Speaker 1: Well, it's Friday pizza night at my home. It has
Speaker 1: been for years. Love love love pizza, as do many Americans,
Speaker 1: and that is definitely something our next guest knows all
Speaker 1: about as the CEO of Blaze Pizza, which has restaurants
Speaker 1: around the country, also in Canada and can lay claim
Speaker 1: to one very well known investor in French hise Z owner.
Speaker 1: We're talking about Lebron James. Let's bring in the company's
Speaker 1: president and CEO, Mandy Shaw. She is with us on
Speaker 1: the phone in California. I'm thinking about my pizza, which
Speaker 1: is why I can't speak. Mandy. Nice to have you here,
Speaker 1: Welcome to Bloomberg. Thank you so much for having me.
Speaker 1: Delighted to be here and love to hear that you
Speaker 1: have your weekly pizza. That sounds like the majority of Americans.
Speaker 1: I think it's a number of thirteen percent of the
Speaker 1: population is eating pizza on any particular day. So that
Speaker 1: is what we'll tell me about the last the last year, Like,
Speaker 1: how has that been for you? I mean go back,
Speaker 1: first of all, a year. What was going through your
Speaker 1: mind as the pandemic was kicking off? Yeah, it's not funny.
Speaker 1: A year. It feels like it and then it feels
Speaker 1: like ten years if you think back to that first
Speaker 1: week of shutdowns when everything is sort of solidified. No
Speaker 1: one knew if this was the apocalypse, right. So the
Speaker 1: first thing that we had to do is make sure
Speaker 1: our franchisees were financially secured, were franchise organization uh So,
Speaker 1: we gave an industry leading release package for nine weeks.
Speaker 1: We coached them on p PP. We had individual coaching
Speaker 1: sessions with franchisees to make sure they could get those
Speaker 1: dollars that as they became available. We provided other forms
Speaker 1: of relief. We got tons of vendor donations for hand sanitizer, masks,
Speaker 1: a lot of the things that had to go into
Speaker 1: the restaurant to make sure that safety was paramount for
Speaker 1: our team members as well as our guests coming into
Speaker 1: the restaurant. And then really where we deepened what is
Speaker 1: really important to me anyway from a franchise perspective, is
Speaker 1: transparency and communication. We had daily calls with our franchise council.
Speaker 1: We had weekly franchise all hand franchise e calls where
Speaker 1: we said here's what we know, here's what we don't know,
Speaker 1: here's what we're gonna tell you next week, right. And
Speaker 1: so if you think about the business are dying in.
Speaker 1: Sales were still eighty percent of our top line pre pandemic,
Speaker 1: and then they all just shut off. So we had
Speaker 1: to what I called get gorilla and figure out how
Speaker 1: we raise awareness that we were still open. You could
Speaker 1: still come into a blaze, walk down the line, make
Speaker 1: your pizza and take it out. You just couldn't sit
Speaker 1: down in the restaurant. And you know, we already had
Speaker 1: delivery with two providers UH and other other um like
Speaker 1: purpose excuse me, carry out and walk out service, but
Speaker 1: we introduced curbside carry out in three weeks time. I
Speaker 1: just said, we gotta get it up. We gotta figure
Speaker 1: out how to do this and move quickly and make
Speaker 1: it happen. We added Uper Eats as our third delivery
Speaker 1: provider and those were incremental sales UH. And so we
Speaker 1: just put together a lot of programs to make sure
Speaker 1: that we were taking care of our franchises and getting
Speaker 1: those sales back in the door as fast as we
Speaker 1: possibly could. You know, it's interesting, there's a lot of
Speaker 1: conversations that we have had um with restaurants that you
Speaker 1: know had a digital strategy perhaps, but all of a
Speaker 1: sudden because they had to ramped it up dramatically. Tell
Speaker 1: me about the digitization of your business and how that
Speaker 1: strategy has maybe changed because of the pandemic, or or
Speaker 1: has been ramped up. Uh, ramped up you called it?
Speaker 1: What's the word you would use? Yeah, I mean it's
Speaker 1: we're up a hundred. Yeah. We started um in the
Speaker 1: summer of nineteen. We launched two specialty crusts, the cauliflower crust,
Speaker 1: and we were the first national chain to launch a
Speaker 1: Keto crust six Graham's Net carbs, and so right on
Speaker 1: the heels of that, we also launched a large pizza,
Speaker 1: a shareable family office space, you know, more like what
Speaker 1: a legacy pizza looks like. And it delivers better because
Speaker 1: it's engineered to hold heat. And so we had a
Speaker 1: three sixty degree media campaign to build a digital business
Speaker 1: and it was growing. We had an eight point comps
Speaker 1: wing from call it all of of figure prior to
Speaker 1: just before the printed pandemic. Uh, and then it dropped out.
Speaker 1: So from great pain comes great reward at times. What
Speaker 1: this has done for us is build that digital business.
