Operations
Papa Johns senior VP of development talks growth, sales increases
Papa Johns new store openings have been the best the brand has experienced in the past five years. Editor Mandy Detwiler talks to the company's new SVP of development to learn what's behind the growth.
November 15, 2023 by Mandy Wolf Detwiler — Editor, Networld Media Group
The year 2023 has been a banner one for Papa Johns, which the brand said will go down as "one of the best new-store opening years in the last five years." Earlier in the year, the brand committed to opening 650 units in India in the next 10 years.
Sales have increased 3% in North America in Q3 as well. Pizza Marketplace reached out to Patrick Coelho, the brand's newly-minted SVP of development, in an email interview to learn what's driving the growth and the challenges he's facing in his new role. He took the role this past July and brings with him past experiences with Burger King and Scooter's Coffee.
Q: Can you provide an overview of Papa John's growth and performance in 2023, especially with a focus on the 3% increase in North America comparable sales in Q3 2023 compared to the previous year? What factors do you believe contributed to the increase in North America comparable sales in the third quarter of 2023? How has international growth influenced Papa John's net unit openings in the second and third quarters of 2023?
A: In the first three quarters of 2023, Papa Johns achieved a combined 119 net-unit openings with more in the works for the remainder of the year. Strong execution by our teams and franchisees led to solid system-wide restaurant sales growth in Q3 2023, and menu innovation, revenue management enhancements and continued growth in our third-party aggregator channel contributed to our year-over-year sales growth in the third quarter.
Papa Johns remains a sought-after brand globally — earlier this year we announced an expanded partnership to open 650 new restaurants in India by 2033. The vast white space development opportunities we have available in North America and internationally provide an attractive and unique opportunity for franchise candidates looking to grow with our leading pizza brand.
Q:Can you share insights into the challenges and opportunities you've encountered in your role since starting in July?
A:For opportunities, Papa Johns is ready for growth. We have spent the last few years building a solid foundation for growth acceleration. We have an iconic brand, amazing products, supported by a strong team, in addition to the competitive advantage of having prime white space markets available for development. We are eager and ready to support accelerated franchise growth, especially in the U.S.
In terms of challenges, it's no secret that the cost of building new restaurants is a sore spot for many brands and concepts; however, our focus on flexible restaurant formats, cost-effective design and equipment packages, and our ability to deliver attractive unit economics to franchisees help us mitigate these issues. Our franchise partners are excited to join us in a very intentional push toward growth acceleration in North America.
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Photo: Papa Johns |
Q:How do your past leadership experiences at Scooter's Coffee and Burger King inform your approach to development at Papa John's? What specific responsibilities and goals are associated with overseeing the company's North American restaurant real estate development activities?
A: My time at Burger King and Scooter's helped me cultivate a high growth mentality and provided me the opportunity to structure different development programs designed to support high volume of franchise growth. My focus at Papa Johns is to refine the growth strategy and execute it, the goal being to bring us back to the similar growth levels to what we experienced in the back half of the 1990s. We've done it once, and I certainly believe we can do it again.
We have a strong brand, amazing products, great franchisees, an attractive model and tons of space to grow across the U.S. and Canada. To achieve this, we are focused on igniting several development engines, including attracting new, growth-oriented franchisees into the brand to capitalize on the opportunities available in prime markets. Over the years, I have worked with many different franchise groups and developed a good way to differentiate non-growth franchisees from developing, growth-oriented franchisees. It takes a lot to be a successful multi-unit developer while maintaining strong operations of existing restaurants. You need development experience and resources to build out a development infrastructure. It's certainly not for everyone, and we are partnering with the franchisees that fit these criteria.
Alternatively, there are some partners who lean on us through our Development Services Program, which provides the development infrastructure and expertise to those who want to grow but don't have the experience or resources to build out a development infrastructure.
Q:Can you explain the concept and design of the new Epic Dough restaurant prototype? What motivated the development of this new restaurant prototype, and how does it enhance the customer experience? How does the smaller design of the Epic Dough restaurant model align with Papa John's brand? Could you describe the key features of the open kitchen in the new restaurant prototype, and how it contributes to the overall experience for guests?
A:The Epic Dough prototype, and our international format that was launched in 2023, aligns with our growth strategy by enhancing the customer experience and helping us stay ahead of the competition. We're investing in technology, menu innovation, and store design to make our restaurants more inviting and convenient for customers. The new design was inspired by the thought and quality we put into our products — it represents fresh ingredients through our color palette, textures, and light throughout the space. It also features an open kitchen design where guests can see the dough made fresh and pizzas individually handcrafted.
We take a versatile approach to our floor plans, considering it as a kit of parts that can be efficiently adapted to spaces ranging from 900-1500 square feet. By collaborating with our operations teams, we have identified key pieces of equipment that maintain high volume while occupying less space compared to larger alternatives. This adaptability is crucial in a competitive real estate market, as it enables brands to effectively adapt without compromising operational efficiency and throughput.
About Mandy Wolf Detwiler
Mandy Wolf Detwiler is the managing editor at Networld Media Group and the site editor for PizzaMarketplace.com and QSRweb.com. She has more than 20 years’ experience covering food, people and places.
An award-winning print journalist, Mandy brings more than 20 years’ experience to Networld Media Group. She has spent nearly two decades covering the pizza industry, from independent pizzerias to multi-unit chains and every size business in between. Mandy has been featured on the Food Network and has won numerous awards for her coverage of the restaurant industry. She has an insatiable appetite for learning, and can tell you where to find the best slices in the country after spending 15 years traveling and eating pizza for a living.
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