This Bankrupt Pizza Chain Has Made a Major Comeback This Year
While some restaurant businesses managed to traverse the uncertain seas of the pandemic era particularly well–fast-food chains with robust takeaway sales and delivery-based restaurants even thrived as the pandemic wore on–most dine-in restaurants saw their revenues decimated.
For beloved West Coast staple California Pizza Kitchen, the pandemic hit was a near knockout blow that came on the heels of many years of faltering business. It had been shrinking for years—from 195 locations in 2010 to 159 a decade later—and finally ended up filing for bankruptcy last year.
Saddled with debt, California Pizza Kitchen had been looking for a buyer before the pandemic hit, according to Restaurant Dive, hoping a buyout would salvage the brand. Once out of bankruptcy by 2021, the company also mulled going public.
Now, CPK is back on the road to expansion and growing sales thanks to a marked shift in its strategy and operation. Formerly run entirely via a corporate-based business model, the company announced it will begin franchising locations across the country, according to the Restaurant Business.
"We're coming out of the pandemic, we have a lot of energy, and we have a lot of ambitions to be able to push the brand beyond some of the typical just opening company stores," said Giorgio Minardi, EVP of global development and franchise operations. "We're trying to be a bit more available to certain markets and certain franchisees."
The blueprint for successful CPK franchises already exists, as the restaurant has several dozen such franchised locations internationally and with just over a dozen franchised locations domestically. But the current U.S. CPK franchises are all in specialty locations, such as airports or sports stadiums.
By entering into franchise agreements with owner-operators running standard California Pizza Kitchen units, the company is poised for growth and increased revenues in coming quarters, potentially returning to markets where locations have closed and pushing into new territories as well.
"The reality is, we are very, very strong in California, and Hawaii and some other areas, but we need to now grow and take advantage of this opportunity that the pandemic has given," Minardi said.
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