Does Little Chef have a future?

For decades, Little Chef restaurants have been a familiar site at the side of British motorways and main roads. Its first site -- consisting of a tiny food bar with 11 seats -- was opened in Reading in 1958, the same year as the UK's first motorway came into use.

From Little Chef to big business

As the number of motorways and motorists boomed between the 1960s and the 1980s, so too did Little Chef and its familiar mascot, the plump, cheery chef known as 'Fat Charlie'.

With millions of British families 'popping out for a drive' on weekends, Little Chef and its American-style diners became a mainstay of roadside eateries, attracting millions of customers every year. At its peak in the 1980s (after taking over its main rival Happy Eater in 1986), Little Chef had grown to more than 230 branches.

The chain was probably best known for its all-day breakfast, of which food critic Egon Ronay said: "It’s called all-day because it tastes as if it has been hanging around all day."

But over time, like high-street chains Beefeater and Harvester, Little Chef's old-fashioned British meals came to be seen as boring. With British palates becoming more sophisticated and diners looking to healthier alternatives, Little Chef started shrinking.

Left by the wayside

Little Chef has never again reached the heights it scaled in the 1980s. Over the next three decades, the chain suffered as Brits' driving and eating habits changed.

Increasingly, drivers wanted to grab a bite and head off again, rather than sitting down to full table service. What's more, thanks to a lack of investment, its restaurants became shabby, old-fashioned and known for a dull menu, thus putting off passing customers.

After several changes of management and failed revamps, including six different owners in 30 years, Little Chef went into administration in December 2006. Within days, it was bought by private equity investors RCapital Partners for a price tag below £10 million.

Business-turnaround specialists RCapital then set about pruning Little Chef down to size, closing dozens of restaurants and laying off hundreds of workers. Notably, in January of 2012, RCapital announced plans to close 67 of its 161 restaurants, scrapping up to 600 jobs.

Heston rides to the rescue

Facing stiff competition from pub restaurants and global fast-food chains such as Burger King, Starbucks and McDonald's, Little Chef turned to Michelin-starred celebrity chef Heston Blumenthal for help.

In January 2009, Heston appeared in a Channel 4 documentary series in which he launched a new menu and refit at the Little Chef in Popham, near Basingstoke in Hampshire. The trial proved to be a great success, rolling out across a number of Little Chef restaurants. 10 new sites opened in 2011.

At the same time, Little Chef modernised its image by taking to Facebook and Twitter to create a digital brand. As well as its usual table service, the group now offers an Express take-away service and 'Good to Go' deli-style offerings. These and other improvements led Little Chef to announce a year-on-year rise in food sales of nearly half (47%) in May 2011.

Flash in the pan or new dawn?

Six years after being rescued by RCapital, what's left of Little Chef today is a core group of 83 restaurants, all trading profitably.

This week, these revamped restaurants have been put up for sale, with KPMG appointed to find a buyer. Interested parties are said to include motorway service station chains Moto and Welcome Break. Other potential buyers include fast-food giants, coffee-shop chains such as Costa Coffee and Starbucks, plus convenience-store chains.

Clearly, there's still life in Little Chef yet, as it employs 1,100 staff to serve more than six million customers a year. However, years of financial engineering, under-investment and asset stripping had left it a pale shadow of its former self.

As it happens, Little Chef is already heading for yet another rebrand, this time at the hands of Manchester design agency We Are Creation. Before tinkering with its menu again, this agency should remember that greasy fry-ups oil many British drivers. Indeed, Little Chef sold more than a million Olympic breakfasts last year alone.

For me, in order to avoid going back to the days of shabby-looking sites beside 'A' roads and motorways, Little Chef's new owners must concentrate on the basics. What is needed is a Marks & Spencer-style approach to roadside restaurants: Providing a variety of fresh food (hot and cold) at affordable prices.

Ideally, what Little Chef really needs is a cash-rich new owner to pour money into the group, reinventing it as a 21st Century convenience-style chain of eateries. Perhaps Marks & Spencer or Tesco would make sympathetic owners, given their success with the M&S Simply Food and One Stop chains respectively?

What do you think of Little Chef?

Are you pleased that Little Chef has survived and thrived during the worst UK recession in living memory? Would you have mourned Little Chef's passing if one more tired restaurant brand had gone under?

Have you eaten at a Little Chef in recent years? If so, what did you think of the menu and the food quality? Would you visit Little Chef again, or give it a miss next time? What advice would you give to the chain's next owners?

Please share your thoughts on Little Chef in the comments box below.