Papa Johns 2013 Annual Report Download - page 14

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6฀
฀
Training฀ and฀ Education.฀ The฀ Global฀ Operations฀ Support฀ and฀ Training฀ (“GOST”)฀ department฀ is฀
responsible฀ for฀ creating฀ tools฀ and฀ materials฀ for฀ the฀ training฀ and฀ development฀ of฀ both฀ corporate฀ and฀
franchise฀ team฀ members.฀ We฀ believe฀ training฀ is฀ very฀ important฀ to฀ delivering฀ consistent฀ operational฀
execution.฀Operations฀ personnel฀complete฀ our฀management฀training฀program฀and฀ongoing฀development฀
programs,฀including฀multi-unit฀ training,฀in฀which฀instruction฀is฀given฀on฀all฀aspects฀of฀our฀systems฀and฀
operations.฀
฀
Domestic฀ Point-of-Sale฀ Technology.฀ Our฀ proprietary฀ PROFIT฀ System
TM
,฀ point-of-sale฀ technology฀
(“POS”),฀is฀in฀place฀in฀all฀North฀America฀traditional฀Papa฀John’s฀restaurants.฀We฀believe฀this฀technology฀
facilitates฀ fast฀ and฀ accurate฀ order-taking฀ and฀ pricing,฀ reduces฀ paperwork฀ and฀ allows฀ the฀ restaurant฀
manager฀to฀ better฀monitor฀ and฀control฀food฀and฀labor฀costs,฀including฀ food฀inventory฀management฀and฀
order฀ placement฀ from฀ the฀ domestic฀ QC฀ Centers.฀ We฀ believe฀ the฀ PROFIT฀ System฀ also฀ enhances฀
restaurant-level฀ marketing฀ capabilities.฀ Polling฀ capabilities฀ allow฀ us฀ to฀ obtain฀ restaurant฀ operating฀
information,฀providing฀us฀with฀timely฀access฀to฀sales฀and฀customer฀information.฀The฀PROFIT฀System฀is฀
also฀ closely฀ integrated฀ with฀ our฀ digital฀ ordering฀ solutions฀ in฀ all฀ domestic฀ traditional฀ Papa฀ John’s฀
restaurants,฀enabling฀Papa฀John’s฀to฀offer฀nationwide฀digital฀ordering฀to฀our฀customers.฀We฀plan฀to฀roll฀
out฀our฀next฀generation฀POS฀system,฀which฀ we฀refer฀to฀as฀FOCUS,฀to฀ substantially฀all฀of฀our฀domestic฀
restaurants฀beginning฀in฀2014.฀We฀expect฀FOCUS฀will฀add฀efficiencies฀to฀our฀operations.฀The฀cost฀of฀the฀
system฀ will฀ vary฀ depending฀ on฀ the฀ current฀ equipment,฀ including฀ hardware฀ and฀ wiring,฀ located฀ at฀ each฀
restaurant.฀ Our฀ franchisees฀ will฀ have฀ the฀ option฀ of฀ obtaining฀ financing฀ for฀ the฀ new฀ system฀ from฀ a฀
designated฀lender.฀฀
฀
Domestic฀ Hours฀ of฀ Operation.฀ ฀ Our฀ domestic฀ restaurants฀ are฀ open฀ seven฀ days฀ a฀ week,฀ typically฀ from฀
11:00฀a.m.฀to฀12:30฀a.m.฀Monday฀through฀Thursday,฀11:00฀a.m.฀to฀1:30฀a.m.฀on฀Friday฀and฀Saturday฀and฀
12:00฀noon฀to฀11:30฀p.m.฀on฀Sunday.฀Carryout฀hours฀are฀generally฀more฀limited฀for฀late฀night,฀for฀security฀
purposes.฀฀
฀
Franchise฀Program฀฀
฀
General.฀We฀continue฀to฀attract฀franchisees฀with฀significant฀restaurant฀and฀retail฀experience.฀We฀consider฀
our฀franchisees฀to฀be฀a฀vital฀part฀of฀our฀system’s฀continued฀growth฀and฀believe฀our฀relationship฀with฀our฀
franchisees฀ is฀ good.฀ As฀ of฀ December฀ 29,฀ 2013,฀ there฀ were฀ 3,705฀ franchised฀ Papa฀ John’s฀ restaurants฀
operating฀in฀all฀50฀states฀and฀34฀countries.฀During฀2013,฀356฀(152฀North฀America฀and฀204฀international)฀
franchised฀ Papa฀ John’s฀ restaurants฀ were฀ opened.฀ As฀ of฀ December฀ 29,฀ 2013,฀ we฀ have฀ development฀
agreements฀ with฀ our฀ franchisees฀ for฀ approximately฀ 200฀ additional฀ North฀ America฀ restaurants,฀ the฀
majority฀ of฀ which฀ are฀ committed฀ to฀ open฀ over฀ the฀ next฀ two฀ to฀ three฀ years,฀ and฀ agreements฀ for฀
approximately฀1,000฀additional฀international฀franchised฀restaurants,฀the฀majority฀of฀which฀are฀scheduled฀
to฀open฀over฀the฀next฀six฀years.฀There฀can฀be฀no฀assurance฀that฀all฀of฀these฀restaurants฀will฀be฀opened฀or฀
that฀the฀development฀schedule฀set฀forth฀in฀the฀development฀agreements฀will฀be฀achieved.฀฀
฀
Approval.฀ Franchisees฀ are฀ approved฀ on฀ the฀ basis฀ of฀ the฀ applicant’s฀ business฀ background,฀ restaurant฀
operating฀experience฀and฀financial฀resources.฀We฀seek฀franchisees฀to฀enter฀into฀development฀agreements฀
for฀single฀or฀multiple฀restaurants.฀We฀require฀each฀franchisee฀to฀complete฀our฀training฀program฀or฀to฀hire฀
a฀full-time฀operator฀who฀completes฀the฀training฀and฀has฀either฀an฀equity฀interest฀or฀the฀right฀to฀acquire฀an฀
equity฀interest฀in฀the฀franchise฀operation.฀Outside฀the฀United฀States,฀we฀will฀allow฀an฀approved฀operator฀
bonus฀plan฀to฀substitute฀for฀the฀equity฀interest.฀
฀
North฀America฀Development฀and฀Franchise฀Agreements.฀We฀enter฀into฀development฀agreements฀with฀our฀
franchisees฀in฀North฀America฀for฀the฀opening฀of฀a฀specified฀number฀of฀restaurants฀within฀a฀defined฀period฀
of฀time฀and฀specified฀geographic฀area.฀Substantially฀all฀existing฀franchise฀agreements฀have฀an฀initial฀10-
year฀ term฀ with฀ a฀ 10-year฀ renewal฀ option.฀ We฀ have฀ the฀ right฀ to฀ terminate฀ a฀ franchise฀ agreement฀ for฀ a฀