Jimmy John's

Jimmy John's Franchise, LLC is an American franchised sandwich fast food restaurant chain owned by Inspire Brands and specializing in delivery. It was founded by Jimmy John Liautaud in 1983 and is headquartered in Champaign, Illinois. In 35 years, the company has grown to more than 2,800 locations[2][1] in all states except Alaska, Connecticut, Hawaii, Maine, New Hampshire, Rhode Island and Vermont.[3] As of 2014, 98% of the locations are franchise-owned.[4]

The original Jimmy John's shop in Charleston, Illinois, opened January 13, 1983.
"Jimmyjohns" redirects here. For the type of container, see carboy.

Jimmy John's Franchise, LLC
Subsidiary
Industryfood industry 
Founded1983 (1983)
FounderJimmy John Liautaud
Headquarters
Champaign, Illinois
,
United States
Number of locations
2,800 (October 2018)[1]
Key people
James North (President)
OwnerInspire Brands
Websitejimmyjohns.com
Jimmy John's Founder, Jimmy John Liautaud

History
A Jimmy John's in Gillette, Wyoming

After Jimmy John Liautaud graduated second to last in his class at Elgin Academy (1982), his father gave him the choice to join the military or start a business.[5] Liautaud chose the latter, and his father lent him $25,000 to start a hot dog business, with the son owning 52% of the business, and his father owning 48%.[6] He soon realized that a hot dog business would cost more than he had, so he decided to open a sandwich shop.[7][8]

On January 13, 1983, the first Jimmy John's opened in a garage in Charleston, Illinois. Paying $200 a month in rent, Liautaud could only afford used equipment consisting of a refrigerator, a chest freezer, an oven, and a meat slicer.[9]

The store was able to realize a profit its first year of business, despite the poor location of the store, due to Jimmy John's willingness to deliver his sandwiches to the nearby dorms at Eastern Illinois University, as well as his handing out free samples for marketing purposes.[3][7]

In April 1985, Liautaud bought out his father's interest in the business, becoming the sole owner. In 1986, he opened his second store in Macomb, Illinois, and in 1987, he opened a third in Champaign, Illinois.

In 1988, Liautaud met Jamie Coulter, who would later become the CEO of Lone Star Steakhouse & Saloon. Coulter mentored Liautaud and "taught [him] how to effectively run multiple units."[7]

Liautaud continued opening more stores and developed a prototype before beginning franchising in 1994. Franchising continued until 2002 when Liautaud stopped selling franchises for one year to give support for stores that were struggling.[10] The first franchise store opened in Eau Claire, Wisconsin. In 2001, the hundredth Jimmy John's store opened in Mt. Pleasant, Michigan. In 2007, the five-hundredth store opened in Seattle, Washington, and in 2010, the thousandth opened in Beaverton, Oregon.[11]

As of March 2017, Jimmy John's has almost 3,000 stores with plans for expansion up to 5,000 and beyond.[12]

CNNMoney listed Jimmy John's as one of ten "Great Franchise Bets." The company estimates that annual sales can be as high as $1.2 million while net profits can average at about $280,000. Real estate start-up costs are estimated to be between $305,000 and $485,500.[9]

Liautaud realized that in order to grow he would need help acquiring better locations for his stores. Since he had little expertise in real estate, he decided to take on a partner who did. In January 2007, Liautaud sold a 33% stake to Weston Presidio, a San Francisco–based private-equity firm.[13] In the first year after partnering with Weston Presidio, 100 real estate deals were closed.[7]

The company has completed two recapitalizations since Weston Presidio's investment.[14]

In the summer of 2015, pictures of Liautaud posing with big game circulated on social media, leading to increased calls to boycott his restaurants. In an interview in 2015 with the Chicago Tribune, Liautaud said, "I don't hunt big African game anymore."[3]

In September 2016, Jimmy John's announced that Roark Capital Group had agreed to acquire a majority stake in the company. Terms of the transaction were not immediately disclosed, though it was later clarified that Liautaud retained 35% ownership of the company as part of the deal.[15] As part of the agreement, the company's founder and largest individual shareholder Jimmy John Liautaud will continue as chairman of the board.[16][17]

On September 25, 2019, Inspire Brands announced that it was buying Jimmy John's for an unspecified amount in a deal unanimously approved by Liautaud and the rest of the Jimmy John's Board of Directors.[18] At the close of the deal, Liautaud will step down as chairman of the company and transition to become an adviser to the brand.[19][20][21] The acquisition was completed on October 18.[22]

