Domino’s Quarterly Sales Surge but Pandemic Costs hit Earnings; Shares Tumble

But earnings fell short of expectations, hurt by higher costs, and its shares fell more than 6% in morning trading. The stock, which has a market value of $15.8 billion, has risen 36% so far this year. Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

Earnings per share: $2.49 vs. $2.79 expected

Revenue: $968 million vs. $953

The pizza chain reported fiscal third-quarter net income of $99.1 million, or $2.49 per share, up from $86.4 million, or $2.05 per share, a year earlier. Analysts surveyed by Refinitiv were expecting earnings of $2.79 per share. While the pandemic lifted sales, it also boosted costs for the company. Higher wages for front-line workers, personal protective equipment, and enhanced sick pay cost the company an estimated $11 million. And increased sales also resulted in higher compensation based on performance. Volatility in the commodity markets caused by the crisis pushed ingredient prices, including cheese, 3.8% higher. Net sales rose 17.9% to $968 million, topping expectations of $953 million. U.S. same-store sales rose 17.5%. The company said that sales in its home market were “positively impacted” by changes to customer behavior as a result of the pandemic. Customers were choosing delivery over carryout, which tends to carry a higher ticket. Loyalty memberships have also accelerated during the pandemic, and more customers have stuck around. Domino’s also released new and improved chicken wings during the quarter. Executives said that they haven’t run any promotions on the new menu item because they’re already flying off shelves. Its international business reported same-store sales growth of 6.2%. As of Oct. 5, fewer than 300 of Domino’s international locations are temporarily shuttered. During the quarter, the company permanently closed 126 restaurants, primarily in India. Domino’s added 83 net new locations. In early September, Domino’s had 17,256 locations worldwide. CEO Ritch Allison said that the company is reassessing whether it will be able to reach 25,000 stores globally by 2025. According to him, unit growth remains a challenge because of the pandemic and related construction and permitting delays. But he said it was more of a question of timing than if demand really requires so many locations. In the second quarter, due to the uncertainty caused by the crisis, Domino’s borrowed $158 million under its variable funding notes. It has since repaid that debt. Domino’s will hold a virtual investor event on Nov. 12.—Source: CNBC.

How one Town is Helping its Restaurants Survive

Like communities across America, the New York City suburb of Port Washington, N.Y., saw its restaurants—nearly all of them locally owned independents—struggling to survive under capacity limits set by the state to protect residents from COVID-19. Few local places offered patio dining before the pandemic, and the inline configurations of many were a limit on their outdoor dining options. At most they could squeeze a table or two into the sidewalk space. But what it did have was an abundance of recreational space for its 16,000 or so residents, including a spacious public dock where residents could fish, launch their kayaks, borrow a book from the pocket library on site, or just take in the views of the water, as many routinely do on temperate days. And that gelled into an idea as elected officials and local business leaders brainstormed ways of helping local merchants, including the town’s 50 or so restaurants. “Some of the biggest ideas are ones that are easy,” remarks Judi Bosworth, supervisor of the Town of North Hempstead, the township that incorporates Port Washington and similar bedroom communities about a 40-minute train ride outside of New York City. Restaurants needed space, and the dock had plenty of it. “It was just a matter of putting out some benches, some spots where people could eat.” The township paid for the picnic tables and popped for a sign that listed all of the local restaurants, along with their phone numbers and a QR code that called up the establishments’ websites or menus. A second sign explained that locals could have food delivered from the restaurants, most of which had added self or third-party delivery during the crisis, and have a meal delivered dockside. “It’s not a big investment,” says Bosworth. “It has been very successful, and because of the overwhelmingly positive feedback, the Chamber [of Commerce] has asked us to extend it into the fall.” Similar setups have been adopted for other towns in the township, with similarly positive results, she says. The key, according to Bosworth, was the collaboration and constant dialogue with neighborhood restaurants and other local business leaders. “Here’s the thing: These situations are so fluid,” she says. “What’s a good idea today might not be a good idea tomorrow, and what’s a not-so-good idea today may be great tomorrow. So you have to keep talking.” As the weather cools and dockside dining may no longer be feasible, “we’re going to continue talking.” Meanwhile, she offers this advice to hard-pressed restaurants and sympathetic town officials elsewhere: “If you see a good idea that some municipality came up with, steal it.” Source: Restaurant Business.

