Speaker 1: You're listening to Bloomberg Business Week with Carol Masser and
Speaker 1: Jason Kelly on Bloomberg Radio. All right, so as we
Speaker 1: begin our last hour today, we've got a guest that
Speaker 1: Carol and I have both been looking forward to, in
Speaker 1: part because this Carol tease me about earlier. It's sort
Speaker 1: of a walkdown, uh future, past current. It's my teenage diet.
Speaker 1: Maybe I have to say maybe current. I'm still a
Speaker 1: young adult at heart. Francis Allen joins us. She is
Speaker 1: the CEO of Checkers and Rally's Drive in restaurants. She
Speaker 1: joins us on the phone from Colorado, and it's notable
Speaker 1: in part because this is a relatively new job for
Speaker 1: she hasn't even been able to show up to her
Speaker 1: office yet. We're told that's in Tampa. The quarantine obviously
Speaker 1: has thrown everything into all sorts of flux. So Francis,
Speaker 1: first of all, how are you, what's going on with you?
Speaker 1: I'm well, thank you Jason and Carol, and thank you
Speaker 1: for having me on. It is a bizarre situation where
Speaker 1: you started a new role and four weeks later there's
Speaker 1: a world's a nation lockdown. So I at least have
Speaker 1: visited the office. I have done my restaurant training, UM,
Speaker 1: but the majority of time I have been in Colorado,
Speaker 1: and I would say that, UM, huge compliment to add
Speaker 1: teams that you know, we've really not missed the beat
Speaker 1: working remotely, and I think a lot of companies are
Speaker 1: finding them. So you, like us, are working from home. UM,
Speaker 1: tell us about not missing a beat. What does that
Speaker 1: meant for the company, UH in terms of the type
Speaker 1: of demand that you've seen, and what does it meant
Speaker 1: for your employees to make sure that you're keeping them
Speaker 1: safe as well as keeping your customers safe. Yeah, it's
Speaker 1: it's really been so rewarding to UH to work through
Speaker 1: this crisis with a with such a dedicated and resilient
Speaker 1: team of people. There's always a silver lining rate and
Speaker 1: in every crisis, and I think you know, usually it
Speaker 1: brings out the best of people. And I can certainly
Speaker 1: say that that's true for the Checkers and Raleigh's whole organization. UM.
Speaker 1: From AH, I'll start with the safety. Obviously, when when
Speaker 1: we put a tassbolts together to create a response plan,
Speaker 1: we had two priorities. The first priority was the safety
Speaker 1: of our guests and their employees, and the second was
Speaker 1: really to keep our restaurants open so we can continue
Speaker 1: to employee our team members and feed our guests. So
Speaker 1: UM incredibly proud of the of the operations team we
Speaker 1: actually as as well as complying with all of the
Speaker 1: CDC mandates both individual, state and local government requirements, we've
Speaker 1: actually put in fifteen new contact lists experiences to protect
Speaker 1: our employees and I guess everything from UM plexigous areas
Speaker 1: at the window those UM, UM sorry, I just need
Speaker 1: to have my phone's got brin UM cashiers with color
Speaker 1: coded gloves for handling payments, UM praise for handling payments,
Speaker 1: infrared thermometers obviously. Fortunately we already did fifteen minute hand washing,
Speaker 1: so UM you know, we already had a very high
Speaker 1: standard of cleanliness. UM you know, cup refills with always
Speaker 1: refilled people's cups. But now we'll still do that, but
Speaker 1: we'll give you a fresh cup. So a ton of
Speaker 1: new UM procedures at the restaurant sanitation obviously to keep
Speaker 1: people safe, on people and labor um you know, obviously
Speaker 1: at this priority as the employees who show up for
Speaker 1: work every day, and I'm so proud of them and
Speaker 1: what they've done and how they kept going We're fortunate
Speaker 1: in that we have not had to lay off anybody.
Speaker 1: We did follow some people at this corporate office, but
Speaker 1: we're able to bring them back after thirty days. But
Speaker 1: we've been looking after our team members with sickly with
Speaker 1: closure pay if if the restaurant has to close, and
Speaker 1: we've also instigated a thank you pay for those restaurant
Speaker 1: team members that that have UM stayed with us through
Speaker 1: throughout the best Virus UM. I'm very proud to say
Speaker 1: we also have a an employee relief fund. It was
Speaker 1: actually established in fire thousands five, following the days of
Speaker 1: Hurricane Katrina, and has provided more than five hundred thousand
Speaker 1: dollars and assistance to about six hundred employees and their families.
