Panera’s founder speaks from the heart, plus more
Mort Aronson with some of his franchise students at Emory Law during a visit by Franchise Times.
Third-year law students at Emory University School of Law in Atlanta filed into Mort Aronson’s class on a late Wednesday afternoon, as they have every fall semester for the past 24 years. “How ya doing,” the 83-year-old Aronson will say to this student or that. “Hangin’ tough,” each replies with a grin. And why is that? “Because tough times don’t last but tough people do,” each will say, repeating one of Aronson’s favorite phrases and showing the sweet rapport he creates with his 25 franchise law students from all over the world. Aronson was general counsel for Holiday Inn (before it became IHG), working for the brand for 25 years until 2003 when he was 68 years old. “I took Saturday off and then Sunday I went in to Kilpatrick,” the law firm now called Kilpatrick Townsend in Atlanta with a robust franchise practice headed then and now by Rupert Barkoff. He said his greatest honor at Holiday Inn was when franchisees named him an honorary member of their franchisee advisory counsel, a rare designation for a general counsel whose job it is to advocate for the franchisor. “I always did my best to be fair, even if being fair meant the top CEO disagreed,” he said.
Panera Founder Speaks
The founder of Panera railed against what he called short-termism in opening remarks at the Restaurant Finance & Development Conference in November. “The pervasive short-termism found in our capital markets is not only bad for our economy but bad for our country. As a society we must recognize the ways our markets are mis-serving our collective needs,” said Ron Shaich, who led Panera for 26 years through what he described as four long-term transformations, to 2,368 units, $6 billion in system sales, 11 million meals a week and a sale to JAB Holding Co. for just shy of $8 billion. Shaich was refreshingly candid about the personal toll fights with activist investors have on businesses. He detailed Panera’s case in emotional terms. “Each time we got attacked, it took a powerful toll on our team. We got distracted. The reality is, if I didn’t own 17 percent of Panera and if I didn’t have the track record that I had, what would have happened? All of those things that seem so smart today would never have been able to get done,” he said.
“I wanted to talk about what activism feels like. People say it’s lonely at the top. But nothing’s more lonely than facing that the thing you spent your life working on” could be dismantled. “Here’s the fear, the vulnerability that I felt. It was the loss of control of Panera. Why? It’s all those people in the organization that believed in me.”
Flynn’s Big Buy
The acquisition of U.S Beef Corp.’s restaurants by Flynn Restaurant Group is huge by any measure. In all, it was 368 restaurants with annual sales of $400 million. That means the Flynn Restaurant Group, which was the first business on the Restaurant 200 to crest $1 billion, is now the first to top $2 billion with $2.3 billion in projected annual sales. Flynn told Franchise Times that U.S. Beef Corp., the seller, was a key attraction.“It’s a great company, a 50-year-old business, a third-generation business. They’re great operators in very desirable locations: Oklahoma, Arkansas, Missouri, Kansas Colorado—just great Arby’s markets,” said Flynn. “And they really know their business; having been doing it for literally decades, and the whole team came with us.”
Pure Barre Boss
Christina Russell, CEO of Pure Barre since last April, is out and looking for new opportunities following the acquisition of the boutique fitness concept by Xponential Fitness.
“They have a central founder/CEO, and there really isn’t room for a second CEO, so I’m passing the baton. It’s been a great experience working with L Catterton toward a successful exit, and it’s been a positive experience overall,” she wrote to business colleagues. Russell is a dynamic executive who was the first outside CEO at Camp Bow Wow.