Winners Chosen in Chicago’s Outdoor Dining Design Contest

Cozy cabins and heated tables are among the winning ideas announced Thursday as part of a design contest in Chicago to develop solutions to extend the city’s outdoor dining season. The city-sponsored contest, which began in August, drew 643 submissions, including humorous offerings such as generating warmth by heating up urban rats. Judges from design firm IDEO and the city of Chicago narrowed the field to 26 finalists. The three winners, who will each receive $5,000, were selected for their feasibility and safety by a panel of restaurant owners, chefs, servers, and architects.

Here’s a look at the winning design ideas:

Block Party: from entrant Neil Reindel, an urban designer, and planner, is billed as a flexible outdoor dining solution that can fit into a variety of locations. It features cube-shaped modules that can fit in parking lanes. The modules can be added to each other to suit more diners. The cubes are outfitted with radiant heating units and they are open to allow for air circulation.

Cozy Cabins: the winning entry from Amy Young, features adjoining open-front “cabins” with radiant floor heating. The structures are designed to fit within the footprint of a standard parking space. The cabin’s design was inspired by ice fishing huts, Young said, with transparent windows to allow for social distancing while also offering a feeling of community. The concept was created by design firm ASD | SKY.

Heated Tables: submitted by graphic designer Ellie Henderson, is modeled off of the common Japanese Kotatsu table. The heated tables are typically used to keep warm indoors but can be modified for outdoor use. The traditional tables are made up of an electric heater attached to the underside of the table. A blanket is draped over the frame, with another flat surface placed on top to keep the blanket from catching fire. The heated tables would allow for full air circulation to prevent the spread of the coronavirus.  Source: Restaurant Business.

Blaze Pizza Names New CMO and Chief Restaurant Officer

Blaze Fast-Fire’d Pizza has expanded its executive ranks with the appointment of Vince Szwajkowski as chief marketing officer and Rick Gestring as chief restaurant officer, the company announced. The Pasadena, Calif.-based fast-casual pizza brand earlier this year added Marie Zhang as chief supply chain officer and Ed Yancey as vice president of franchise development on its corporate team. Szwajkowski succeeds Shivram Vaideeswaran as CMO, and Gestring succeeds Jim Bitticks as chief restaurant officer, a spokesperson said. “I am absolutely thrilled to be adding world-class marketing and operations leaders to the Blaze executive team,” said Mandy Shaw, CEO of Blaze Pizza. in a statement. “Both Vince and Rick have extensive experience in building culturally relevant brands and evolving the guest journey. I’m confident that they will be pivotal in taking us into the next stages of growth.” As chief marketing officer, Szwajkowski, left, is responsible for the development, planning, and execution of all digital, marketing, and brand strategy. Prior to Blaze, Szwajkowski worked with ArcLight Cinemas and Hilton. At Hilton, he helped create and lead the global hospitality brand Motto by Hilton, a new category of lifestyle hotels. “Blaze has built its reputation on disrupting the pizza space through its unique customer-centric concept and devoted following,” Szwajkowski said. As chief restaurant officer, Gestring, left, oversees restaurant operations and innovation, across both corporate and franchise units. Before Blaze Pizza, Gestring was at Dunkin’ Brands, leading aspects of operating systems and guest experience in more than 8,500 locations. He also worked with Arby’s. “Culture is so important to me; and at Blaze, culture, and purpose is at the core of everything we do,” Gestring said. “I’m inspired by the people behind the pizza, and the journey we are embarking on together with our guests and franchisees.” Blaze Pizza, backed by private-equity firm Brentwood Associates, ended fiscal 2019 with nearly 320 U.S. units, according to THEE Nation’s Restaurant News Top 200. The Top 200 survey reported Blaze Pizza with $367 million in U.S. systemwide sales for the year ended December 2019.  Source: NRN.

