Ivar’s, Inc.

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Ivar’s, Inc.

1001 Alaskan Way
Pier 54
Seattle, Washington 98104
U.S.A.
Telephone: (206) 587-6500
Fax: (206) 624-4895
Web site: http://www.ivars.net

Private Company
Incorporated: 1986
Employees: 1,000
Sales: $50 million (2006 est.)
NAIC: 722110 Full-Service Restaurants; 722211 Limited-Service Restaurants

Ivar’s, Inc., has three full-service restaurants—Ivar’s Original Acres of Clams, Ivar’s Salmon House, and Ivar’s Mukilteo Landing—and close to 30 fish bars in Oregon and Washington State. The chain is perhaps best known for its chowder. Ivar’s chowder is on the menu in the Microsoft and Boeing cafeterias, at Sea-Tac Airport, on the Washington State ferries, at almost every university campus in the state, on Amtrak and the Alaska Railroad, at Seattle’s Woodland Park Zoo, and in most high school cafeterias in Washington. It is also for sale in Ivar’s restaurants, Safeway, QFC, and Costco; and at Safeco Field, Qwest Field, Husky Stadium, and Everett Events center. Ivar’s also owns and operates ten Kidd Valley Hamburger locations.

A FISH AND CHIPS BAR GIVES RISE TO A RESTAURANT

In 1938, Ivar Haglund opened a low-budget aquarium on the Seattle waterfront stocked with “exotic sea creatures” that he scooped up from the Puget Sound. The price of admission was a nickel. Shortly after the aquarium opened, two of Haglund’s friends approached him to suggest that they sell fish and chips at his establishment, paying him a percentage of their sales as rent. Haglund agreed, and the first fish bar opened on Pier 54, then called Pier 3.

Haglund, the son of Swedish-Norwegian immigrants, was born in West Seattle in 1905. Performing came naturally to the young Ivar, and he learned to sing and to accompany himself on the guitar. By the time Ivar Haglund opened his aquarium, he was a practiced singer of folk and humorous songs. Soon he was performing on live radio and later on television.

The fish bar eventually closed due to competition with the diner at the other end of Pier 3. However, Haglund discussed the idea of opening a restaurant with his father-in-law, Harry M. Butler. Butler had more than 20 years’ experience operating dining rooms, restaurants, and resorts for the Westin Hotel chain. Butler encouraged Haglund to go ahead with his plan, and Haglund applied for and received a bank loan. The name for Ivar Haglund’s new venture was Ivar’s Acres of Clams, after the last line in one of the songs Haglund sang on the radio called “The Old Settler.”

The original concept for Ivar’s Acres of Clams was to embody a sophisticated waterfront restaurant, employing a French chef, offering a unique menu, and using all new “electric equipment.” This included an electric range, electric fryer, and electric water heater. According to Haglund on the company’s web site, Acres of Clams had a “legitimate, rather than arty, nautical motif, with arresting soft blues and white both inside and out. … The walls [featured] vivid murals of ducks, pheasants, and gulls.”

From its inception, Acres of Clams grew in recognition, becoming a Seattle landmark, helped by its association with the aquarium and by Haglund’s natural ability to draw an audience. Haglund was already known around Seattle for his many and often outlandish promotions for the aquarium. For instance, when Christmas 1940 rolled around, Haglund paraded through Seattle’s public market with a baby buggy decorated with Christmas ornaments. On the buggy was a sign that read “Merry Christmas from Patsy, Baby Seal of the Aquarium,” and inside the buggy was a baby seal. By the time he had reached Santa at one of Seattle’s larger department stores, Haglund had a crowd of spectators following behind him.

In another instance of Haglund’s showmanship, in 1945, a railroad tank car containing syrup ruptured a coupling and spilled, and Haglund donned hip boots, apron, and aquarium hat, and waded into the growing puddle of syrup with a large plate of pancakes and a spoon. To all those who watched, he announced, “Eat at Ivar’s. We don’t skimp on the syrup.”

OPENING AND ACQUIRING NEW RESTAURANTS

Throughout the postwar period, Ivar’s expanded steadily, opening new locations and becoming an established part of Seattle culture. In 1956, it opened Ivar’s Fifth Avenue in downtown Seattle, which became one of Seattle’s classiest and busiest eateries, requiring reservations a week in advance; the company’s flagship, Ivar’s Fifth Avenue was Ivar Haglund’s personal favorite. In 1960, the company remodeled the Fifth Avenue and renamed it the Captain’s Table.