Speaker 1: We range week to week from fifty fifty to sixty
Speaker 1: forty in terms of digital versus dining, and what that
Speaker 1: means for us is greater total top line coming out
Speaker 1: of the pandemic. Might be a slightly painful way to
Speaker 1: get there, going through all the things that we had
Speaker 1: to do, but the mass of people who came to
Speaker 1: off premise dining, you know, I've read some statistics at
Speaker 1: one point about there's a six increase of people over
Speaker 1: the age of fifty adopting app ordering right deliveries or
Speaker 1: party delivering, those sort of things that we saw it
Speaker 1: in the numbers and what these players have been able
Speaker 1: to accomplish. So we got our piece of that, and
Speaker 1: now as we get dining rooms reopened again, we're retaining
Speaker 1: eight percent of that business or so, which means our
Speaker 1: volumes are much higher than they were previously, which again
Speaker 1: is it's a win for the brands. I mean, they
Speaker 1: kind of ask you it's like to have Lebron James
Speaker 1: as an investor, as a franchise e, a franchise e owner,
Speaker 1: someone who's actually been a lot of videos, viral videos,
Speaker 1: um for Blaze Pizza. What is that like? One word? Fun?
Speaker 1: So exciting? You know, Lebron Is is a great partner
Speaker 1: in that he actually cares and he makes selective choices
Speaker 1: about who he quote gets in bed with right and
Speaker 1: years ago he decided to come to Blaze because of
Speaker 1: our philosophy of clean ingredients, better food, better for you,
Speaker 1: you know, a new way to pizza upgrades. And so
Speaker 1: it's it's a rather informal partnership that just really it's fun.
Speaker 1: Anything that we offer up to him, like those viral videos,
Speaker 1: he just says, yeah, let's have a good time with
Speaker 1: us and and see what we can do. And it's
Speaker 1: really just part of his portfolio. And Blaze wins when
Speaker 1: he wins, and vice versa. So it's a it's a
Speaker 1: very nice additive part too with the Blaze persona is
Speaker 1: for sure. Well, it's interesting to you talk about kind
Speaker 1: of things that are important to him in terms of
Speaker 1: how you guys make your pizzas it's real ingredients, not frozen,
Speaker 1: they're made in house every day, no chemicals, no additives,
Speaker 1: no nitrates in the meats. I mean, this is a
Speaker 1: huge trend in the food industry and we just see
Speaker 1: it continue to pick up momentum. How is that shaping
Speaker 1: kind of how you guys continue to move forward, how
Speaker 1: you uh you know supply out ingredients. Tell us a
Speaker 1: little bit about that. Yeah, our chef, chef Rad Kent,
Speaker 1: was one of the founders of Blaze, and honestly I
Speaker 1: rely on him quite a bit and the concept does
Speaker 1: because his background is really unique. He's got a business degree,
Speaker 1: he's a food scientist. He has worked as a personal
Speaker 1: chef and was a food designer for some large brands
Speaker 1: across the country. So he's a very unique chef in
Speaker 1: that he understands what corporate R and D is about,
Speaker 1: but he really makes amazing food. So he's one of
Speaker 1: the first people who worked directly with providers to do
Speaker 1: things that you would never think of, like take additives
Speaker 1: and preservatives out of banana peppers. All other banana peppers
Speaker 1: have some kind of preservative in them to keep that yellow, bright,
Speaker 1: vibrant color, and we have none of that. So the
Speaker 1: list is long of things where he is just decided
Speaker 1: it's important and he really wants to change the world.
Speaker 1: He wants to have an impact on food supply and
Speaker 1: the food system and showing that you don't have to,
Speaker 1: you know, compromise when you eat things. It's not we
Speaker 1: don't do it in a luxury way. We're not here
Speaker 1: to you know, tell people how they should eat. To us,
Speaker 1: just the cornerstone of how we want to present ourselves
Speaker 1: and what is important to the consumer. So anything we
Speaker 1: put in the restaurants, we put it through that lens
Speaker 1: of does it meet this criteria of really being a
Speaker 1: better product and tasting amazing? Right, We're not out just
Speaker 1: chasing trends just for the sake of chasing them. So
Speaker 1: it actually is thank you for mentioning it a really
Speaker 1: important part of of what we do. Well, it's a lot,
Speaker 1: and I got to say it's a bigger and bigger
Speaker 1: conversation that we are having, um when it comes to
Speaker 1: anything with food. I mean, I think back to conversation
Speaker 1: sations we've had with John mackew over at Whole Foods,
Speaker 1: conversations I had for years with Steve Els about what
Speaker 1: they were doing at Chipotle, like this whole idea of
Speaker 1: how can we make kind of the whole food supply
Speaker 1: chain better and provide people with food that is better
Speaker 1: for them? Ultimately, UM, going forward, tell me about growth
Speaker 1: plans and has the pandemic sped them up, slowed them down?