Square is Bringing Online Ordering to in-Person Dining

Technology has been crucial to restaurants looking to meet the demand for online takeout ordering during the COVID-19 crisis, and Square Inc. is betting that the in-person dining experience is also ripe for a high-tech upgrade. The company announced Tuesday that it was rolling out a QR-code feature that would let diners scan a code on their tables to place orders. The code will automatically take diners to a mobile version of the restaurant’s website, where people will be able to choose items and have their orders sent to the kitchen. Square SQ, +2.06% said in a release that the feature is meant to create a safer ordering experience because diners won’t have to interact with waiters to place their orders. The feature could also improve efficiency because diners can pay for their meals on their phones, order whenever they’re ready, and ask for drink refills digitally, according to the release. Square argued that the feature could help dining establishments turn over tables more quickly by reducing the wait times that typically occur when people are ready to order or pay but don’t yet have the attention of their servers. The company is making the feature available for free to sellers who are using its Square Online platform, which lets businesses create online stores and accept payments via Square.  Source. Market Square.

Tik Tok  Proves Potent Marketing Channel for some Restaurants.

Ever heard of Charli D’Amelio?

If you’re not on TikTok—the fast-growing, video-based social media platform—chances are you haven’t. At least not prior to Sept. 2, when Dunkin’ launched a collaboration with the 16-year-old TikTok megastar—and immediately broke its record for daily active app users. “On launch day, we saw a 57% increase in Dunkin’ app downloads in comparison to our previous 90-day average,” said Drayton Martin, vice president, brand stewardship, for the Canton, Mass.-based coffee chain, in an email. D’Amelio, a dancer and New England native, has more than 90 million TikTok followers, making her the most-followed account on the platform. The centerpiece of her partnership with Dunkin’ is a new drink called The Charli: cold brew with whole milk and three pumps of caramel swirl—D’Amelio’s go-to order and a fixture in many of her videos. Dunkin’ sold “hundreds of thousands” of them in the first five days; cold brew sales rose 20% on the first day and 45% the next, Martin said. The eye-popping results highlight the potential marketing power of TikTok, now one of the most downloaded mobile apps in the world. It has about 800 million monthly active users worldwide, an 800% increase since Jan. 2018, according to the company. And a significant portion of those users are teenagers: As of June, nearly a third were between the ages of 10 and 19, according to Statista. The app is young, having been introduced in the U.S. in 2018, and still relatively small compared to other social media giants such as Facebook, with 2.7 billion monthly active users. It has also faced concerns over privacy and national security in the U.S. Most recently, President Trump threatened to ban TikTok unless Chinese parent company ByteDance divested from its U.S. operations. (That doesn’t seem to have stopped people from using it, though.) All that could be part of the reason restaurants have yet to take to it in earnest. Chipotle Mexican Grill was the first major restaurant bran to launch a TikTok account, in May 2019. Dunkin’ joined last October, and Wendy’s, Taco Bell, and Little Caesars also have accounts. “I think people want to get it right,” said Tressie Lieberman, Chipotle’s VP of digital and off-premise marketing, when asked why more restaurants don’t use TikTok. “It’s a platform that you need to show up in the right way,” she said, adding that brands can’t just copy/paste content from their other social media channels. The app, with its own vocabulary and memes, has a learning curve, but Chipotle seems to have cracked the code. The Newport Beach, Calif.