark Trial and Appeal Board. Archived from the original (PDF) on 2006-10-03. Retrieved 2007-05-16.
  7. Spector, Amy. Nation's Restaurant News.' October 20, 2003. FindArticles.com.
  8. "Hepatitis A outbreak claims its 4th victim". Deseret News (Salt Lake City). April 4, 2004. Archived from the original on August 12, 2017. Retrieved October 24, 2007.
  9. . "Hepatitis A outbreak spreads to students". Deseret News (Salt Lake City). December 14, 2003. Archived from the original on 25 December 2016. Retrieved 25 December 2016.
  10. "Business at Beaver Valley Mall Chi-Chi's nearly back - Pittsburgh Post-Gazette". Pittsburgh Post-Gazette. February 15, 2004.
  11. . Nation's Restaurant News. July 12, 2004. FindArticles.com. Accessed October 24, 2007.
  12. Lockyer, Sarah E. (October 4, 2004). "Chi-Chi's Inc. said adios last month and shuttered till 65 of its Mexican dinnerhouses as Outback Steakhouse I". Nation's Restaurant News.
  13. "Outback to Buy 76 Chi-Chi's". The Ledger (Lakeland, Florida). 5 August 2004. Retrieved 25 December 2016.
  14. "Outback Steakhouse to rebrand Chi-Chi's". USA Today. 23 September 2004. Retrieved 25 December 2016.
  15. "Chi-Chi's plans $35.2m sale of outlets, leases". Nation's Restaurant News. 5 July 2004. Archived from the original on 29 April 2014.
  16. "Chi-Chi's". Chi-Chi's Belgium.
  17. CHI-CHI'S FAQ Accessed 25 December 2016.
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