Speaker 1: And we've expanded that to UM to obviously include anybody
Speaker 1: that can't work due to Corona related issues. So a
Speaker 1: lot of a lot of work put together to for
Speaker 1: our people, UM, keep our guests and our employees safe,
Speaker 1: and then of course all the marketing ship up that
Speaker 1: that we need to need it to make, so shifting
Speaker 1: really into free delivery, meal bundles, UM, social media and
Speaker 1: UH and just trying to stay very nimble and flexible,
Speaker 1: right well, and I do wonder, you know, Francis, as
Speaker 1: we are, you know, starting to see some reopenings. There
Speaker 1: are there any sort of trends that you're seeing in
Speaker 1: terms of traffic or in in terms of consumer behavior
Speaker 1: that that you're picking up as you look at the
Speaker 1: different regions that you serve at this moment. Yes, um,
Speaker 1: so um. You know what's what's really interesting for our businesses,
Speaker 1: We've we've kind of had this roller coaster experience. So
Speaker 1: in the early weeks of the pandemic, we were down
Speaker 1: double digits like many people, uh, everybody really in ah,
Speaker 1: in our industry and left you're in the piece of
Speaker 1: business and um. And that was really driven by the curfews,
Speaker 1: the shutdowns and the and especially lower sales at late night.
Speaker 1: But from about the middle of April we saw that
Speaker 1: start to come back, and for the last several weeks
Speaker 1: we've actually been up double digits. So imagine that swing
Speaker 1: going from you know, down about to up about the same.
Speaker 1: So um, but we think, yeah, we we think it's
Speaker 1: a it's a number of things. Um, it's the the
Speaker 1: majority of our restaurants drive through only, so we have
Speaker 1: closed kitchens and have been able to really drive that
Speaker 1: contactless experience. UM. We really have lead heavily into delivery.
Speaker 1: We launched a comprehensive delivery business last year. UM, and
Speaker 1: we've accelerated our efforts to promote order ahead. Combined with that,
Speaker 1: we had a really well timed values of focused promotion.
Speaker 1: We're going to continue our conversation still with us as
Speaker 1: Francis Allen. She was named CE of Checkers and Rally's
Speaker 1: Drive In Restaurants in February of this year. She was
Speaker 1: also see a Boston market president of Jack in the Box.
Speaker 1: She's held senior positions at Denny's, Duncan Donuts, USA, and
Speaker 1: a lot more. She's with us on the phone from Colorado.
Speaker 1: You know, you have such an incredible background, Francis, in
Speaker 1: terms of the different restaurants and brands that you've you know,
Speaker 1: worked with. How do you think this industry changes longer
Speaker 1: term as a result of COVID nineteen. Yeah, it's a
Speaker 1: great question, Carol, and UM, I think what we're going
Speaker 1: to see and we've seen it a little bit already
Speaker 1: with soft casual coming in and blurring the lines between
Speaker 1: Q I saw in in casual dining, and I think
Speaker 1: we're just going to see that even more so, we're
Speaker 1: gonna see casual dining restaurants looking for doing copes I
Speaker 1: pick up and you know, trying to get us close
Speaker 1: to the whole drive through model as as I think
Speaker 1: it's it's ease of all for them to get. I
Speaker 1: think we're going to continue to see consumers who are
Speaker 1: really quite concerned about a dining in and so there
Speaker 1: definitely will be a move more towards delivery and and
Speaker 1: take out. We're going to see an acceleration of, um
Speaker 1: that digital engagement with brands as people try and order ahead.
Speaker 1: And I think, sadly, UM, you know, the industry has
Speaker 1: been overstored for some time, and that's meant that there
Speaker 1: has been a very very anemic traffic growth. UM. Sadly,
Speaker 1: I think we're going to see about twenty percent of units.
Speaker 1: I mean, who knows, it's a it's a guest at
Speaker 1: this point, but um, we've already had a lot of
Speaker 1: permanent closures. So that's gonna actually, I think be good
Speaker 1: for the industry as a whole because it's actually create
Speaker 1: more more traffic growth than and more energy. So, UM,
Speaker 1: I see, I see lots of changes. Does that does
Speaker 1: apply to you? Guys as well that cut back potentially.
