Papa John's Has Lost Its Papa

Phillip Cunningham
December 24, 2017

Schnatter will be replaced as chief executive by Chief Operating Officer Steve Ritchie on January 1, the company announced Thursday.

Surprised at all? He did it to himself.

Papa John's has faced waning sales recently and its stock price is down more than 30 percent so far this year. That has reduced Schnatter's 9.5 million share stake in the company by almost $84 million.

The company gave no reason for the change, but it comes after the public relations disaster when Schnatter shared his thoughts about players who took a knee during the national anthem to protest the treatment of black Americans, particularly by police.

He founded Papa John's more than 30 years ago and owes a large part of his personal fame to advertising with the National Football League, as well as Peyton Manning's ties to the company.

Schnatter offered praise for Ritchie, saying "I am so proud of Steve...we couldn't have a more proven leader to guide Papa John's through its next stage of growth".

After Schnatter's comments, white supremacists vowed to make Papa John's the official pizza of the so-called alt-right.

John Schnatter owns nearly 9.5 million shares of Papa John's International Inc., valued at more than $560 million. Since then, it has grown to more than 5,000 locations. Schnatter, who founded the chain, endorsed Trump for president. It's not the first time Schnatter has stepped down. The company said later Thursday that it had "no plans to remove John from our communications", which it says includes pizza boxes or commercials. The pizza chain apologized for the comments in a Twitter post several weeks later. McDonald's Corp., for example, expects to increase delivery from 5,000 of its almost 14,000 US locations by the end of the year.

Ritchie joined Papa John's 21 years ago as a minimum wage employee making pizzas and answering phone calls. That's a strategy that has worked for Domino's, which takes orders from tweets, text messages and voice-activated devices, such as Amazon's Echo.

"The world is evolving and changing", he said. Steve Ritchie will take over as chief executive. Whether Schnatter will continue as spokesman has not been decided, Ritchie said.

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