-based burrito chain has more than 1 million followers, and has seen views of Chipotle-related content grow fourfold—from 22 million to 92 million—since the beginning of 2020, Lieberman said. The chain’s sole goal with TikTok is to engage with Gen Z consumers. Recent posts include a montage of baby boomers mispronouncing “Chipotle” and a list of reasons to work at Chipotle. (Reason No. 4: “You get this fire hat.”) As of Thursday, the boomer post had more than 13 million views. TikTok has been particularly useful for simply observing what people are saying about Chipotle, which in turn helps inform its content, Lieberman said. “There’s just so much content [on TikTok], and it’s a different expression of content. It’s just a different level of access and learning than you can get from other platforms,” she said. For restaurants thinking about joining TikTok, listening, and sharing is a good place to start, Lieberman said. “You can find some of the best content coming from your fan base, and then you can share that content,” she said. Much of the TikTok ecosystem revolves around viral “challenges.” Chipotle capitalized on this last summer with its lid flip challenge, prompting users to post videos of themselves flipping their burrito bowl lids atop the bowl. It generated more than 100 million views and a record-breaking digital sales day for the chain. Ultimately, the idea is to drive sales, “but in a really unique and engaging way,” Lieberman said. “Most of our content is built on just creating that relationship with the brand,” she said. “You can talk about things that are sales drivers, you just need to talk about it in a way that’s authentic to the platform.” Dunkin’ has also found success embracing TikTok’s particulars, including challenges and “content that feels homemade vs. polished,” Martin said. “No rinse and repeat content from other channels,” she said. “Go all in on what makes TikTok special.” Growth on the platform isn’t necessarily reserved for big brands, which can afford paid promotions and partnerships. Brandon Murphy, a 23-year-old kitchen manager at Liberty Hall Pizza in Lambertville, N.J., has accumulated more than 200,000 followers with fairly straightforward videos of himself making pizza in the restaurant’s wood-fired oven. His very first post, from last February, has more than 8 million views. “I was joking with my boss, ‘Oh watch, this will go viral,’” he said. “A thousand views is what I was expecting.” When his shift ended five hours later, the video had already reached the 50,000 marks. Murphy said he has spoken with TikTok, which credited his surprising success to the fact that “a lot of people are on TikTok” and Murphy is “just a real person, doing real things.” In June, TikTok revealed some of the details behind what determines which videos show up in user’s feeds, including a user’s past interactions and the content of the video such as captions or hashtags. “Neither follower count nor whether the account has had previous high-performing videos are direct factors in the recommendation system,” TikTok said. Liberty Hall has seen at least some business impact from its TikTok exposure—mostly teenage customers saying they’d seen Murphy’s videos. “Not a huge impact,” he said, “but every person counts.” His advice for restaurants is to keep it simple. “Don’t try to force it,” he said. “I’m not out there doing anything crazy. … Trust that the video will rope people in and see that and want to go themselves.” And both Chipotle and Dunkin’ emphasized moving fast to find out what works. “Don’t wait for a perfect strategy,” Martin said. “See what sticks and continue to build off of that.”  Source: Restaurant Business.

Cleaning, Sanitizing, Disinfecting, what’s the Difference?

The Centers for Disease Control and Prevention and the Environmental Protection Agency have released comprehensive guidelines outlining how to keep restaurants and other foodservices running safely. There’s a wealth of information on how to properly clean, sanitize, and disinfect different parts of your establishment. Here’s a quick roundup of what these steps mean that you can share with your staff.

Cleaning

Cleaning physically removes dust, dirt, spills, stains, and other unwanted matter from surfaces. Cleaning should always come before sanitizing and/or disinfecting.

Examples of cleaning include:

Wiping down tabletops, seats and menus to clear off crumbs, spills and smudges

Dusting lighting fixtures

Wiping down kitchen work surfaces, sweeping floors

Scrubbing pots and pans with soap and water

Cleaning does not kill pathogens.

