Then, as a follow up, how have you made life more comfortable for employees wearing masks and facing other new realities?
We have asked our team to be good listeners. When someone comes to leadership with a problem, we need to be accommodating. Jimmy John’s is about being “Freaky Fast,” so it is against our nature to slow down, but I asked the team to allow for more breaks etc., and I made it clear that it was OK to accommodate. It’s hot, and masks are miserable, people need frequent, quick breaks that we have never really allowed before. I am currently working on financial independence resources as well. I think the economy is going to have a broad effect on our teams’ lives and I want them to be as prepared as possible. There is also a nice opportunity for those with jobs to create wealth.
Run through some of the policies and in-store procedures you implemented to meet COVID protocols, like high-traffic point cleaning and pre-shift wellness checklists.
We have a whole book we follow. First off, we did not open our lobbies until we completed a “back to operations” checklist with complete integrity. This included deep cleaning the stores and making sure we had proper PPE in place for employees and customers. This took many hours to complete, but we used it as a reset for the store. It took 4-5 weeks to complete in some stores. Jimmy John’s has seven rules we live by, even prior to COVID. No. 5 on that list says “Keep it Hospital Clean.” Describing our cleanliness goal as “Hospital Clean” is very impactful on what clean means to us. It really hits home today, but since we had already focused on cleanliness at such a high level, all we had to do was point out the importance of sanitizing services etc.
What are some highlights of the 27-point reopening checklist you have for in-store dining?
Acquired two different colors of gloves to make sure we handled food differently than registers and customer contact points. I wanted to make sure there was ZERO chance of an employee forgetting they had just handled cash and moving quickly to make a sandwich.
Most of it had to do with visible cleanliness. Customers expected to see a sanitized environment. If we needed to repaint a wall to look clean, we did it. We also pressure washed sidewalks and furniture.
Installed sanitizer in the lobbies.
Replaced employee uniforms.
What is your status today, especially as markets roll back reopenings?
We are 100 percent open. All of our stores have reopened for at least some hours of the day. Our sales are not at 100 percent, but our margins are hanging in there. We believe students coming back to campuses and people going back to work (in their office) would be the last two things we need to bet at 100 percent.
What kind of plan is in place if an employee tests positive for COVID?
We follow the CDC guidelines. In most cases, the store is shut down for another deep clean, and employees are notified that they may have been exposed. We have very strict guidelines, and in most cases, the pre-shift wellness interview catches anyone that may have not realized they were exposed.
Just generally, what kind of consumer behavior are you seeing these past few days? Do you see pent-up demand clashing with renewed concerns?
We are as confused as ever. Each bit of news has an impact on our business. I think some people want to eat in restaurants, but an overwhelming majority do not. We are celebrated when people notice our new cleaning and mask procedures and risk being chastised if an employee’s mask falls below their nose. There is NO room for error in this market.
Did you participate in the PPP or any government loan programs?
We did receive a PPP and I don’t think we would have been open without it.
Broadly, what changes did COVID accelerate that you believe will stick later on for your business?
Broad sanitation and cleanliness focus. I think consumers are pretty comfortable with delivery at this point, and I am personally excited that they have probably tried a lot of different things for delivery. You will probably discover a cold sandwich and kettle chips deliver much better than a hot sandwich with fries.
How long do you think it will take the industry to recover?
I believe it will take a long time for the industry to recover. There is no question it will end up being a mixed bag. For example, I think it will be years for full-service restaurants that have been closed or operating at a significantly reduced capacity. If landlords and banks help with forgiveness, however, it may be sooner. I think there will be a few winners in this crisis, but quick-serves who have lost 2-3 months of profitability or better, should be able to recover by fall of 2021, assuming fall of 2020 is somewhat normal. As we get closer to the fall, it is beginning to become more and more clear that this Fall will be anything but normal. This is going to be a long process and we must shift strategy to survive.
Do you think there could be growth opportunities stemming from the crisis?
I think there are always opportunities and I think an individual’s appetite for risk will largely determine the bet. I think trying to call the “new normal” today is extremely risky, but people will do that, and there will be winners and losers. You will hear about the winners, who happened to be very lucky in their assumptions, and be inspired by them. I think you rarely hear about the real losers, but some will undoubtedly make the wrong assumptions. Clearly, there will also be distressed company opportunities in the market, but I think there will be a gap in pricing expectations between buyers and sellers throughout 2020. The value of a drive-thru and efficient delivery has never been higher, and I expect ghost kitchen activity will increase during this downturn. If you happened to be setting up a kitchen based on lunch-time office traffic, however, you probably need to pivot or at least reduce expectations.