The former CEO of Papa John’s Pizza claims that the company is facing a decline due to bag management, poor food quality and more, according to Fox Business.
Schantter, who founded the company in 1984 claims that the business is staying afloat due to the pandemic.
He explains the issue at hand are, “lackluster pizza quality, limited pizza experience among leadership, the loosening of COVID restrictions on other competing dining options in the coming year, food cost pressures (as recently noted in Domino’s Q3 earnings release), and negative store growth in the U.S.”
“COVID-related sales increases beginning in March have been masking the deficiencies I noted above,” Schnatter writes.
“And when our economy, and more importantly the dining sector, likely returns to some sort of normalcy in 2021, it’s very likely these recent sales gains will fall by the wayside just as the virus itself likely will.”
“With strong momentum and our potential expanding every day, we are investing in capabilities for future innovation and global growth, improving efficiencies, and better aligning our organization around the strategies that are driving our near- and long-term success,” Rob Lynch, Papa John’s president & CEO, said in a recent statement.
From Fox News:
The coronavirus pandemic has been a boon for restaurants that cater to convenience, and Papa John’s hasn’t missed out, as the company’s stock is up 23% year to date.
But Schnatter writes in Seeking Alpha that his former company, which he founded in 1984, is buoyed by the demand for quick and easy delivery during the pandemic.
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The article he wrote Tuesday was a response to another bearish take on Papa John’s that says the franchise “has benefited from a rising tide this year, not its own execution.”
According to Schnatter, when the economy returns to normalcy following the coronavirus pandemic, these problems could cause the bottom to fall out.