Labor relations

In 2010, when the Industrial Workers of the World attempted to unionize ten Minneapolis locations, The New York Times called the effort "one of the few efforts to organize fast-food workers in American history."[23] In July 2017, the United States Court of Appeals for the Eighth Circuit found that the National Labor Relations Act did not protect Jimmy John's employees from being fired for exhibiting legally disloyal conduct by attacking the company's product to oppose a franchisee's sick leave policy.[24][25]

In October 2014, it was revealed that employees at Jimmy John's, including sandwich makers and delivery drivers, were required to sign non-compete agreements as a condition of employment.[26][27] The agreement restricted the employee from working for a competitor for two years, where a competitor was defined as a business which derives more than ten percent of its revenue from selling sandwiches and is located within three miles of any Jimmy John's. Additionally, the employee could not work for another Jimmy John's franchisee for a year.[28] Jimmy John's has since settled lawsuits filed by the Attorneys General of New York And Illinois on this matter. In statements, the company clarified that it had taken steps to remove non-compete agreements from their new hire paperwork long before they were contacted by the Attorneys General, and that "Enforcement of non-compete agreements against our own hourly store employees is not a part of Jimmy John’s culture or business model."[29]

Jimmy John's has 5 bread options including French, 9-Grain, Thick-Sliced Wheat, 6 inch "Lil' John" (smaller version of French bread) and Unwich. Jimmy John's has 17 different numbered sandwiches plus a B.L.T., called the J.J.B.L.T, and the Gargantuan, a combination of all the meats.. The 17 sandwiches may have ham, roast beef, tuna, turkey, salami, capicola, bacon, or provolone cheese or combine 2 or more meats and cheese. Jimmy John's has five flavors of chips including Regular, BBQ, Jalapeño, Salt and Vinegar, and Thinny. The menu also includes kosher dill pickles as well as triple chunk chocolate and oatmeal raisin cookies.[30]

Awards

Jimmy John's was named #1 on the Entrepreneur 2016 Franchise 500.[31] In 2014, YouGov BrandIndex ranked restaurant chains that have the highest millennial brand loyalty, and Jimmy John's topped the ranking with 83% of the vote based on restaurants they would consider going to again.[32] Jimmy John's was named the #2 Most Popular Restaurant for Business Meals by expense reporting program Certify.[33] In 2015, Entrepreneur.com named Jimmy John's one of the 10 Promising Franchises for Ambitious Entrepreneurs.[34] In March 2017, Jimmy John's won Franchise Times' "Deal of the Year" for attracting Roark Capital Group as the company's new majority owner. FT's judges called the deal "one of the best private equity deals of all time in the restaurant business."[35]

Philanthropy

In September 2014, Jimmy John's donated $1 million to the Folds of Honor Foundation, a foundation which supports the families of killed or disabled soldiers.[36] During the 2015 school year, Jimmy John's donated more than 100 laptop computers to the Champaign Unit 4 School District.[37] Jimmy John's donated $125,000 to the Champaign Parks Foundation to support the Youth Scholarship Program in November 2016.[38]

In June 2017, Jimmy John's donated $100,000 to EAT (RED) SAVE LIVES to offer HIV/AIDS medication in sub-Saharan Africa.[39]

In December 2018, Jimmy John's donated $80,000 to pay off all Christmas layaways at Walmarts in Champaign, Urbana, and Savoy.

Sponsorships
Liautaud with Jimmy John's driver Kevin Harvick & others

Starting in 2007, Jimmy John's began sponsoring NASCAR, first with Steven Wallace in 2007 and 2008. In 2009 and 2010, Jimmy John's sponsored Kevin Harvick in the NASCAR Nationwide Series.[40] In 2011, Jimmy John's and Richard Childress Racing reached a multi-year agreement to sponsor Harvick for the Sprint Cup Series. The 2014 sponsorship continued with Harvick and the Stewart-Haas Racing team.[41] On September 13, 2014, Jimmy John's became the title sponsor of the Jimmy John's Freaky Fast 300 at Chicagoland Speedway.[42] Harvick won the 2014 NASCAR Sprint Cup Championship, giving Jimmy John's their first championship. From 2010 to 2019, Jimmy John's entered into an Ultimate Fighting Championship sponsorship with Brock Lesnar with logos appearing on his trunks. This sponsorship extended to WWE upon Lesnar's return to that company in 2012, making him the only WWE performer in history to be permitted such a deal.[43]

