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Papa John's Pizza (Nasdaq: PZZA) is the third largest carryout and delivery pizza restaurant in the United States behind Pizza Hut and Domino's Pizza; it is based in Louisville, Kentucky. Papa John's slogan is "Better Ingredients, Better Pizza." There are nearly 3,000 Papa John's stores in the U.S., over 200 in the UK and 29 stores in Mexico.
The founder of Papa John's, John Schnatter, began his pizza career as a high school student at Rocky's Sub Pub in Jeffersonville, Indiana. He continued this while in college at Ball State University, working as a delivery driver for Greek's Pizzaria in Muncie. Upon graduating, he began working for his father, who was co-owner of the bar "Mick's Lounge," in Jeffersonville. In 1984, he sold his car to buy out the other owner of the bar, knocked out a broom closet and started serving pizza to customers. Business started picking up, and soon enough Mick's Lounge was converted entirely into the first Papa John's restaurant.
The corporation credits its growth to attention to quality and menu simplicity, contrasting that with other chains' focus on low prices and menu options. Pizzas failing to garner an eight on a ten point scale are discarded. Fewer options in crust styles and side dishes simplify inventory management and are meant to allow greater focus on what options there are, though Papa John's has recently moved toward the industry marketing trend of constantly adding and advertising new menu items. Most recently, they have added thin-crust and pan pizza options, but each with its own "different" twist: the thin crust has been advertised as crispier than others (similar to St. Louis-style pizza) and the pan has a "Robusto" sauce with chunky tomato. To further simplify in-store operations and to provide product consistency between stores, many functions such as dough production are carried out by an off-store commissary system.
Papa John's primarily takes carryout and delivery orders although many stores have a few tables and chairs. Papa John's offers online ordering throughout the United States, automatically assigning all registered customers to the closest location.
Despite its success, Papa John's has had its share of difficulties. In 1997, Pizza Hut sued Papa John's over its "Better Ingredients, Better Pizza" slogan, based on a series of advertisements that compared the ingredients of Papa John's and its competitors. At trial, the court agreed with Pizza Hut's claims that Papa John's slogan did not constitute statements of literal fact. In other words, the district court agreed with Pizza Hut's argument that "fresher ingredients" do not necessarily account for a "better" pizza. (Papa John's did indeed prove in court that it uses fresher ingredients.) This ruling was overturned in 1999 when Papa John's appealed the decision.
The motivation behind the lawsuit may have been the fact that Pizza Hut co-founder Frank Carney had become a Papa John's franchisee in 1994. By 2001 he owned 133 locations, with his franchise based in Houston, Texas.
The structure of a Papa John's restaurant is the typical one seen in many fast food outlets, with a salaried store manager presiding over day-to-day operations, with several salaried or hourly assistant managers and shift managers presiding over in-store and delivery team members. Above the store management is an area supervisor (district operator (DO) in corporate stores), who is generally supervised by a franchisee or, in corporate stores, an operational vice president (OVP).
Franchise stores can be bought and their owners pay a certain percentage of sales (5%) to Papa John's International, a portion of which are used for advertising and support. Corporate operations looks over franchisees to ensure brand consistency.
As of January 26, 2003, there were 2,787 Papa John's restaurants (591 company-owned and 2,196 franchised) operating in 49 U.S. states and nine international markets. Papa John's International is a publicly traded company, with 30% of shares owned by John Schnatter.
Papa John's became one of the first major pizza chains to include a dipping sauce with every order.
On March 30, 2006, Six Flags announced that it will sell only pizza from Papa John's at its parks. In turn, Six Flags will receive an annual sponsorship and promotional opportunities from Papa John's, though financial details of the deal have not been disclosed.
See also
- Papa John's Cardinal Stadium, a football stadium on the campus of the University of Louisville bearing the company's name via a naming rights agreement. Coincidentally, Ball State, where Schnatter went, are also the Cardinals.
External links
- Papa John's website
- Brandweek article on Pizza Hut v. Papa John's lawsuit
- Cato Institute critique of lawsuit