TravelCenters of America Rethinks Its Approach to Foodservice

WESTLAKE, Ohio — Nearly a year after welcoming customers back at some of its full-service restaurants, TravelCenters of America Inc. (TA) is taking a closer look at its foodservice offerings and rethinking its approach. 

Speaking during the company's first-quarter 2021 earnings call, held May 4, CEO Jonathan Pertchik reported that the Westlake-based travel center operator continues to reopen its full-service restaurants cautiously and carefully, while exploring alternative operating models and other foodservice brands.

At the same time, TA is making progress on its 2019 pact with IHOP Restaurants to open up to 94 IHOP locations over the next five years inside TA and Petro branded locations across the United States. Currently, TA has five IHOP conversions underway, each of which costs approximately $1.4 million per site. These locations are expected to open in the third and fourth quarters this year.

"We are wrapping up customer segmentation, as well as brand and restaurant design work, on parallel with having conversations with other brands," Pertchik said. "It is highly likely we will not end up with a one-size-fits-all approach for our full-service restaurants as we are beginning to conclude that different locations and markets have different demands and preferences, and we are designing an overall strategy and plan around those local and regional differences to achieve the best and most profitable overall result."

As it explores other models, TA completed the sale of its standalone restaurant business for $5 million in April. The transaction included 41 locations primarily branded as Quaker Steak and Lube, as Convenience Store News previously reported. 

"This business did not fit strategically within our long-term goals for the company and absorbed a disproportionate amount of company-wide energy relative to financial results. The sale will allow us to focus our efforts on our core travel center business," Pertchik said.

As COVID-19 spread across the country, leading states to issue stay-at-home directives, TA closed its full-service restaurants in March 2020. The company began reopening the locations with a reduced capacity in June 2020.

"In a strange way, COVID gave us an odd opportunity to understand this most labor-intensive part of our business, and I just want to make sure across the portfolio of 160-plus full-service restaurants, that we really get it right," the chief executive said.

TA's travel center network is comprised of more than 270 locations in 44 states and Canada, principally under the TA, Petro Stopping Centers and TA Express brands. It also operates more than 600 full-service and quick-service restaurants and nine proprietary brands, including Iron Skillet and Country Pride.