Johnny Rockets, Andy Wiederhorn, Rockets discussed on Bloomberg Markets
Both Johnny Rockets restaurant chain and he didn't during the pandemic. Let's welcome now. Fat brown CEO Andy Wiederhorn, Andy. Congratulations, very A bold and brave decision to make. I assume you decided that it was a good one to make, because people would be needing to find food that happened to, you know, go to a grocery store chains that might be out of what they needed. Is that what caused you to buy the Johnny Rockets restaurant train? Great here. Yes, You know, we've been looking to buy the spent for several years. It hasn't just been an impulse purchase for us. We inquired about finding around a few years ago. They weren't ready to sell it. And finally they put it on the market at the beginning of the year before the pandemic, So we started the process then and then everything got shut down, of course, and we've got two kept discussions going on, and I figured out a clear path to get to the finish line. But this brand new rocket is a is a great brand. It's iconic it. It's well known around the world. It fits in our portfolio of other burger brands with it seemed seemed designed complements the other brands we have, so it's really good. Part of the Johnny Rockets. Appeal, though, is the whole diner atmosphere, right? The red seats and pulling up and the ordering, you know, feeling like you're in a sixties joint. What happens when people don't get that when they really just get the food? Well, so you know, it is always about the food, but no one wants to go to a restaurant. You know, like the food. Johnny Rockets has great food. That's not that's not an issue of milk shakes fries. You know the atmosphere's fun. And look, you know, Covert 19 crisis is really crisis, but it's a short term prices. This will be over in, however long the six months 12 months, whatever it will be over. People will return to some normalcy in their lives. Johnny Rockets has delivery into go, so they're they're surviving on that today, to the extent that they don't have outdoor dining rooms or whatever the particular state or country is allowing right now. But, you know, I don't really think that this is a long term crisis. It is very Devastating to the short term to restaurant operators that everyone will get through this and, you know live to fight another day. How are you differentiating yourself with other fast restaurant chains, So we've seen Chipotle do well during this. For example, McDonald's has been doing pretty well on obviously slightly different food, but at the same time, you know, I'm sure you appeal to a similar demographic. So how do you get that business and and steal that market share while you can. Yeah, You bet. So our the brand stopper Garden Elevation burger are two other burger vans and elevation burgers and Australian eats grass fed organic burger chains that differentiates it right. There was like french fries fried in olive oil. On tap burger, iconic urban brand shakes fries all kinds of ingredients on totally different experience. This custom made right in front of you, one by one in order everything separately. Rockets has pre designed Burgers where you could pick the different different items off the menu, and it stands out really, for the shakes the fries and the burgers that are just so I identified with In the 19 fifties and the diner concept, so it's really from a delivery and to go perspective. We were always around 35% delivery and to go now that shot up to more than 70% on all the delivery platforms, so it's very easy to stay in the game. With delivery to go. We're also going to introduce plant based proteins to Johnny Rockets. They haven't haven't embraced that. They've had a black bean burger but not impossible burner. We sold a million possible burgers last year tappers alone, So I think that would be a great alternative to introduce. Also, like Vegan milkshake, vegan cheese just so you can appeal to everyone. Yeah, absolutely. So your franchisees. How are they doing? Have they've been able to, you know, keep up payments. Are you taking care of them? How is it all working? Well, so we view the franchisees are customer right cause that's what pays us a royalty. It's not really the customer eating the burger franchises. So that's a very important question. Our entire focus was to pivot on the Survival of the franchise fee. We have to coach them into getting the PPP bones which were extremely helpful, and we need another round of those to coach them and negotiate with their landlords could help him get better terms from the food suppliers. To get tpp and tp the massing thermometers and clubs and things like that in all the restaurants and change our advertising to market that to go on delivery right now, So we've done that, and we've seen our burger brands are operated in the 75 to 80% of normal range right now, and that's with a lot of dining rooms. Still closed so they don't really well but you know, they really, really need another round of epi. Yeah. I mean, do you have a percentage of off restaurants that you think we'll close? Some, You know, potentially fantasies. And are you lowering the I suppose royalty fees that you're charging them. So first of all of that out of our 375 restaurants before Johnny Rockets with John Ross will be 700. We lost about 15 restaurants over that over the last six months, and not a very big percentage. Most of the restaurant operators have hung in there and have the Main power with people needed to do that again. I can't tell you enough how helpful that was, But I think you know that from a royalty perspective if the restaurant's cell less than we get Halo, so it's proportionate in terms of lower in the world that happens automatically. You know, our focus right now is just get them through that and get the operator's through the winter because a lot of the outdoor dining right is going to be over here in a couple of months, Right, Tio different temperature for sure have tense and heaters and things like that ordered right now. Don't wait till October to order those things. And let's hope we don't get the diamonds back, open everywhere, even in a even a moderate exactly and get 60 sixes and a grilled cheese and our Philly stakes are thanks to you, Fat bronze CEO Andy Wiederhorn on all of that. Now let's get to our 99 1 Studios in Washington D. C.