The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Papa John’s Bahamian comeback is the core of a new $2.5 million franchise group that will create 100 new Bahamian jobs at full-build out, its principal revealed yesterday.

John Wilson, chief executive of PPJ Bahamas, the new local franchisee, said he planned to combine the pizza chain with his existing Menchie’s Frozen Yogurt franchise to create Bahama Franchises Ltd.

He told Tribune Business that Papa John’s planned to achieve “island-wide coverage” of New Providence with five stores opened by mid-2019, and argued that there was “room for another major player” in an already-crowded Bahamian pizza market.

Mr Wilson also disclosed plans to expand Menchie’s beyond its solitary location in the Top-of-the-Hill Plaza on Mackey Street to a three-store chain, taking the group’s combined sites to eight at full build-out.

The first Papa John’s store, which will create 20 new jobs, is scheduled to open in June 2018 “at latest”, with Mr Wilson disclosing that the new franchisee was pushing for April.

“We’ve already identified our first location,” he told this newspaper. “It’s going to be at Top-of-the-Hill Plaza, one store down from Menchie’s. We’re going to create 20 jobs, most of them drivers and the like.”

Mr Wilson disclosed that a second Menchie’s store would open “within the first three months of next year” in the Seagrapes Shopping Plaza on Prince Charles Drive, as the frozen yoghurt franchise sought to extend its market reach to eastern New Providence.

He explained that Bahama Franchises Ltd would become the “umbrella” or parent company for the two franchises which, if expansion plans come to fruition, will have eight stores - five Papa John’s locations, and three for Menchie’s.

“Once we’re fully built out, all in all we would hope to have an additional 100 employees,” Mr Wilson told Tribune Business. “When both brands are fully built-out, we’ll be looking at a total investment of somewhere around $2.5 million. The management team is pretty much already in place and on board.”

Mr Wilson, an attorney and partner at the McKinney, Bancroft & Hughes law firm, disclosed that former senior Royal Bank of Canada (RBC) executive, Larry Wilson, has been hired as Papa John’s chief operating officer and chief financial officer.

He explained that Mr Wilson would run Papa John’s daily operations, and those of the wider franchise group, together with his wife, while he remains focused on his legal duties.

“We’re looking for space out east for a second Papa John’s location, be it Seagrapes or elsewhere,” Mr Wilson said. “Carmichael will be next and then out west, but you’re very limited for locations out west. We just have to be creative and see what we can do.

“We intend to have island-wide coverage [with Papa John’s] by mid-2019. The third Menchie’s will also be out west. I’m under a lot of pressure to find a location for Menchie’s there.

“We have a lot of people who travel to Mackey Street from Old Fort Bay and Lyford Cay. We have a very loyal following, and a lot of customers from all over the island, so we’re constantly being barraged with requests for a new location.”

Mr Wilson said negotiations over the Bahamian franchise with Papa John’s began back in June, after he first expressed interest in it when seeking to bring Menchie’s to this nation.

Pointing out that he had already “made a foray” into the sector with the frozen yoghurt brand, the attorney added: “The franchise business is a very good model in the sense that you are working with a proven concept and proven system.

“I think the Bahamas’ pizza market has room for another player, and believe the consumers had a very positive relationship with Papa John’s when it was here before.

“The brand recognition is already there in a positive way, and given that Papa John’s for 16 of the last 17 years has been ranked as the top pizza chain in the US consumer index, and the Bahamas for the most part follows the US, there’s no question it’s a premium brand and there’s room in the market.”

Papa John’s will be entering a crowded pizza market that is already heavily competitive. While Pizza Hut is also another relatively new entrant, the sector is largely dominated by the likes of Marco’s Pizza and Domino’s Pizza.

The latter two are owned by Aetos Holdings (the Tsavoussis brothers) and BISX-listed AML Foods, respectively, meaning that Papa John’s will have the task of establishing itself and snatching market share from competitors with relatively deep pockets and other revenue sources.

On a wider front, Bahama Franchises Ltd will be up against similar franchise groups including the likes of Aetos Holdings and George Myers’ Myers Group.

Undeterred, Mr Wilson joked: “I’m not chop liver. We’re pretty confident, pretty comfortable, that we have what it takes.” He added that Papa John’s focus will be on providing “a quality product with exceptional customer service”.

While Papa John’s is concentrating on New Providence geographically for the moment, he added that Abaco was being eyed for a possible Menchie’s outlet in Marsh Harbour. Freeport, though, is a different story.

“Freeport will come eventually, but it’s not a priority at the moment,” Mr Wilson told Tribune Business. “The focus is on the major population centres where the economy is thriving to a certain extent, and unfortunately that’s not Freeport.

“I can’t justify the capital investment to go there right now. But Menchie’s has a significant number of customers in the Marsh Harbour area. Every time they come to Nassau, they come to Menchie’s, and have been asking us to come to Abaco.”

Mr Wilson has become a prominent investor in several Bahamian enterprises over the past decade. In 2007, he partnered with now-PLP MP, Chester Cooper, to acquire what has become BAF Financial, the life insurer and financial services provider.

Apart from BAF Financial and the franchises, the attorney also co-founded and helped set up Bahamas Cigarette and Tobacco Company (BC&T), a cigarette and tobacco manufacturer, with business partner Lionel Harris.

Mr Wilson revealed yesterday, though, that he had withdrawn from that business after government tax policy - and the absence of necessary incentives - made local manufacturing non-viable.

“I came out of that business,” he explained. “My partner Lionel Harris is still running it. He’s importing and selling it. You’re paying the same taxes if you manufacture [as if you import], so it didn’t make sense to me. I was trying to create an industry.

“The Government is talking about incentivising Bahamians, so give me an incentive,” he joked. “I’ve learned not to rely on the Government from previous experience.”