2 Popular Restaurant Chains Are Merging Into One And The Reason Couldn't Be Clearer

Frugal diners are always searching for the perfect menu on a budget, but in an economy full of so many struggling restaurant chains, attaining that goal isn't always easy. However, diners might soon get quite the dynamic duo from two famous restaurant chains working together as one. The first dual-branded IHOP and Applebee's restaurant opened in Seguin, Texas, in February 2025.

The Hill Country border town restaurant is located just 35 miles outside San Antonio, and 52 miles from Austin, off a busy interstate. The Applebee's | IHOP location features two branded entrances into a single shared dining room with separately branded seating areas and signage. However, regardless of where they sit, customers are able to order from each restaurants' established menus, as well as certain location-exclusive crossover items, from breakfast time until the late-night hour. 

Dine Brands, the parent company of both chains, sees the breakfast-focused IHOP and pub-like Applebee's as complementary rather than competitive chains. By building a supergroup out of the two, Dine hopes to make beautiful music (and money) for franchisors and franchisees, as well as provide a tasty value to customers. The co-branded Seguin location has been in the works for some time, and is the first of a dozen similar sites planned to open across the U.S. in the coming year.

In an era where beloved restaurants are facing bankruptcy, an iconic diner chain is closing dozens of locations, and even Hooters is reportedly on the decline, "fun" may be the furthest thing from a nervous restaurant brand's mind. But the combination of Applebee's and IHOP restaurants create a sense of fun with a holistic approach to operational optimization.

Guests of the Applebee's | IHOP combo restaurant can play around with which side of the restaurant they prefer to dine in, while enjoying the awesome ability to order both IHOP classic Cinn-a-Stack pancakes and Applebee's signature "riblets" in one fell swoop. Plus, the Seguin location features special crossover dishes that combine elements of each brand's dining appeal into one dish, like the Buffalo Chicken Omelette or Ultimate Breakfast Burger. Plus, special cocktails on offer play with the new night-and-day theme of both restaurants, including espresso martinis and Irish coffee.

But it isn't all fun and games at the dual-branded restaurants: it's also smart business. IHOP's peak service is in the morning, dropping off by early afternoon. Applebee's peak service happens during the evening, but is fairly dead when its core demographic is busy working. Both chains have struggled in the past, largely as a result of slowing consumer spending — due to issues like inflation and wage stagnation. However, by combining offerings that draw from a shared kitchen, served by a cross-trained staff, the co-branded stores can cover service all day (and night) long, and double the restaurant's revenues per store square footage.

Dine Brands hopes to domestically replicate the already-established success of a handful of these international dual-branded Applebee's and IHOP stores. In fact, co-branded locations in Dubai, Canada, Mexico, and beyond have all already proven successful enough for Dine to invest in the experiment stateside. "We had a methodical approach," Dine CEO John Peyton told National Restaurant News, before adding, "We opened almost 20 overseas, spent two years doing it, and learned a lot of lessons we're bringing forward [to the U.S.] about the menu, physical design, operations, technology, we did focus groups. We wouldn't be doing this if we didn't think it was a good idea." Peyton also mentioned that there is a waitlist for potential franchisees, as well as an 11-point process for those ultimately selected for franchise development.

The Seguin location franchise owner, Danny Hakim, told SeguinToday.com, "As an operator, the thing that intrigued me the most was you can hit all day parts." Hakim also explained, "The restaurant will be busy and when a restaurant is busy, it's a great environment for the employees, the customers, everyone because it means the employees can work at any time of the day. They can make their money." Indeed, one location providing a hub for breakfast, brunch, after-work drinks and game-night dinners might seem like a distant dream — but for franchisees and diners alike, it could become the reality of "come hungry, leave happy" and "eatin' good in the neighborhood."