Sanitizing

Sanitizing follows cleaning and helps to reduce the number of microorganisms such as bacteria and germs to below levels deemed safe by the CDC. Sanitizing is an effective preventative practice since it inhibits the growth of harmful bacteria and reduces the number of germs on a surface. Note however, that sanitizing does not kill all viruses (you need to check the label of the sanitizer and work with your sanitizer provider to ensure its effectiveness). Food-safe sanitizers can be used on any surfaces that come into contact with food. Most sanitizing products tell you to allow the sanitizer to air dry for 30 seconds on the surface. Food-prep surfaces should be sanitized multiple times per day, including:

Cutting boards

Countertops and work surfaces

Food contact equipment

Disinfecting

Disinfectants kill bacteria and viruses on hard, non-porous surfaces. The EPA currently recognizes disinfecting as most effective way to kill viruses like the coronavirus, so it’s important that you not only clean high-touch points but also regularly disinfect them.

Key areas and points to disinfect multiple times a day (or ideally, between uses) include:

Doorknobs, railings, light switches

Bathroom surfaces, faucets, sinks, toilets

Menus, ATMs

POS systems, keyboards, phones

Tables, takeout stations

Drink machines

When it comes to disinfectants on food contact surfaces, you might want to err on the side of caution and not use them for this purpose as some are approved for food contact surfaces and some are not. Disinfectants must never come in direct contact with foods. You must make sure users read the product label and you can ask your supplier to provide proper training in the use of the disinfectant you purchase during shift meetings. The EPA has released a list of approved disinfectants for use against the coronavirus. Again, read the label of a product to ensure you are using it on the proper type of surface in the right way and are aware of any special directions when applying the product. The EPA’s List N goes into detail on the types of surfaces on which you can safely use a disinfectant product. Click the green plus sign next to a product’s registration number and look at the Surface Type.

You can use certain products on surfaces that touch food, such as dishes, cooking utensils, and countertops if it includes the phrase “Food Contact.” If it doesn’t, it’s not safe for these surfaces.

Sometimes the product’s directions will require you to rinse the surface after disinfecting—List N/Surface Type will read Food Contact Surfaces, Post-Rinse Required.

When it’s not necessary to rinse after using the disinfectant, it will read Food Contact Surfaces, No Rinse.

The CDC has provided guidance for cleaning and disinfecting effectively.

Wash your hands thoroughly and wear disposable gloves and any other personal protective equipment that is recommended on the bottle of the disinfectant you are using.

Clean visibly dirty surfaces with soap and water.

Use appropriate cleaning or disinfectant product in the proper concentration and dilution as listed on the label.

Follow the directions on the label to determine the contact time or amount of time that the disinfectant should remain wet on the surface to ensure the product has time to act, and follow instructions about rinsing or wiping the surface after disinfecting.

Wash your hands thoroughly after using the disinfectant.

And always keep disinfectants locked up.  Source: The National Restaurant Association.

163 Closed Pizza Hut Locations Owned by NPC International are up for Sale

Roughly 163 Pizza Hut leases have gone up for sale as part of NPC International’s bankruptcy restructuring. The bids for the currently shuttered restaurants in 26 states are due by Oct. 23, according to New York-based A&G Real Estate Partners, the firm handling the auction. The firm is advising NPC International, which filed for Chapter 11 bankruptcy in July. At the time of the filing, Leawood, Kan.-based NPC International operated more than 1,600 Wendy’s and Pizza Hut restaurants. In August, NPC began the process of selling a portion of its Pizza Hut business. It also closed up to 300 Pizza Hut restaurants. Thus far, there have not been any Wendy’s closures, NPC said.

The locations range in size from 1,000-square-foot takeout and delivery-only restaurants to full-service restaurants that run nearly 6,000 square feet. The majority are freestanding locations in neighborhood shopping centers and regional open-air centers.   “With attractive rents and more than 80% of the leases offering extended option terms, these sites provide compelling opportunities for established and start-up foodservice and other retail operators seeking to expand in desirable suburban, urban and exurban markets across the U.S.,”  A&G Senior Managing Director Joseph McKeska said in a statement. A listing of the individual leases is available at www.agrep.com A&G is also working with NPC to optimize the company’s real estate portfolio of more than 1,000 Pizza Hut and Wendy’s locations that remain in operation. NPC, Pizza Hut’s largest franchise operator, said the COVID-19 pandemic exacerbated the company’s existing challenges such as increased labor and commodities costs. The company is also highly leveraged.  After striking an agreement with Yum Brands, the parent of Pizza Hut, NPC closed about 300 unprofitable Pizza Hut restaurants, most of which were dine-in restaurants.  The brand, which was struggling prior to the COVID-19 crisis, was moving away from its legacy red-roof restaurants in favor of stores that focus on carryout and delivery.   Source: NRN.

