Fast-Growing Papa Johns Franchisee Talks Turnarounds as Path to Scale | Franchise News


Chris Patel has learned a lot about what works and what doesn’t work while growing his Papa Johns portfolio from four to 70 locations since the height of the COVID-19 pandemic.

The biggest mistake for the 30-year-old franchisee? Believing early on that raising prices was going to turn things around at his lower performing stores. He said that strategy backfired badly, leading to a decline in revenue and employee morale.

“It took me some time to realize what we were doing wrong, but once we did and refocused our efforts on empowering our store employees and providing them incentive bonuses for their good work was when everything started moving in the right direction for us,” said Patel, the COO and equal partner of Benton, Pennsylvania-based Pie Investments.

Patel said his Papa Johns restaurants in five Mid-Atlantic states grossed $50 million in sales in 2024. His stores are performing above the systemwide average unit volume of $1.2 million, with his top locations posting AUVs over $2 million.







Chris Patel

Pie Investments CEO Chris Patel owns 70 Papa Johns units. His goal is to increase that number to 250 in the next five years. 


Patel’s rapidly growing restaurant company—he has more than 1,000 employees—added 20 Papa Johns last year and has grown overall sales 35 percent in just the last few years. Twelve stores are projected to open this year and he’s looking to acquire another 20 or 30 units. The five-year goal is to reach 250 locations. 

His largest acquisition to date was the 27 units he purchased in and around Philadelphia in 2022 from the Hunt Group.

“Of the 70 stores we own, we’ve probably acquired 62 of them. We’re not afraid to build new ones now with our real estate and construction infrastructure,” said Patel. “We’ve added six new restaurants through development in the last few years, with two of them that are ready to open at the end of January.

“We’re cranking up the heat on development now as we move forward and capture new customers in the right markets.”

With degrees in finance and corporate law and a background in private equity, Patel got his start in franchising after college when he worked on a Dunkin’ franchisee’s merger and acquisitions efforts. At 26, he took a leap of faith by taking over the management of four struggling Papa Johns in South Jersey in 2019. A year later, Patel raised the money needed from private investors to purchase the New Jersey units prior to acquiring 27 units in Pennsylvania.

Patel’s sights are set on becoming the largest franchisee in the Papa Johns system. He’s pleased with the growth trajectory his company is on, but what he prefers to talk about is how Pie Investments has transformed underperforming stores.

“When we bought our first group of restaurants in Philadelphia, we were under the false impression that pricing our food items higher would bring more revenue through the door,” Patel said. “We were trying to drive sales that way and not through our number of transactions, and that was our mistake.

“We know now that the healthiest and smartest way to grow sales is through the number of transactions you make,” he said

The most challenging part of being a multi-unit franchisee? Patel goes back to his initial startup phase when he hired and trained managers who took pride in their hourly employees and the success of their stores.

“Getting the first four units right was the hard part. Once we got to 20 and then 50 units it got easier because we had built the infrastructure to support our growth,” he said. “Because of that I’m very confident we can reach our goal of 250 Papa Johns.”

Papa Johns, which is ranked No. 21 on the Franchise Times Top 400 with more than $5 billion in global sales, opened its 6,000th location in 2024. The brand, however, is in the midst of a sales slump. 

North American same-store sales declined 2 percent in the first quarter last year, and slid again by 4 percent in the second. The company’s third-quarter results showed a 6 percent same-store sales dip, and in its preliminary fourth quarter financial results it reported a 4 percent decline. Transactions and tickets were each down 2 percent.

New CEO Todd Penegor said at the ICR investor conference this month that the brand needs to chase transactions harder. Also in the works is a return to local marketing.

 

 



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