Global Talent War Means 6-Month Wait for Domino’s Pizza: Retail

October 30, 2011

Global Talent War Means 6-Month Wait for Domino’s Pizza: Retail

Leslie Patton and Jeff Green
Oct. 14, 2011 (Bloomberg) — Domino’s Pizza Inc. can get a pizza to your house in less than 30 minutes. It took the company six months to find the right person to lead its international expansion.

Restaurant chains including Domino’s, AFC Enterprises Inc. and Dunkin’ Brands Group Inc. are hunting for executives who can adapt menus to international tastes and navigate foreign regulations. Such changes may accelerate as chains expand overseas amid slowing U.S. growth, said Guy Cote, who leads restaurant-executive searches for Heidrick & Struggles International Inc. in Miami.

“We’re twice as busy as we were 18 months ago, and there’s a war for talent right now,” Cote said in an interview. U.S. restaurant sales declined 2.8 percent in the two years through 2010, while sales at dining establishments in China jumped 46 percent in the same time, data from researchers Technomic Inc. and IBISWorld Inc. show.

Demand for talented executives is so high that Domino’s had to go outside the restaurant industry for its newest international executive, former Bain Capital LLC partner Richard Allison. The pizza chain searched for six months and closed the deal during a Valentine’s Day dinner at The Chop House restaurant in Ann Arbor, Michigan, where the company is based, Chief Executive Officer Patrick Doyle said in an interview.

Allison, 44, will help the chain, which has more than 4,500 stores outside the U.S., open as many as 300 stores annually, with most being overseas, Doyle said. “In 2012, we will reach the point where we have more stores and more sales outside the U.S. than inside,” Doyle said. The company is seeking additional executives to build out its international team, he said.

Popeyes Recruiting
FC’s Popeyes Louisiana Kitchen is recruiting a new team to focus on international growth, especially in Singapore, Chief Executive Officer Cheryl Bachelder said in an interview. The company started by hiring Andrew Skehan, who ran international operations for Wendy’s Co. and the Quiznos sandwich chain.

“The next five to seven years will be a time of investment for most companies in countries with a really strong, growing middle class,” Bachelder said. “Andy just expands our capability with that depth in international.”

Skehan, 50, a former U.S. Navy officer, has spent about half of his career abroad, living in the Czech Republic, the U.K. and Spain. In 2009, he opened the first of 35 planned stores in Singapore with Kopitiam Group, bringing shrimp burgers to locals there. He also led the chain into Russia, where Wendy’s sells beer alongside its classic burgers.

Taking on KFC
“If you look around the world, KFC has pretty much had it to themselves” for 20 years, Skehan said in an interview.

Popeyes may grow 10 or 15 times beyond the 425 stores it has overseas now, said Sam Yake, an analyst at BGB Securities in Arlington, Virginia, who advises buying the shares.

Introducing a brand to a new country is difficult, which is why Dunkin’s Baskin-Robbins chain has sought executives with marketing experience for its international team this year, said Cote, the recruiter for Chicago-based Heidrick & Struggles.

The world’s largest ice cream brand hired Paul Reynish, CEO of a Subway unit that handled advertising outside the U.S., January and promoted him to chief marketing officer of Dunkin’ Brands international last week. Reynish had previous marketing jobs with Burger King Holdings Inc. in Asia, the U.K. and Ireland.

In May, Dunkin’ tapped Panera’s president, Neal J. Yanofsky, for its coffee-and-ice-cream shop overseas expansion. Canton, Massachusetts-based Dunkin’ said last month that Yanofsky is leaving the company and that it’s searching for his replacement.

International Training
Competition for international executives is fierce as many restaurants don’t have programs to train employees to lead overseas. While Domino’s has two leadership development programs, Rising Talent and People Pipeline, the company doesn’t have a program specific to international management, said Tim McIntyre, a company spokesman.

Dunkin’s training for international leaders is similar to programs for those responsible for U.S. operations, said Christine Deputy, chief human resources officer. Both sets of executives attend Dunkin’ Brands University at company headquarters and also work in a store after being hired, she said in an e-mail.