Golden Corral Franchise Group 1069 Restaurant Group LLC files Chapter 11 Bankruptcy

Golden Corral Corp.’s largest franchise group, 1069 Restaurant Group LLC, has filed for Chapter 11 bankruptcy protection, citing the impact of COVID-19 pandemic closures. Winter Park, Fla.-based 1069 Restaurant Group, which franchises 33 units of the Raleigh, N.C.-based buffet chain, said in its petition Monday that only six locations are open for dine-in service among its restaurants in Florida and Georgia. The petition also said the company hopes to open another 18 restaurants by the end of 2020. “Leadership will continue reviewing underperforming locations for potential closure and/or sale where appropriate,” the company told the court. “Debtors expect to reject at least six leases in the very near term.” The filing, in the U.S Bankruptcy Court for the Middle District of Florida’s Orlando division, cites liabilities of between $50 million and $100 million and assets of $10 million to $50 million. The largest listed creditor is Regions Bank of Alpharetta, Ga., for a $9.4 million Paycheck Protection Program loan. The company said it closed all its Golden Corral units on March 16. The parent company in late March suspended operations at 35 company-owned buffet units as a result of the coronavirus pandemic. The 1069 Restaurant Group and its affiliates said in the bankruptcy filing that “during April through July 2020, the companies considered numerous restructuring options and negotiated with various creditor groups as to past due obligations.” However, the company said, pandemic continued to influence national and state public health policies with both Florida and Georgia substantially easing restrictions and giving 1069 Restaurant Group a chance to increase operations. “The pandemic is creating enormous disruption throughout the economy, and the restaurant industry as a whole is especially affected,” the company said in its filings. The 1969 Restaurant Group LLC is a division of Holm & Holm Corp. Inc., which is owned by Eric and Diane Holm.  Source: NRN.

Ruby Tuesday Declares Bankruptcy

The company said it reached an understanding with its secured lenders to support restructuring. However, court documents show that Shawn Lederman, chief executive officer of Ruby Tuesday, said that 185 restaurants will be closed due to the coronavirus (COVID-19) pandemic. The company still has 236 other company-owned and operated locations along with a number of locations owned by 10 franchisee groups. “This announcement does not mean ‘Goodbye, Ruby Tuesday,’” Mr. Lederman said. “Today’s actions will allow us an opportunity to reposition the company for long-term stability as we recover from the unprecedented impact of COVID-19. Our restructuring demonstrates a commitment to Ruby Tuesday’s future viability as we work to preserve thousands of team member jobs.” The company is one of many restaurants that has struggled with revenues during the pandemic due to restrictions on indoor dining. Other recent restaurant chains to file for bankruptcy include Golden Corral, Sizzler USA, California Pizza Kitchen, and Chuck E. Cheese. Ruby Tuesday operates in 45 states, the District of Columbia, 14 countries, and Guam.

