Who owns Jimmy Johns? – Inspire Brands owns Jimmy John’s Franchise, LLC, an American-licensed sandwich fast-food restaurant company. Jimmy John Liautaud started the company in 1983, and it is based in Champaign, Illinois. Except for Alaska, Hawaii, New Hampshire, Maine, Vermont, and Rhode Island, the firm has grown to almost 2,700 sites in 35 years. 98 percent of the sites will be franchised by 2020. The creator of Jimmy John’s has shown interest in developing into Toronto, Canada, shortly.
History and Education – Who owns Jimmy Johns?
Jimmy John Liautaud’s dad gave him the option of joining the military or starting a company when he finished second to last in his school at Elgin Academy in 1982. Liautaud selected the latter, and his father gave him $25,000 to open a hot dog stand, with the son owning 52 percent and his father owning the other 48 percent. He quickly concluded that a hot dog stand would be too expensive for him, so he opted to start a sandwich store. The first Jimmy John’s debuted in a basement in Charleston, Illinois, on Jan 13, 1983. With a monthly rent of $200, Liautaud could only manage secondhand appliances such as a chest freezer, refrigerator, meat slicer, and oven. Jimmy John’s had gone a long way before Jimmy John Liautaud originally established his sandwich business in 1983.
How Jimmy John’s started?
Jimmy John’s has become one of the most popular franchise ideas in the United States because of its focus on licensing. The franchise was ranked first on Entrepreneur Magazine’s Franchise top 500 last year. The chain stresses the use of fresh food and the absence of artificial additives. Jimmy John’s is also concentrated on speed, with Liautaud claiming that his employees can create a sandwich in under 60 seconds. Jimmy John’s, on the other hand, has had some issues in recent years. Employees had to sign non – compete for contracts, which meant they couldn’t work for competitors like Subway or Potbelly for two months after leaving their employment, and the company faced outrage and a lawsuit in 2014.
Later in 2014, Jimmy John’s allegedly ceased advising franchisees to use non – compete for contracts. In June 2016, as part of a deal with the New York prosecutors office, Jimmy John’s formally agreed to stop include the agreement in employment paperwork in New York. In 2011, Liautaud threatened to transfer Jimmy John’s headquarters from Illinois towards a more tax-friendly state, which drew some unfavorable attention. The threat was never carried out, and the company’s headquarters remain in Champaign, Illinois. Following Roark’s purchase, Liautaud will remain president of Jimmy John’s board of directors and the corporation’s single largest individual shareholder.
In a statement released on Thursday, Liautaud stated, “I’ve spent two years trying to get to know the Roark group.” “They are best-in-class individuals with the experience and expertise to assist us in taking our marketing to the next level.” Jimmy John’s is the most recent addition to Roark’s extensive line of acquisitions. The private equity firm owns a controlling stake in restaurant franchises such as Arby’s and CKE Brands and non-food ideas, notably Drybar and Anytime Fitness.
Due to Jimmy John’s readiness to transport his sandwiches to the neighboring residences at Eastern Illinois University, and also his dishing out free bags for marketing purposes, the restaurant was able to turn a profit during the first year of operation, despite its bad location. In April 1985, Liautaud purchased his father’s company’s share, making him the sole owner. He launched his new store in Macomb, Illinois, around 1986, then his third store in Champaign, Illinois, around 1987. Jamie Coulter, who eventually become the President of Lone Star Steakhouse & Saloon, encountered Liautaud in 1988. Liautaud was mentored by Coulter, who “trained how to operate numerous units efficiently.”
Openings of Stores
Before commencing franchising in 1994, Liautaud proceeded to build new locations and create a prototype. Franchising continued through 2002 when Liautaud took a one-year break from selling franchises to help failing businesses. In Eau Claire, Wisconsin, the very first franchise shop opened. In Mt. Pleasant, Michigan, the first hundredth Jimmy John’s shop opened in 2001. The 500th shop opened in Seattle, Washington, around 2007, and the 1000th debuted in Beaverton, Oregon, in 2010.
Since Weston Presidio’s participation, the firm has undertaken two recapitalizations. First, Jimmy John’s founder and president, Jimmy John Liautaud, will stand down and join Inspire’s board of directors as an adviser. In recent times, Liautaud, a hunter, has become a liability for the firm after social media images of him holding an elephant and a leopard he allegedly shot surfaced, prompting calls to boycott his restaurants. “I don’t hunt large African game anymore,” Liautaud stated in a 2015 press conference with the Chicago Tribune.
