Papa John's International Profile
Papa John's International, Inc. (Papa John's) operates and franchises pizza delivery and carryout restaurants and, in certain international markets, dine-in and delivery restaurants under the trademark 'Papa Johns'.
The company has various restaurants in operation, consisting of company-owned and franchised restaurants operating in 50 countries and territories. The company-owned restaurants include some restaurants operated under three joint venture arrangements. In discussions of the company's business, 'Domestic' is defined as within the contiguous United States, 'North America' includes Canada, and 'International' includes the rest of the world other than North America.
Strategy
The company's strategic priorities are to build a culture of leaders who believe in diversity, inclusivity and winning; re-establish the superiority of the company's pizza via commercial platforms; improve unit-level profitability and performance of the company and franchisee restaurants; leverage the company's technology infrastructure to drive its business operations; and profitably expand the company's footprint domestically and internationally.
The company's Domestic Company-owned restaurant growth strategy is to continue to open restaurants in existing markets as appropriate, thereby increasing consumer awareness, increasing market share, improving customer service and enabling the company to take advantage of operational and marketing scale efficiencies. The company has co-developed Domestic markets with some franchisees or divided markets among franchisees and will continue to use market co-development in the future, where appropriate. The company's Domestic Company-owned markets are consisted of strong performing restaurants and make them attractive locations either as company-owned or franchised. Similarly to the company's Domestic Company-owned restaurant growth strategy, the company's International strategy has shown to build higher consumer awareness and increased market share.
Segments
Papa John's has four defined reportable segments: Domestic Company-owned restaurants, North America franchising, North America commissaries (Quality Control Centers), and International.
Domestic Company-owned Restaurants
The Domestic Company-owned restaurant segment consists of the operations of all Domestic Company-owned restaurants and derives its revenues principally from retail sales of pizza, Papadias, and side items, including breadsticks, Papa Bites, cheesesticks, boneless chicken wings and bone-in chicken wings, dessert items and canned or bottled beverages.
Operating Company-owned restaurants allows the company to improve operations, training, marketing and quality standards for the benefit of the entire Papa John's system.
North America franchising
The North America franchising segment consists of the company's franchise sales and support activities and derives its revenues from the sale of franchise and development rights and the collection of royalties from the company's franchisees located in the United States and Canada.
North America commissary
The North America commissary segment comprises 11 full-service regional dough production and distribution centers (Quality Control Centers, or 'QC Centers') in the United States, which supply pizza sauce, dough, food products, paper products, smallwares and cleaning supplies twice weekly to each traditional restaurant served. This system enables the company to monitor and control product quality and consistency while lowering food and other costs. The company also has one QC Center in Canada, which produces and distributes fresh dough. The company evaluates the QC Center system capacity in relation to existing restaurants' volumes and planned restaurant growth, and facilities are developed or upgraded as operational or economic conditions warrant. To ensure consistent food quality, each Domestic franchisee is required to purchase dough and pizza sauce from the company's QC Centers and to purchase all other supplies from the company's QC Centers or other approved suppliers.
International
The International segment is defined as all restaurant operations outside of the United States and Canada. The company operates International restaurants, consisted of company-owned restaurants in the U.K. and franchised restaurants. The company operates one International QC Center in the U.K. The International segment also consists of distribution sales to Papa John's restaurants located in the U.K. and the company's franchise sales and support activities, which derive revenues from sales of franchise and development rights and the collection of royalties from the company's International franchisees. Other QC Centers outside North America are operated by franchisees pursuant to license agreements or by other third parties.
All others
All other business units that do not meet the quantitative thresholds for determining reportable segments, which are not operating segments, are referred to as 'all others.' These consist of operations that derive revenues from franchise contributions to the company's marketing funds and the sale, principally to company-owned and franchised restaurants, of information systems and related services used in restaurant operations, including the company's point-of-sale system, online and other technology-based ordering platforms, and printing and promotional items. In the fourth quarter of 2023, the company sold Preferred Marketing, the company's previously wholly-owned print and promotions company.
Government Regulation
The company is subject to Federal Trade Commission ('FTC') regulation and various state laws regulating the offer and sale of franchises.
Trademarks, Copyrights and Domain Names
The company has registered and maintains Internet domain names, including 'papajohns.com', and country code domains patterned as 'papajohns.cc', or a close variation thereof, with '.cc' representing a specific country code.
History
Papa John's International, Inc. was founded in 1984. The company was incorporated in 1991.