Then, in 1964, Ivar’s changed the concept of the Captain’s Table to more of a casual dining establishment and moved it to a new location with a great view of Elliott Bay. That year also marked the first Ivar’s Fourth of Jul-Ivar’s celebration, which eventually became an established event at Seattle’s Myrtle Edwards Park. The annual daylong event culminated in the largest privately sponsored fireworks display on the West Coast.

A second restaurant, Ivar’s Salmon House, began operations in 1970. The plan for the design of this building was based on a First Nation (aboriginal) long-house typical of the Northwest; the facility eventually won an award from the Historical Society for the authenticity of its replication. The company also moved to focus on the geographic scope of its seafood bars with the purchase of 14 Arthur Treacher Seafood Stores in the mid-1970s. The seafood bars were initially franchised to individual owners under the Arthur Treacher’s name; then in 1984, Ivar’s repurchased all of its franchised seafood bars.

During this time, Ivar’s signed a lease for nearly 300 acres near downtown Port Townsend, on the tip of the Olympic Peninsula, to launch a clam-farming operation. Haglund believed that the Northwest’s big butter clams and horse clams, with their slightly stronger flavor and slightly tougher texture than the deep ocean clams harvested on the East Coast, made a superior chowder, and he determined to supply his restaurants with Pacific Northwest clams for that purpose.

1985–90: METAMORPHOSIS INTO A CHAIN UNDER NEW LEADERSHIP

Haglund died at age 79 in 1985, and the job of heading Ivar’s fell to 35-year-old Scott Kingdon. Kingdon had started out as a fry cook at Ivar’s Alaskan Way fish bar while he attended Green River Community College. He worked his way up to manager in 1970 and eventually moved through the company ranks to oversee all Ivar’s locations. When he took over for Haglund, the company consisted of 14 seafood places and the one-year-old clam farm on the Olympic Peninsula. Kingdon ensured employees that he would maintain the policies and practices set in place by Haglund, and then he set about remodeling and expanding the company’s original establishment. Two years later, the company shuttered the clam-farming operation, which had failed to supply enough clams to meet Ivar’s demands. East Coast clams were simply less expensive and more plentiful.

COMPANY PERSPECTIVES

Ivar’s aims to build a seafood restaurant chain emphasizing mall locations while diversifying into other areas such as retail stores, condiment sales and hamburger chain locations.

Kingdon and his colleagues positioned the company to take advantage of future markets, and Ivar’s metamorphosed into a seafood chain with standardized food preparation processes. The company also began using an automated chowder maker and a computerized machine for smoking salmon and oysters. Nevertheless, management strove to remain true to Haglund’s insistence upon quality; Ivar’s continued to use Alaskan true cod instead of pollack in its fish and chips and increased the size of its fish and chips serving by 30 percent.

Kingdon also continued Haglund’s tradition of over-the-top publicity. In 1985, the larger-than-life-size Dancing Clams began to make appearances throughout the Northwest and California. Humans in “clam suits” entertained people at Mariners’ games, at Seattle’s Children’s Hospital, and at Ivar’s establishments in the Seattle area. The Dancing Clams also made it onto television; in 1991, the company ran a series of Dancing with Clams commercials that spoofed the movie Dancing with Wolves. Specifically, the ads featured Norwegians on horseback watching a Kevin Costner look-alike who danced with giant clams.

Although Orion, maker of the movie, claimed that the commercial constituted copyright infringement and unfair competition, Ivar’s maintained its rights to what it called “pure satire.” “You can’t mistake a clam for a wolf,” insisted Kingdon in a 1991 Wall Street Journal article. The company did temporarily pull the commercials after Orion’s objection, but then began running them again a few months later.

All in all, the late 1980s were good years for Ivar’s. Although sales remained constant at $11 million in 1987 and 1988, the company grew steadily. From 1985 to 1990, it doubled its number of fish bars to 28 and increased its workforce from 400 to 867. Ivar’s also explored new sales territory when it began mass-marketing its tartar sauce. In 1990, the company purchased Kidd Valley, a local hamburger chain known for its fresh Angus beef burgers, made-from-scratch fried onion rings and mushrooms, and ice cream shakes. Ivar’s gained local notoriety for the fact that the Clinton/Gore presidential campaign headquarters in Seattle housed an Ivar’s and called itself “clampaign” headquarters.