No ‘Qualified’ Bidders for California Pizza Kitchen in Bankruptcy Asset Sale

An Oct. 8 auction to sell the assets of California Pizza Kitchen Inc., which filed for Chapter 11 bankruptcy in July, was canceled because there were no qualified bidders, according to court documents filed this week. “This was always a potential scenario that we had planned for and are still on track to exit the Chapter 11 process on an expedited timeline. Additionally, our liquidity position is strong and we are focused on our strong business momentum which includes continuing to open new locations across the globe,” the company told Nation’s Restaurant News in a statement released Friday. Over the summer, the Playa Vista, Calif.-based company and 7 affiliated debtors each filed for voluntary bankruptcy protection in Bankruptcy Court for the Southern District of Texas. The sale of the company, which has been majority-owned by Golden Gate Capital for nearly a decade, was among two company restructuring plans submitted to the court. The other plan was to work with lenders to reduce its $403.1 million in debt to $174 million. Prior to filing for bankruptcy protection and before the onset of the pandemic, the struggling chain had explored a potential sale that included “outreach to sixty-one parties and a broad universe of relevant strategic and financial parties,” according to court documents. At that time, four of 30 interested parties sent the company “indications of interest and/or proposals.” “Ultimately, the COVID-19 pandemic severely interrupted the marketing process,” the company said in a Sept. 24 court document. At the time of the bankruptcy filing, California Pizza Kitchen had permanently closed several underperforming locations across the country and had successfully negotiated lease concessions totaling $6.1 million over the next three years, according to court filings. A hearing date to consider approval of the company’s bankruptcy plan is set for Oct. 29. California Pizza Kitchen was founded in 1985 in Beverly Hills, Calif. The brand referred to as CPK, became a wildly successful casual dining chain known for its modern take on pizza. It’s legendary The Original BBQ Chicken Pizza has since been copied by rivals. CPK grew through franchising and investments from a variety of partners over the years which included Pepsi and Buckmann, Rosser, Sherrill & Co. It was a publicly-traded company for a number of years before Golden Gate Capital acquired CPK in a “take-private” transaction in 2011. At that time, CPK had about 265 restaurants. Today, the brand has about 200 locations.  Golden Gate Capital indirectly owns more than 89% of the shares in the company, according to court documents. – Source: NRN.

Papa John’s Names New CFO

Steve Coke, interim principal financial and accounting officer, will continue in his role as vice president of investor relations and strategy. Ms. Gugino brings to the role more than 20 years of financial management, planning, and strategic expertise. Most recently, she was senior vice president of financial planning and analysis at Target Corp. Previously she spent 18 years at Patterson Companies, Inc., including four years as executive vice president and CFO. At Papa John’s, she will be responsible for building and implementing the company’s long-term plans for profitable growth and shareholder value creation. “After a careful search for a candidate whose values, passion, and expertise align with Papa John’s core values and business needs, I’m thrilled to welcome Ann Gugino to our team,” said Rob Lynch, president, and chief executive officer of Papa John’s International. “Ann is a proven leader and change agent, who brings deep experience in the consumer and retail sector, including driving demand and profitability across digital and traditional commerce at Target. “Ann’s appointment rounds out one of the most capable and diverse leadership teams in our industry. The breadth and depth of our team’s strengths, backgrounds, and perspectives are crucial advantages for Papa John’s and essential to our long-term innovation and growth plans.” – Source: Food Business News.

PPP Forgiveness Process Begins

Restaurants who received funding from the Paycheck Protection Program (PPP) may soon learn if their loans have been forgiven. The U.S. Small Business Administration (SBA) began processing applications for forgiveness on Friday, with some lenders already being forwarded funds to cover loans to restaurants and other small businesses under the $670 billion program, according to a spokesman. Many restaurants who received funds have been awaiting word on whether their loans will essentially be treated as outright grants, with no need to repay the aid. Otherwise, borrowers will be charged 1% interest and expected to repay the principal, which could run as high as $10 million. Loans granted before June 5 carry a two-year term. Loans extended afterward, during the second flight of PPP funding, have a 5-year window. Repayment is deferred for six months. Some restaurant filers say they reached out to their lenders for a sense of the forgiveness timeframe, only to learn that the financial institutions had not yet been informed of the schedule by the SBA or its parent agency, The PPP, the major form of assistance extended to small businesses by the federal government, was conceived as a way of helping small-enterprise employers like restaurants keep their staffs on the payroll as the pandemic shut down the economy. To have their loans forgiven, recipients were initially required to spend up to 75% of the funds on employee compensation, and to use the money within eight weeks. Under heavy lobbying by the National Restaurant Association and other industry groups, Congress expanded the use time to 24 weeks, and dropped the payroll requirement to 60%, meaning 40% of the funds could be used for rent or operating expenses. The program proved an essential lifeline for restaurants. Nearly 50,000 restaurants received loans of at least $150,000, according to analysis be Restaurant Business. The identities of operations receiving less than that amount were not revealed. The money was intended for small businesses. But eight of the restaurant recipients rank among the Top 100 chains as ranked by systemwide sales. About a third of the brands ranking within the Top 500 were listed on SBA records as recipients.

