GROWING CHAIN OF GEMS RUBY'S PLANS AMBITIOUS 60-SITE EXPANSION.

Byline: Brent Hopkins Staff Writer

Ruby's Diners, the bygone-era-theme hamburger hangout, plans to triple the number of restaurants in the next five years, including three new spots in the San Fernando Valley area.

Company founders Doug Cavanaugh and Ralph Kosmides, who opened their first location on the Balboa Pier in a dilapidated bait shop 20 years ago, plan on growing the concept dramatically. After two decades of slow, measured growth that gave the 1940s-style chain 38 stores spread across eight states, the restaurateurs have set their sights on adding 60 by 2007, with locations planned in Burbank, Northridge and Thousand Oaks. Expansion specialist Fred LeFranc signed on to manage the growth, looking to mimic his success in bulking up El Torito, where he added nearly 200 restaurants.

``We've hit the point where Doug and Ralph thought it was time to step it up,'' said LeFranc, the chain's chief operating officer. ``Things are going very well. With the way the economy has gone back to patriotism, we've been really benefiting. We've gotten this way with no advertising, just giving our guests a quality experience.''

The diners got a triple boost in recent months, with the feel-good, All- American image appealing to customers' patriotic fervor, homey fare tapping into a revived interest in comfort food, and low prices appealing to budget-minded consumers. Restaurants open more than a year have seen their sales grow 6 percent companywide and chainwide revenue climbed to $75 million last year.

The expansion plans should prove easily attainable, according to restaurant analysts familiar with the chain's efforts.

``The first year will probably be a little slow, but it will pick up by the third year,'' said consultant Randall Hiatt, president of Costa Mesa-based Fessel International. ``If they get several active franchisees developing two to three units a year, they could pick those numbers pretty quickly. It would be the largest expansion in Ruby's history. They've bolstered their corporate staff and they're ready.''

The trick to managing the expansion lies in maintaining quality, said Andy Harris, producer of KABC-AM's (790) ``The Restaurant Show.'' With half the stores corporate-owned and in close reach of the hands-on founders, the chain has built its reputation on quality and consistent service.

``If you have the choice of Denny's or Ruby's, most people who are savvy about food pick Ruby's because the food's a little better and it's fun,'' Harris said. ``Where Denny's has a very corporate feel, Ruby's still has an entrepreneurial feel. They're not just on every corner, they feel unique.''

A feeling that LeFranc wants to preserve, starting with that shiny, polished image that's proved a boon to business, both in the past year and the 19 that preceded it.

``We're a values-driven company,'' he said. ``We try to be very wholesome, clean-cut and fun. No tattoos, no piercings, we just want good kids working for us. That uniform and look evokes an era that appeared to be simpler.''

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3 photos

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(1 -- color) Ruby's Diner in Woodland Hills, one of 38 locations in eight states, will be joined by branches in Northridge, Burbank, Thousand Oaks and 57 other places across the country as the chain implements a five-year expansion plan.

(2 -- color) Brandon Seigel serves up shakes at Ruby's Diner in Woodland Hills, where clean-cut 1940s style is the order of the day.

(3 -- color) Comforting nostalgic images line the walls of Ruby's Diner at the Westfield Shoppingtown Promenade in Woodland Hills

Joe Binoya/Special to the Daily News