PETERSON
Tom Gannam  /  AP
Eric Peterson, director of product development, holds a Hardee's 'Monster Burger' in the CKE test kitchen. The 'Monster Burger' and the other thick burgers in Hardee's lineup are the main reason for the company's resurgence.
updated 3/30/2005 4:34:46 PM ET 2005-03-30T21:34:46

In the fast-food equivalent of a research-and-development department, Hardee’s is trying to build a better — and perhaps more colossal — burger.

The test kitchen on the top floor of a downtown office tower already has turned out gargantuan fare like the "Monster Thickburger." With researchers who try out ingredients like onion-flavored mayo and jalapenos, St. Louis-based Hardee’s hopes to take its burgers to an even higher level of culinary decadence.

There is much at stake in this kitchen: It is where the once-flagging food chain began its turnaround by creating an arsenal of ever-bigger combinations of beef and bun. Hardee’s expects to roll out a new burger every few months, so the test kitchen must keep producing — especially since it can take from nine months to a year for a product to go from the idea stage to actual sales in Hardee’s restaurants.

Presiding over this laboratory is Bruce Frazer, the chief of research and development for CKE Restaurants Inc., the California-based parent of Hardee’s Food Systems. The job means Frazer inevitably ends up as one of his own test subjects.

“I have every intention of not trying six versions of a burger, but I always do,” said Frazer, who manages to carry just 160 pounds on a 5-foot-9 frame despite the high-fat, high-calorie food his staff concocts.

CKE expects such efforts to translate into higher sales and profits. And in recent years, they have — CKE’s stock has been rising since early 2003, when it fetched just $3.10 on the New York Stock Exchange, to its current level of around $16, a five-year high.

The test kitchen by design emulates a typical Hardee’s cook site, complete with a charbroiler near “quality assurance” workers weighing and measuring chicken strips.

One recent afternoon, they showered a reporter with samples to taste, from a piping hot basket of French fries with the potato skins still on to a Frisco Thickburger, complete with onion-flavored mayo like the original.

“Give this a try,” Frazer said, handing over a Spicy BBQ Thickburger spiked with Texas Toothpicks — spicy, batter-fried slivers of onions and jalapenos added for an extra kick.

A couple of bites of this hot concoction drew sweat to the forehead.

There are the occasional flops, including the “smoked sausage burger” and the French onion burger.

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“Each step is a hurdle, and the product can fall off at any point,” said Brad Haley, the company’s executive vice president of marketing.

Army of tasters
Hardee’s has an army of food tasters for these would-be menu items. With a library about 700 e-mail addresses of downtown workers, every few weeks the company invites some to a free lunch in exchange for a critique.

High fat content hasn’t been a problem — Hardee’s has found its niche being a contrarian. As restaurants scrambled in recent years to satisfy the health-conscious, Hardee’s put its test kitchen to work, perfecting Thickburger incarnations fetching $2.39 to roughly $5.

Last November, Hardee’s debuted the double-patty, four-strips-of-bacon "Monster Thickburger" — a 1,420-calorie, 107-grams-of-fat behemoth that got plenty of notice from late-night talk show hosts and critics. One health advocacy group dubbed Thickburgers “food porn.”

Frazer and others at Hardee’s flick off such criticism, saying they’re only giving consumers — namely “young hungry guys” ages 18 to 34 — what they crave.

And it seems that customers do indeed crave big, fast food, and Hardee’s and its rivals will keep on serving them. This week, rival Burger King introduced the "Enormous Omelet Sandwich," a 700-plus calorie breakfast item that includes two eggs, a sausage patty, two slices of cheese and three strips of bacon on a bun.

It’s no surprise, then, that the recent success of Hardee’s has been largely due to its Thickburgers — Angus beef burgers up to two-thirds pound. They take longer to cook than more typical fast-food burgers, but Hardee’s says they’re better food that’s worth the wait. Hardee’s introduced the Thickburger family in April 2003, perhaps not coincidentally about the time the company’s stock started its upward march.

Now available in 10 varieties, the Thickburger has helped propel Hardee’s to 21 straight months of same-store sales gains, those from stores open at least a year; such sales are considered the best gauge of performance. The average Hardee’s store had $862,000 in sales in the past fiscal year, an 11-year high.

With the added cash, CKE has slashed its long-term debt from $628 million in fiscal 2000 to $259.6 million as of last fall. Hardee’s sites — now numbering more than 2,000, mostly in the Midwest and Southeast — also feature streamlined menus and have undergone sweeping makeovers in everything from decor and service.

“We’re moving from a turnaround story to a growth story,” says Andy Puzder, CKE’s president and chief executive. “We don’t have big debt killing us, and don’t have our brand failing so miserably that it’s dragging the company down.”

Analysts have echoed that. In a research report in early March, Roth Capital Partners’ Anton Brenner reiterated a “strong buy” recommendation on the company’s stock, and notes the company’s focus now “is shifting to growth and expansion.”

Frazer’s job is clearly to help that growth.

“We try a lot of things to find the one that really clicks,” Frazer said. “America’s palate is evolving, and as long as we keep up with that we’ll be in good shape.”

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