Speaker 1: How has it changed maybe you know the expansion or
Speaker 1: any kind of cop ex spending going forward. Great question. Really,
Speaker 1: the slowness that came from the pandemic was related to
Speaker 1: just COVID delays, not necessarily anyone having trepidation about opening
Speaker 1: a restaurant. So we opened twenty restaurants last year. We've
Speaker 1: got thirty in the pipeline this year, which means people
Speaker 1: might have been a little slower to pull the trigger
Speaker 1: on new opportunities, but real estate is opening up, so
Speaker 1: that means this is where the growth moment comes, and
Speaker 1: particularly after large economic disruptions or life changing economic situation,
Speaker 1: franchise these tend to win people who might be displaced
Speaker 1: from their jobs and have always had this dream of
Speaker 1: running a restaurant, to have some involvement or have an
Speaker 1: operating partner who has some experience, actually will come seek
Speaker 1: out brands like us. We have over a hundred fifty
Speaker 1: people in our pipeline who are interested in opening Blazers.
Speaker 1: We have territories available in some really hot markets because
Speaker 1: we need to build some density. There's still an awareness
Speaker 1: proposition for fast casual pizza across the country where a
Speaker 1: lot of people need to figure out what that is.
Speaker 1: And to your point, a moment ago figure out what
Speaker 1: better pizza tastes like. Um, so are we have a
Speaker 1: rough sencil to eight and that's based on sustainable growth.
Speaker 1: I think there's a lot of concerns with franchisees occasionally
Speaker 1: about other just opening a restaurants to open them. Uh,
Speaker 1: I'm I am more about franchise profitability. Right. The more
Speaker 1: I can get you to open a restaurant that has
Speaker 1: a great return, you will open more restaurants and then
Speaker 1: my pm L takes care of itself. So yeah, we
Speaker 1: have a we have a gre eight track record ahead
Speaker 1: of us of um getting to that eight hundred number,
Speaker 1: but in a really sustainable way. Yeah, really interesting. Um
Speaker 1: is it all going to stay US Canada or their
Speaker 1: thoughts overseas expand the overseas network or how do you
Speaker 1: see it? Oh? Definitely, yeah, definitely. We're actually already in
Speaker 1: Dubai boxing. Um yeah, no worries stories um, and I
Speaker 1: think this brand has legs almost universal. Any pizzas just
Speaker 1: one of those fiquitous food groups, right, but certainly India,
Speaker 1: South Korea is a tremendous market. China, Um, yeah, sky's
Speaker 1: the limit. We have a little bit of work we're
Speaker 1: doing this year on some of the domestic footprint. Really
Speaker 1: optimizing franchise the profitability again, because it's the better you
Speaker 1: can get that machine to work, the faster the proposition
Speaker 1: sells itself. So there's a lot of investment that we're
Speaker 1: making this year from a corporate perspective to make sure
Speaker 1: that happens. But we absolutely have our eye on other
Speaker 1: international markets to think of pizza's a main food group.
Speaker 1: I'm just going to put that out there. Um, what's
Speaker 1: the plan? Though? Do you stay private? There's lots of
Speaker 1: money floating out there, there's companies going public through a spack.
Speaker 1: I've talked to folks with restaurants backs who are looking
Speaker 1: for properties to snap up. What's the plan? Is there
Speaker 1: anything on that horizon? I get a lot of calls
Speaker 1: from there. I bet you do. Um, yeah, I think eventually, right,
Speaker 1: But the franchise model is pretty capital light, so there's
Speaker 1: not a burning need for me right now to raise
Speaker 1: a ton of money. But it's one of those things
Speaker 1: that we are I I described laze as we're at
Speaker 1: the Harvard business case pivot point of where restaurant companies
Speaker 1: get right. You get three four hundred units and you
Speaker 1: either invest like I was referring to a moment ago.
Speaker 1: Put some money into it, do consumer research, some brand work,
Speaker 1: make sure you're pricing is aligned, focus on profitability, and
Speaker 1: put any infrastructure such that you can grow to five
Speaker 1: hundred thousand, or you get really fighting about your own
Speaker 1: PNL and how spect everybody thinks you are and you
Speaker 1: might go too soon. Uh, and so I say yes,
Speaker 1: but it's not what I lay away to think, you know,
Speaker 1: lay awake at night thinking about right, It's more about
Speaker 1: this idea of just growing the concept. So where I
Speaker 1: believe that. She well, this was a great conversation. Do
Speaker 1: come back and tell us how things are going, and
Speaker 1: we'd love to hear updates. Have a good weekend, Mandy Shaw,
Speaker 1: she's president CEO of Blaze Pizza, joining us from California.
Speaker 1: I did a quick pull. Pepperoni is the favorite topping?
Speaker 1: Kevin Cirelli coming up with soundown, what's your favorite topping
Speaker 1: on pizza? Opperoni? You know, I know what I'm having
Speaker 1: for dinner and Congressman Brendan Boyle is joining me. Pizza.
Speaker 1: That's I'm definitely having pizza tonight. Definitely have a good show.
Speaker 1: Looking forward to it all right, Sona with Kevin's really
Speaker 1: coming out. From our whole Blueberg Business Week team, thank
Speaker 1: you so much. Everyone, have a good and safe weekend.
Speaker 1: This is blue Berg