In 2015, Jimmy John's co-sponsored the RCH Factory Racing Supercross and Motocross team featuring Ken Roczen. The team contested both the Monster Energy AMA Supercross and the Lucas Oil Pro Motocross championships.[44] In June, Jimmy John's sponsored former NASCAR champion Rusty Wallace for his Speed Energy Formula Off-Road debut at the 2015 X Games.[45]

In June 2015, it was announced that Jimmy John's purchased the naming rights to the Utica, Michigan baseball stadium which is the current home of the three teams in the newly formed United Shore Professional Baseball League.[46] Jimmy John's Field opened on May 30, 2016.[47][48]

Other Jimmy John's sponsorships include the Boston Red Sox, Chicago Blackhawks, Detroit Red Wings, Houston Astros, Nashville Predators, St. Louis Cardinals, Seattle Mariners and the GoDaddy.com Bowl among many others.[49]

Jimmy John's owners have also supported local organizations in their communities. Two such sponsored organizations include the Utah Youth Soccer Association[50] and the Arizona Soccer Association.[51]

Founder Jimmy John Liautaud is a supporter of Donald Trump and has donated at least $100,000 to President Trump's 2020 reelection bid.[52]

FDA Warning

On February 21, 2020, the U.S. Food and Drug Administration sent an FDA warning letter to Jimmy John's [53] detailing evidence from five outbreaks of human infections with Escherichia coli (E. Coli). The letter said that the evidence demonstrates that the company engaged in a pattern of receiving and selling spoiled produce, specifically clover sprouts and cucumbers. In the letter, the FDA says the Iowa Department of Public Health reported that, as of January 2020, a total of 22 people were infected with the outbreak strain of E. coli. "20 of the 22 case individuals were interviewed by the Iowa Department of Public Health," the FDA says. "Of the case individuals interviewed, 100% reported eating at one or more of 15 Jimmy John’s restaurants." The FDA gave the company 15 days to respond and include specific steps it is taking to address the violations.

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See also

References
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  3. Bomkamp, Samantha (November 3, 2015). "Jimmy John's founder opens up on expansion, big game hunting, possible IPO". Chicago Tribune. Retrieved June 1, 2016.
  4. "10 Things You Didn't Know About Jimmy John's". The Daily Meal. June 3, 2014. Retrieved June 6, 2016.
  5. "Reece: The ABCs of success in business". Northwest Herald. February 19, 2013.
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  7. "Success Stories: Jimmy John Liautaud". SUCCESS Magazine. March 4, 2009. Archived from the original on July 15, 2018. Retrieved June 6, 2016.
  8. "10 Things You Didn't Know About Jimmy John's - Facts & Trivia". Thrillist. May 10, 2015. Retrieved June 6, 2016.
  9. "10 Great Franchise Bets - Jimmy John's". CNN Money. June 16, 2011. Retrieved June 6, 2016.
  10. "Jimmy John's Sandwiches Business Overview". Franchising.com. Retrieved July 7, 2016.
  11. "1000th store".
  12. Ewen, Beth (March 22, 2017). "How Jimmy John's landed FT's deal of the year". Franchise Times. Retrieved April 2, 2017.
  13. "Jimmy Johns stake sold". Chicago Tribune. January 4, 2007. Archived from the original on January 6, 2007. Retrieved June 1, 2016.
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  17. Frost, Peter (September 8, 2016). "Arby's owner buys Jimmy John's majority stake". Crain's Chicago Business. Retrieved September 15, 2016.
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  19. Lucas, Amelia (September 25, 2019). "Arby's owner Inspire Brands buys Jimmy John's". CNBC. Retrieved September 26, 2019.
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  43. "The pro wrestling post: WWE stock, Lesnar's sponsors and TNA-Bellator working together?". mmapayout.com.
  44. "Ken Roczen signs with RCH racing". May 2015.
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  47. Kevin Reichard (May 30, 2016). "New Utica Ballpark a Springboard for League Expansion". Ballpark Digest.
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  51. "ASA & Jimmy John's Announce Partnership". Arizona Youth Soccer Association. Retrieved June 6, 2018.
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  53. "WARNING LETTER, FY2020-HAFE6-01". Retrieved April 13, 2020.
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