Denver-bound

Cuckoo's Chicken House and Waterin' Hole looks to open franchises

by Chuck Slothower
Herald Staff Writer Cuckoo's Chicken House & Waterin' Hole is looking to open several franchises, including at least one in the Denver area, in a plan that will test whether the Durango restaurant's success can translate to other cities.

A Cuckoo's employee, Christopher Calagias, and the business' owners are looking at possible Denver-area locations for the popular Durango eatery.

Locations under consideration include the Highlands Park area of Denver, the Invesco Field area and the Boulder-Louisville area, Calagias said.

Calagias is just one of several people interested in opening a Cuckoo's franchise, said Chris Redding, who owns the business with his wife, Michele.

"We've been in business for 10 years, and our plan right from the very beginning was hopefully to franchise our idea," Redding said. "Ten years later, I think we're finally going to do it."

Cuckoo's formed a limited-liability company, Cuckoo's Franchising, on June 15, according to state records. Redding brought in a Denver law firm and a franchising consultant to help with the launch.

"Realistically, we're looking at trying to sell three to five franchises a year," Redding said. "We don't want to grow too fast. Our focus is certainly on the success of the franchise."

Cuckoo's is five to six weeks away from registering with the state and federal governments as a franchising entity.

"Once that takes place, we'll be able to disclose our franchise offering," Redding said. "We can start negotiations at that point with the interested parties."

Franchises could open about six months from then, Redding said.

Redding declined to disclose his franchise fee, saying it may change. But typically, franchise fees range from $20,000 to $50,000 in the restaurant industry, he said.

Cuckoo's was founded in 1999 at 128 E. College Drive, next to the Abbey Theatre. The restaurant has gained a local following for its wide range of chicken wings and multiple TVs for sports viewing.

Calagias said Cuckoo's success should be easy to replicate in Denver.

"Everything works in that restaurant so well and it's so basic to run," he said.

Denver County has seen 57 restaurants apply for liquor licenses since December 2008. The records do not count restaurants that do not apply for liquor licenses.

Calagias has worked at Cuckoo's for three years. He has also helped manage the Palace Restaurant and also worked at Sushitarian.

The Durango restaurant industry appears to have turned a corner after a tough start to 2009. Sales-tax revenues from restaurants rose 2.25 percent in March compared with the same month last year. The tax, collected in April, reflects sales in March.

Redding said Cuckoo's remains profitable despite the economic downturn.

"We did notice a little slowdown, but even as of May and so far in June, we're up over last year," he said.

Redding said he and his wife intend to stay in the business.

"We're in it for the long haul," he said.

chuck@durangoherald.com