After Nearly 100 Years, Family-Owned White Castle Still Going

Long before there was a McDonald’s, Burger King or Wendy’s, customers feasted on the burgers prepared by White Castle. Its classic white castle buildings adorned cities starting in 1921 when it was started by Billy Ingram.

And to this day, it’s still a family-run business since Billy’s great-granddaughter Lisa Ingram serves as White Castle’s president and CEO. 

But while McDonald’s and the two other burger chains dominate the American landscape, White Castle, with about 375 locations in 14 states, remains a niche chain. By contrast McDonald’s has around 37,800 global locations and Burger King around 13,000.

Despite its relatively modest size, White Castle is holding its own. Its revenue in 2018 rose 1.6%. But most of its revenue growth derives from the products it sells in supermarkets, whose sales rose 23% last year.

While most burger chains proliferate by franchising, White Castle has avoided giving up control. In fact, there are no franchises, though it has two license partnerships with operators who run four outlets in Las Vegas and four in Shanghai.

White Castle is located mostly in the East Coast, Midwest and Florida, though it has expanded out west to Scottsdale, Arizona and Las Vegas, Nevada.

White Castle still offers a value meal as it did when it first started. For example, at a White Castle in Brooklyn, New York, its classic burger, really a slider, costs 85 each, its small French fries $1.99 and small soda $1.99, so that’s a $5 lunch, or $6 for two sliders or $7 for three.

Like most burger outlets, White Castle has introduced delivery. It partners with a slew of vendors including GrubHub, Uber Eats, DoorDash and Postmates.

When this reporter played in a roller hockey league in Bayside, Queens many years ago, he and his teammates would dine at a local White Castle. Some of his teammates scoffed down four or five cheeseburger sliders at a time. Or was it six?

Here’s what Jamie Richardson, vice president of Marketing, based in its home office in Columbus, Ohio, said about its growth.

White Castle is holding its own. Revenue was up a modest 1.8% in 2018. Why?

Richardson: We’re taking a longer view and keeping in touch with what our customers are telling us. They’re still hungry for more sliders and that keeps them happy. We’ve remained relevant for almost a 100 years. But we also offer new products such as the Impossible slider. Our focus is still on great value. You can still get a 10-sack of sliders for around $7, which can be shared by several people.

We don’t hear much about White Castle these days. Why not?

Richardson: I would beg to differ. People are rediscovering the Castle. We’re still family-owned and don’t seek the limelight as much, but social media has been a place where our followers are bigger than our footprint. In fact, we have 1.2 million followers on Facebook. For a relatively small brand, that’s punching above our weight. 

How much marketing does it do?

Richardson: We’re smaller than our bigger competitors so we have to be smarter. We like to say any time is “crave time.” It means we want to invite people to come by when they’re most hungry. We don’t have the budget of big network buys, but we know our customers well. We reach traditional media like TV and radio, but it’s very targeted. We see it as less about marketing and more about conversations. Today more than ever, the next generation of customers is asking for authenticity and that’s something we can claim with a clear conscience.

Authenticity. In what ways?

Richardson: To me the definition is being comfortable in our own skin. We don’t have restaurants in 50 states. We don’t take ourselves too seriously. If someone said that feels corporate, that’s the worst insult we can endure.

What is your niche?

Richardson: Our niche is distinctive food you can’t get anywhere else. The original slider provides a certain comfort and source of good memory that creates a feeling of affinity and coming home, whether that’s at the drive-thru or freezer aisle. We have a presence in all 50 states in grocery stores, where we’re in all major supermarkets like Sam’s Club and Wal-Mart.

How are the burgers prepared?

Richardson: They are steam-grilled on a bed of onions. It’s 100% beef and we put the onions on the grill, then the 100% beef patty on the onions and the bun goes on top to absorb the flavor. Then we top it off with one perfect pickle.

How many new outlets did it open in 2019?

Richardson: We opened three including a large location in Scottsdale, Arizona, our first in that state.

Why such modest growth?

Richardson: So much of our investment these days is in growing sales of consumer packaged goods. We’re adding about three locations a year, including three or five in 2020. We’re also looking into returning to Manhattan, not too far from Times Square, but no lease has been signed.

How are you adapting to consumer tastes for healthier food?

Richardson: We’ve seen the Impossible slider be a welcome addition to our menu, and we have a vegan slider from Dr. Praeger’s. Our cheeseburger slider is only about 160 calories and the burger 140 calories.

You can order a slider for 85 cents. Who does that appeal to?

Richardson: It covers a range. About 90% of our Castles are open 24 hours. After midnight, it goes from White Castle  to Night Castle after a night of reverie. We’re there as an oasis for late-night travelers. In addition, we’re there for hungry families who want great food for a great price.

Delivery is increasing at many restaurant chains. How does it affect White Castle?

Richardson: Our biggest surprise of 2019 was delivery sales. And the biggest challenge is, how do you do that in a way that is more sustainable for your business. The margins are different and that makes it difficult in company-owned restaurants.

You don’t franchise. Why not?

Richardson: Being family-owned, our philosophy has been to not worry about being the biggest, but focus on being the best we can be.

Two years from today, what do you expect?

Richardson: I think the growth will come in marketshare. We don’t expect to add double digit numbers. Our goal is to continue to grow and stretch our overall profitability and business revenue.