Jimmy John’s announced in September 2016 that Roark Capital Group has agreed to buy a controlling interest in the firm. The purchase’s terms also weren’t immediately released. However, it was subsequently clarified that Liautaud would maintain a 35 percent stake in the company, part of the agreement. In addition, Liautaud would remain executive chairman as part of the deal. On September 25, 2019, Inspire Brands announced that it would purchase Jimmy John’s for an undisclosed sum in a deal that Liautaud and the remainder of the Jimmy John’s management board unanimously supported. Liautaud will stand down as president of the firm and become a consultant to the brand when the acquisition closes. On October 18, the purchase was completed.
Jimmy John’s said on Wednesday night that Roark Capital Group had struck a deal to buy a controlling stake in the firm. The price was not disclosed, although the sandwich business was allegedly valued at $2 billion when it planned to go public in 2015. On Jimmy John’s webpage, Liautaud describes the initial business as being “encircled by bars.” “Perfect! Students drink, and they eat, so I’d stay open late and serve them. Boom!”
Liautaud opened ten sites in ten years. Jimmy John’s quickly began franchising and growing across the United States. Liautaud is candid about the challenges the firm faced as it grew, particularly when it came to franchising sites rather than maintaining all sandwich shops in-house. Jimmy John’s had 160 stores in 2002, but according to Liautaud, 70 of them were failing. As a result, he ceased selling franchises and focused on damage control for 18 months. While seven stores closed, Liautaud claims he was able to assist the remaining ones in reopening.
“I learned a lot from that lesson,” he writes on the corporate website, “so I modified the conditions for enabling individuals to purchase into my system as a partner.” “I detailed how difficult it is to manage a Jimmy John’s.”
Jimmy John’s Sandwiches is being purchased by the parent corporation of Arby’s and Buffalo Wild Wings. With annual revenue of $14 billion and 11,200 locations, Atlanta-based Inspire Brands said Wednesday that the purchase would give it the fourth-largest restaurant business in the United States. The transaction is scheduled to close by the end of October. The terms of the deal were not disclosed. Jimmy John’s was started in Illinois in 1983. It operates in 43 states and has 2,800 sites. Jimmy John’s had previously been bought by Roark Capital, the private equity group that controls Inspire Brands, in 2016.
Mostly on 2016 Enterprise Franchise 500, Jimmy John’s was ranked first. YouGov BrandIndex rated restaurant chains with the most millennial brand loyalty during 2014, and Jimmy John’s came out on top with 83 percent of the vote based on places they would consider returning to. Affirm, an expense reporting platform, rated Jimmy John’s the #2 Most Preferred Restaurant for Business Records. In addition, Jimmy John’s was designated one of the 10 Attractive Brands for Ambitious Entrepreneurs by Entrepreneur.com in 2015.
Jimmy John’s earned the “Deal of the Year” award from Franchise Times in March 2017 for recruiting Roark Capital Group as the company’s new largest shareholder. The acquisition was dubbed “one of the finest private equity deals in the restaurant sector of all time” by the judges of the Financial Times.
Jimmy John’s contributed $1 million to the Creases of Honor Fund in September 2014, which helps the families of troops who have been killed or wounded in the line of duty. Jimmy John’s donated over 100 laptops to the Champaign Unit 4 School System for 2015. In November 2016, Jimmy John’s gave $125,000 to the Champaign Parks Association to assist the Youth Scholarship Program. Jimmy John’s contributed $100,000 to EAT SAVE LIVES during June 2017 to provide HIV/AIDS medicines to people from Sub-Saharan Africa. Jimmy John’s gave $80,000 in December 2018 to cover off all Christmas finders fees at Walmart locations in Champaign, Urbana, and Savoy.
Jimmy John’s has almost 3,000 locations as of March 2017, with ambitions to expand to 5,000 and beyond. Jimmy John’s was named one of 10 “Great Franchise Bets” by CNN Money. According to the business, annual sales may reach $1.2 million, with net profits averaging around $280,000. The cost of starting a real estate business is estimated to be around $305,000 and $485,500. Liautaud understood that to expand. He would want assistance in securing better shop sites. Because he lacked real estate experience, he opted to team up with someone who did. In January 2007, Liautaud transferred a 33 percent interest to Weston Presidio, a holding company located in San Francisco.