All told, restaurants and hotels received 8% of the funds lent by the SBA under the PPP or about $41 billion in total. Four other industries received a larger aggregate amount. The average amount provided across all PPP loans was $105,000, according to the SBA. In total, $517 billion was extended via 4.9 million loans, leaving about $135 billion in funding unused.

Another PPP?

The start of the forgiveness approval process comes as the fate of the PPP remains in question. A bill passed by the House of Representatives would allocate additional funds to restart the program, which stopped accepting applications on Aug. 8. But the measure hit a brick wall in the Senate. On Tuesday, President Trump directed White House subordinates to cease negotiations on a compromise measure until after the election. After winning a second term, the president said, he would immediately push through an aid package that helps small businesses. Last night, Trump tempered his opposition to some forms of federal aid. He tweeted, “The House & Senate should IMMEDIATELY Approve 25 Billion Dollars for Airline Payroll Support, & 135 Billion Dollars for Paycheck Protection Program for Small Business. Both of these will be fully paid for with unused funds from the Cares Act. Have this money. I will sign now!” Some supporters of a re-up have favored a refunding of the PPP through a separate and less-controversial bill that Congress might be willing to pass before recessing for the election. – Source: Restaurant Business.

The company’s past troubles inspired change throughout the organization . . . .

Denny’s Diversity and Inclusion Efforts Go Back Decades

In the mid-1990s, Denny’s faced class-action lawsuits that accused the company of discriminatory actions. The family-dining leader agreed to pay more than $54 million to settle lawsuits filed by thousands of black customers who claimed they were refused service or forced to wait longer or pay more than white guests. At the time, Deval L. Patrick, head of the civil rights division of the Justice Department called it the largest and broadest settlement under the Federal public-accommodation laws. In all, more than 4,300 claims were filed. The story catapulted Denny’s to the forefront of a growing conversation over racial issues in the workplace. In 1995, it formed a diversity team and implemented new training practices. It also made a concerted effort to recruit minority employees and empower voices up and down the corporate ladder. By 2000, Denny’s earned the top ranking in Fortune’s “America’s 50 Best Companies for Minorities.” It fronted the list the following year, too. Today, diversity remains a top-flight issue across the country for companies of all sizes—heightened to hyper levels by headline events, like the deaths of George Floyd and Breonna Taylor, and the Black Lives Matter movement. While diversity and inclusion initiatives represent relatively recent practices for some companies, Denny’s has been at it for decades. Rather than just put the 1990s incident behind it, the company shifted focus entirely. About two-thirds of Denny’s present workforce is made up of minority groups, including half of restaurant management-level employees. The company’s board consists of 44 percent of minorities and 33 percent women. Additionally, Denny’s has spent more than $2 billion with diverse and disadvantaged suppliers since it introduced a Supplier Diversity Program in 1993. Last year, diverse and disadvantaged businesses represented 14.1 percent of Denny’s total purchases. Michelle Hunt, a 25-year Denny’s vet, serves as Denny’s director of supplier diversity. April Kelly-Drummond, head of diversity, equality, inclusion, and multicultural engagement, who has also been with Denny’s for more than 25 years, and Fasika Melaku, VP of learning and development, chatted with FSR about Denny’s efforts on the inclusion topic, why they’re critical today, and how the company can continue to make progress. After the class action lawsuit of the 90s, what steps did Denny’s take to improve diversity, equity, and inclusion efforts? – Source: fsrmagazine.

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