Speaker 1: I know, um, we we closed um up to fifty
Speaker 1: restaurants out of nine hundred. If they were ones that
Speaker 1: were primarily in more locations, or or they or they
Speaker 1: had dining rooms, Um, most of those will reopen. It's
Speaker 1: it's more the you know, the people that just weren't
Speaker 1: able to generate revenue during during this time. And I
Speaker 1: think some of the hardest hit are actually going to
Speaker 1: be the fine dining restaurants, because if you think about
Speaker 1: fine dining, it's all about the business traveler. And I
Speaker 1: don't see the business traveler really returning on mass the
Speaker 1: way that we have been operating up to now. I
Speaker 1: see business changing a lot over over becoming a couple
Speaker 1: of years now. I think you're exactly right. I mean, listen,
Speaker 1: we've had a number of those chefs on the program. Uh.
Speaker 1: And you know, we're talking about some of the best
Speaker 1: restaurants in the world, not the least of which is
Speaker 1: eleven Madison Park, And you know they're chef and owner
Speaker 1: Daniel Whome has has basically said he doesn't know if
Speaker 1: if that restaurant is going to reopen. That's a really
Speaker 1: interesting uh. And and salient point about business travel. I
Speaker 1: do wonder, you know, Francis, at a time when we
Speaker 1: all are and and I am a huge fan of
Speaker 1: every place that you have ever worked, as I uh
Speaker 1: as I laid out in the intro. But but I
Speaker 1: do wonder, from your perspective, knowing what you know about
Speaker 1: menus and and and health concerns and health trends and
Speaker 1: all that, how does your menu change going forward? What
Speaker 1: are people going to be angling for, especially as they
Speaker 1: get back out in the world a little bit. Well,
Speaker 1: I I actually think people are going to lean into
Speaker 1: comfort suit. I think that they're really familiar to them
Speaker 1: and value so that puts us in a great position
Speaker 1: with that prize. Jason, I'm delighted that you're you're a fan. Um.
Speaker 1: I'd like it to be your adult diet as well
Speaker 1: as your teenage diet. You know, there's nothing like a
Speaker 1: Checkers and Valley Spride actually make, you know, make the
Speaker 1: day seem a lot better. I couldn't agree more so.
Speaker 1: So I think we're going to see that. And you know, frankly,
Speaker 1: I think the people that were really into healthier food
Speaker 1: or organic or sustainable sustainability before there's h they're going
Speaker 1: to continue afterwards. Um, but I think for most people
Speaker 1: it's going to be a return to comfort food and
Speaker 1: comfort brand um and value um and uh. And you know,
Speaker 1: I think I think really looking at simplifying, So we'll
Speaker 1: probably see a lot of many simplification over the coming
Speaker 1: I get to say, France, as I see some loaded
Speaker 1: fries in Jason Kelly's future, I'm just gonna say, um, yeah,
Speaker 1: know I you know, we do have to ask you.
Speaker 1: I think before we leave. We've just got about a
Speaker 1: minute left. You know. Obviously we've been focused on the
Speaker 1: virus and how your world comes back, but you know
Speaker 1: what happened in Minneapolis and what we've seen there. UM,
Speaker 1: I am curious. How is a company you can help
Speaker 1: facilitate change. It's a great question, and I first want
Speaker 1: to express my deepest condolences to the family of George
Speaker 1: George Floyd. I also want to share that Checkers and
Speaker 1: RALEI support the black community and we've always been proud
Speaker 1: to be a part of the communities we serve. And
Speaker 1: I believe that being a part of a community means
Speaker 1: standing by each other in good times and in challenging time,
Speaker 1: so together we can work for real change and to
Speaker 1: that in what we'll be doing as an organization is
Speaker 1: taking a close look at how we can be more
Speaker 1: supportive of our neighborhoods than our communities in the future.
Speaker 1: All Right, well, best of luck to you and uh
Speaker 1: I hope to see you on the other side of
Speaker 1: this and UH share some fries and from a socially
Speaker 1: distant and safe perspective, for instance, Allen, thank you so much,
Speaker 1: CEO of Checkers and Rallies drive in restaurants,