LOUISVILLE, Ky. – As officials with Papa John’s International Inc. endeavor to distance the company from its founder and former CEO, John Schnatter, the company announced a new assistance program for franchised restaurants that are part of the North American network of 3,400 stores. The assistance program for domestic franchisees includes cuts in royalties as well as reductions in foodservice pricing and online fees paid by operators through 2018. Franchisees will also be provided funds to support new marketing and image programs as the company moves in a new brand direction
Since Schnatter stepped down as CEO in late 2017, controversy over his current role as the largest stakeholder in the company has continued and its new president and CEO, Steve Ritchie, has committed to adopting programs that will move it forward. The company has lost the support of many corporate partners after the former founder’s public opposition to NFL players protesting during the playing of the national anthem and, more recently, his use of a racial slur during a media training call in July, resulting in his apologetically stepping down as chairman.
“People are at the heart of our business, and this program is one of many actions we are taking to prioritize our team, address the recent challenges and move Papa John’s forward,” said Steve Ritchie, President and CEO of Papa John’s. “I appreciate the open conversation that we have had with our franchisees and the support they have extended, both on this agreement and on the broader operating initiatives we are pursuing to improve performance and build a better future for our company and our stakeholders.”
President of Papa John’s Franchise Association, Vaughn Frey, said despite Schnatter’s resistance, the company is looking forward with optimism. “We believe it is time for the founder to move on. Steve is pursuing the right initiatives to reinvigorate growth and recognizes the importance of working together to move forward successfully. We appreciate the assistance being extended to our franchisees and believe the assistance program will help mitigate the impact that the founder’s inexcusable words and actions have had on franchisees.”
Bill Green, Chairman of the Papa John’s Franchise Advisory Council (FAC), is supportive of the initiative. “We applaud the actions taken by the company to define the future for the Papa John’s brand. The full FAC supports this collaborative agreement as well as other new marketing, technology and operational initiatives the company is taking to move the brand forward.”