Restaurant leaders need knowledge of countries’ tax laws and local food suppliers to expand internationally, said Fay Voysey-Smit, director at recruiter Boyden’s sub-Saharan Africa office in Johannesburg.

“They really need solid skills in supply-chain optimization,” she said.

Red-Wheat Tortillas
When Chipotle Mexican Grill Inc. began opening stores in the U.K. it had to make sure ingredients there met its standards, said Darren Tristano, executive vice president at Chicago-based researcher Technomic. The company added red wheat to its tortillas because it was available and matched diners’ tastes, he said.

Chipotle and fast-casual spots such as Panera Bread Co. may be the next restaurants drafting executives with international knowledge, Tristano said. Denver-based Chipotle is opening stores in London and Paris, which CEO Steve Ells called a “foundation for the future.”

Domino’s demonstrates how companies need someone with a knowledge of different regional tastes, said Jack Russo, an analyst at Edward Jones & Co. in St. Louis. The company has had success varying toppings in different countries, tailoring pizzas with paneer cheese in India and corn and squid in Asian nations, Doyle said.

‘Localized Knowledge’
“You can’t go in with a standardized product or platform,” Russo said. “You’ve got to go in with localized knowledge.”

Sometimes unusual experience distinguishes a candidate, said Dan Searby, who recruits restaurant leaders for Elliot Associates Inc. in Tarrytown, New York.

One dining executive hired for an international development job had served in the German army where he was required to carry nuclear bomb “suitcases” that controlled tactical weapons, he said, declining to name the person because of company confidentiality.

“That level of responsibility showed that he could handle the pressure,” Searby said.

View the full article on SF Gate


Military partnership benefits restaurant

October 30, 2011

Military Partnership

Military partnership benefits restaurant

Charley’s Grilled Subs’ relationship with the U.S. military is helping it expand and add locations overseas.

The Columbus-based restaurant chain opened its 100th restaurant on a U.S. military base last week.

And so far this year, the company, which specializes in Philly cheesesteaks, opened locations in the Dominican Republic and Brazil and is in talks to enter South Korea, Bahrain, Saudi Arabia and Central America.

The company’s 12-year partnership with the Army & Air Force Exchange Service not only allows it to serve its food to U.S. soldiers and their families worldwide, but also helps to promote the brand in countries it might not otherwise have entered, said Bob Wright, Charley’s chief operating officer.

The company has nearly a quarter of its roughly 400 restaurants on military bases in the U.S. and around the world.

“We see international a significant part of our growth,” Wright said, noting that the company has benefited from the “worldwide shift toward capitalism and the consumerism that goes along with it.”

“Mall development is growing around the world, and you see the same kinds of food courts that exist in the U.S. and the same desire to sit down with your family to eat. It’s been a great growth opportunity for us.”

The company is among the top 100 limited-service sandwich chains in the U.S., according to Technomic, a Chicago restaurant- and food-research group.

Charley’s presence on military bases is a good strategy for the company’s growth, both domestically and overseas, said Darren Tristano, Technomic executive vice president.

“The big challenge in the restaurant industry is to focus more globally, and for a chain like this, a premium sandwich category, it is important to expand internationally,” he said.

“And the strength that (Charley’s) builds with having locations on military bases helps to build the brand with a younger audience of (troops and their families) who will become loyal and continue to buy the brand after their military career is over.”

Charley’s Grilled Subs opened 38 stores last year, a majority of which are in airports, on military bases or in regional shopping malls. The company had sales of $220 million in 2009, a 15 p ercent increase from the previous year, Wright said.

The privately owned company typically adds 40 to 50 units in a year, he said, noting that the company is on pace to open 46 this year.

That’s been accomplished by converting existing restaurants or retail spaces into Charley’s restaurants. Conversions typically cost $130,000, compared with $300,000 to open a location from scratch, Charley Shin, the company’s president, has said.

Most of the stores are franchises, with the Army and Air Force service being the company’s largest franchise partner.

The group has “been a terrific partner to help us leverage the popularity of our sandwiches throughout the world,” Shin said in a statement.

Wright agrees.

“Fresh food really resonates with people no matter where you are in the world,” he said.

View the full article on The Columbus Dispatch