In 1991, Ivar’s well-known Captain’s Table restaurant in Seattle closed, marking the end of an era for Ivar’s. Unfortunately, the Captain’s Table had never found its niche after its transformation to a more family-oriented place. It also lost its view of Elliott Bay as traffic picked up on the Burlington Northern railroad tracks that ran between the restaurant and the water. The company purchased the historic Taylor’s Landing restaurant at the Pier One ferry dock about a half an hour north of Seattle after it “faced the option of investing substantial money in the Captain’s Table, which [it] did not own, or investing it in the Taylor’s property,” according to Kingdon in a 1991 Seattle Times article.

Ivar’s Mukilteo Landing had its grand opening in 1992, the same year in which the company unofficially ranked as one of the top 100 privately held companies in Washington. (Unofficially, since the private company would not publicly confirm or deny its annual revenues.) The restaurant did well, although from October 2003 to February 2005, it had to close for renovations after a rogue wave damaged it during a storm that became known thereafter as the Ivar’s Storm.

KEY DATES

1938:: Ivar Haglund opens an aquarium and fish and chip stand.
1946:: Ivar’s Acres of Clams opens.
1948:: The company holds its first International Freestyle Clam Eating Contest.
1956:: The company opens Ivar’s Fifth Avenue in downtown Seattle.
1960:: Ivar’s Fifth Avenue changes its name to the Captain’s Table.
1964:: The first Fourth of Jul-Ivar’s firework shows takes place in Seattle; the Captain’s Table moves closer to Elliott Bay.
1979:: Ivar’s becomes the licensee for 14 Arthur Treacher Seafood stores.
1984:: The company repurchases all of its franchised Seafood Bars and begins its clam-farming operation.
1985:: Scott Kingdon takes over as chief executive after the death of Haglund.
1990:: The company purchases the Kidd Valley Hamburger chain.
1991:: The Captain’s Table restaurant in Seattle closes.
1992:: Ivar’s buys Taylor’s Landing and opens Ivar’s Mukilteo Landing.
1994:: Ivar’s launches a foodservice operation.
2001:: Bob Donegan becomes president and chief executive officer.

NEW DIRECTIONS IN THE LATE NINETIES

Throughout the late 1990s, Ivar’s branched out in new, but related, directions. In 1994, the company launched a foodservice operation, providing its popular and award-winning chowders to the cafeterias at the Washington State ferries, Boeing, Microsoft, and Sea-Tac Airport. The company also began marketing the chowder in such supermarket chains as Safeway, Albertson’s, Fred Meyer, and IGA Stores, as well as online.

After Kingdon died of a heart attack in 2001, the company intended to slow its development for a couple of years. The freeze was in response to the uncertain economy in the Pacific Northwest, and it was hoped it would both reduce stress for the management team and switch focus to an infrastructure enhancement project that would refurbish restaurants and install a new training program. Bob Donegan was named chief executive at Ivar’s. Prior to joining Ivar’s, he had been with Peet’s Coffee and Tea from 1994 to 1997.

Ivar’s was soon looking beyond internal development, however, particularly when the success of its soup and sauce manufacturing business required that it develop a new manufacturing facility. The state-of-the-art facility began production in May 2005. In addition, Qwest Field, home of the Seattle Seahawks, asked Ivar’s to open booths in 2004, while Port of Seattle authorities requested an Ivar’s in the SeaTac terminal in 2005.

In the end, by 2004, the chain had experienced five consecutive years of record growth in sales and profits. Sales for 2004 represented growth of close to 6 percent over 2003 sales and totaled $54.5 million. Sales growth continued in 2005 as the company celebrated its first 100 years, and the company once again began to plan for expansion of its freestanding restaurants. Plans for slow but steady growth continued into 2006 with the opening of one new restaurant and plans for two more in 2007. The company’s online store, called Exclusively Washington, was also adding to the bottom line, offering a variety of food products as well as memorabilia and apparel bearing the popular seafood restaurant’s name and logo.

Carrie Rothburd