Franchisee plans to expand Rally’s Hamburgers brand in Kentucky

Rally's Hamburger was founded in Louisville by businessman Jim Patterson. | Wikimedia Commons

Rally’s Hamburgers was founded in Louisville by businessman Jim Patterson. | Wikimedia Commons

Louisville resident Joe Hertzman joined the Rally’s Hamburgers business on the ground floor.

He signed a franchise agreement with the then-Louisville-based company in 1985, the year prominent restaurateur Jim Patterson founded it. A year later in 1986, he opened his first store.

“When Jim started Rally’s, we jumped on board pretty early,” Hertzman said, noting that his father was friends with Patterson and was a Long John Silver’s and Jerry’s Restaurant franchisee. “I’ve been around here through thick and thin.”

Hertzman also owns Zishi, a hair removal and skin care spa at 9000 Taylorsville Road, and he co-owns 25 Papa John’s restaurants with his brother Allen Hertzman.

During the past few decades, Joe Hertzman opened 13 Rally’s stores in central and southwestern Indiana and western Kentucky, but he’s wanted to operate in the Louisville and Lexington markets. When Rally’s first began however, those markets were populated with company-owned stores.

About 16 years ago, Rally’s merged with Florida-based Checkers Drive-In Restaurants, and the resulting company, called Checkers, decided to sell its Kentucky and Southern Indiana stores. Franchisee David Miller bought the 23 stores, which are spread around Louisville, Lexington, Southern Indiana and Richmond, Ky.

“It sold for considerably more than I was willing to pay at the time,” Hertzman said, adding that he told Miller: “When you are ready to sell, come knock on my door.”

Last year, Miller was ready, and in February, Hertzman acquired the 23 stores, along with the right to develop those markets.

“We are very excited to be in this position where we are looking forward to great things happening,” he said. “Not only have we picked up a great market here and in Lexington, but we have a number of managers and crew members who have been involved in the Rally’s brand for years.”

The purchase brought Hertzman’s Rally’s store count to 36 and Rally’s employee count to more than 800.

Although he has yet to sign a new development deal with Checkers, he anticipates opening one new store a year. Hertzman also plans to invest in renovating most of the stores he just bought.

“We want to make it like brand spanking new. …The brand is so strong here, but there’s not been one store opened in the past 15 years,” Hertzman said. Remodeling will “give some energy and a new face to the brand.”

He declined to say how much he paid for the stores or how much renovations will cost, but he expects the changes will result in double-digit same-store sales increases. Same-store sales at his 13 stores collectively rose more than 50 percent during a five-year period, Hertzman said.

“We expect to gain through improved operations and through improved appearance of our buildings,” he said.

His leadership team, husband and wife Darren Haggard and Dawn Haggard, are retraining employees, and Hertzman has revived an old-school cooking technique to improve the quality of food. Rather than keeping hamburger patties warm in a special piece of equipment, the patties are served hot of the grill.