What happened to Hot 'n Now? Competition, bankruptcy and now nostalgia

Eric Lacy | Lansing State Journal

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LANSING -- The story of an ultra-affordable fast food chain once hailed for 39-cent burgers, fries and drinks is a complicated one.

It involves an improbable rise in a competitive market, followed by several ownership changes, a dramatic downsizing and bankruptcy filing.

The future doesn't look good for any resurgence of the once thriving Hot 'n Now restaurant chain.

However, the lone remaining Hot 'n Now restaurant, in Sturgis, Mich., keeps finding ways to stay successful with prices and items that spark nostalgia.

"We stuck with it," owner Kees Van Zelst said. "So we're the Last of the Mohicans."

Where is the remaining Hot 'n Now?

Sturgis is about 90 miles southwest of Lansing, which once was considered one of Hot n' Now's hottest markets.

At one point, the Lansing region had six restaurants, including locations in Charlotte and Holt. At the chain's prime, Hot 'n Now had about 100 drive-thru only stores in 15 states, according to the Miami Daily Business Review.

The Netherlands-born Van Zelst, 73, doesn't envision a comeback.

But he's willing to hear offers from ambitious investors.

“We’ll see how things turn out," Van Zelst said. "Maybe I’ll sell it to someone very interested."

Who owns the Hot 'n Now trademark?

It appears, though, that Van Zelst doesn't own the Hot 'n Now trademark.

A State Journal reporter, with help from a Michigan Department of Licensing and Regulatory Affairs official, found filings online that indicate the trademark is owned by BTND LLC of West Fargo, N.D., which renewed it in 2016.

Messages left with Minneapolis-based Theodore Magee, listed as the trademark's "correspondent," weren't returned.

“I don’t know who that is and I will not bring that up," Van Zelst said of the trademark owner. “They don’t bother me, and I don’t bother them. It’s a two-way street.”

Van Zelst said he still enjoys running the Sturgis restaurant with a crew of about 25 employees. It's been open since 1990 and draws about 300 customers daily, he said.

Without dining areas, Hot 'n Now restaurants across the country kept overhead low and lured customers with low prices.

Founder William Van Domelen, of Kalamazoo, created the concept in 1984 and experienced explosive growth with his business model until about 1990.

Then came the chain's downfall.

Hot 'n Now's road to to bankruptcy

Hot 'n Now changed ownership several times and was once owned by Taco Bell Inc. Eventually, its corporate headquarters moved to Holt. The Lansing region's position as one of the brand's top markets and its Michigan ties were among reasons why company officials decided to call Holt home.

Van Zelst said the chain's profitability went south in the mid to late 1990s because the company couldn't withstand the ownership changes and micromanaging.

"When everybody was in charge, nobody was in charge," Van Zelst said.

Hot 'n Now filed for Chapter 11 bankruptcy protection in 2004.

Fourteen months later, a Minneapolis company acquired Hot 'n Now for $175,000. At that time, the franchise had 14 locations throughout Michigan.

How the Sturgis Hot 'n Now continues

In Sturgis, Van Zelst and his staff try to stick with what made Hot 'n Now work during the chain's prime.

There are no longer 39-cent menu items, but patrons can buy burgers, fries and drinks for about $1. Several combo meals are under $5.

Hot 'n Now also offers chicken, fish, popcorn shrimp and surprise seasonal menu items like specialty shakes that are promoted on its Facebook page.

The olive burger, which originated in Lansing, is alive and well.

Charlotte resident Denise Steward, 56, served up plenty of olive burgers at Hot 'n Now restaurants in Charlotte and Holt.

Steward remembers her drive-thru days in the late 1990s fondly. She recalls having to take orders, put food in bags and hand them to customers in 30 seconds or less.

“It was fast-paced," Steward said of the workplace. "But it was very, very interesting and enjoyable.”

Van Zelst still pushes his employees to meet the 30 seconds or less goal.

Nostalgia for the Hot 'n Now peak

High standards, affordable prices and a family atmosphere drew Delta Township resident Jackie Franke, 54, to the company in the 1990s.

She was Hot 'n Now's human resources manager at its Holt headquarters.

Franke recalls that her position covered 1,300 employees spread out at about 40 stores. Management mixed with restaurant workers well and often participated in training exercises, including taste tests, she said.

The mushroom burger stemmed from an idea shared among staff, she said.

"We loved what we did,” Franke said.

Franke worked at the Hot 'n Now headquarters when the company was owned by Ron Davis, a Connecticut investor. Ron Levondosky, of Holt, was vice president of operations at the time.

Davis bought Hot 'n Now in 1997 from Taco Bell, a subsidiary of PepsiCo Inc., after the chain struggled to take off nationally.

Franke is convinced Hot 'n Now would be successful if it came back as a chain.

"I absolutely miss it," Franke exclaimed.

Others also appear to be believers.

Nostalgia for Hot 'n Now prompted Van Zelst to start selling T-shirts and bumper stickers a few years ago.

Van Zelst sells bumper stickers for $1.50 and shirts for $15. Van Zelst said he feels "really, really great" to know people still believe in his business.

Early Thursday afternoon, a Hot 'n Now bumper sticker was available on eBay for $14.99. The same website had a seller offering a T-shirt for $50.

"We stuck to our guns and decided to give good, quality service and cleanliness," Van Zelst said of his philosophy since 1990. "I think it's paid off in the long run."

Several videos, blogs and food restaurant review websites have paid tribute to Hot 'n Now and its business model created by founder William Van Domelen.

Van Domelen died in 2015. His obituary posted on the Betzler Life Story Funeral Homes website said he sold Hot 'n Now in 1990 "to focus his time and energy on blessing others."

One of the last Hot 'n Now restaurants, located in Bay City, shut down on Labor Day 2016. A grease fire caused at least $20,000 of damage, according to the Bay City Times.

A radio host's Hot 'n Now road trip

Intrigued by its fandom and still cheap food, Eric Meier, a Kalamazoo radio host, went to the Sturgis restaurant and captured his trip on YouTube in 2016.

To date, Meier's food review has drawn over 15,000 views.

Meier, 41, hails from Benton Harbor. He visited the Hot 'n Now store in Charlotte often when he was a Central Michigan University student traveling to and from home along Interstate 69.

In Sturgis, the Hot 'n Now burgers and fries tasted exactly like he remembered.

"I always thought olives were gross as a kid." Meier said. "But you know what? An olive burger was a buck and a quarter, and once I ate one I thought, 'Whoah, that was pretty good!”

The Sturgis Hot 'n Now Facebook page appears to be a popular spot for hungry fans.

It has close to 4,000 likes and a restaurant rating of 9.4, based on the opinions of over 200 visitors.

Hot 'n Now employees occasionally post specials, including deals on fried mushrooms, cheese fries, fried pickle spears and clam strips.

Each item runs for about $2.

The page also includes "cheese teasers" references from fans. This tator tot-like snack filled with cheese is a Hot 'n Now staple.

Said Meier of Hot 'n Now's Sturgis survivor, "It’s nice to know that it’s there if you ever need it."

Eric Lacy is a reporter for the Lansing State Journal. Contact him at 517-377-1206 or elacy@lsj.com. Follow him on Twitter @EricLacy.