Christine Specht, CEO of Cousins Subs, led her family-owned sub sandwich chain to an all-time sales record in 2021, which Franchise Times will detail in its Top 500 ranking publishing October 1. As she and other franchise executives face “choppy waters,” as she calls them—inflation, recession, whatever else comes their way—she plans to rely on lessons learned in the past.
Specht was named president of Cousins Subs in 2008, with her father at the helm as CEO until 2015. “Those were choppy waters. At the time, the company itself was so different. We had these legacy issues of entire stores that needed remodeling. We had stores that weren’t in the right spot. The company’s different,” so when people bring up recession and other fears, “it’s like OK, overall we’ve had a really great trajectory,” she said.
“We’ve been here before, but we’re in a very different condition. To be honest with you, I have really great leaders. I’m feeling confident, but not cocky.”
She and her team are pushing for more unit and sales growth next year, and possibly more price increases for the consumer—they hiked menu prices about 5 percent last year—to deal with rising commodities costs.
“Our top 50 items are up 15 percent, dairy, bread, chicken. Our restaurant is not immune from that. And then you kind of have this influence of general inflation, gas prices, you wonder how it takes a toll on people. You could have pullback, people might not have as many visits, or they could take off a side” or otherwise trim their order. “But then it could motivate those who aren’t working to maybe go out and get employment as well,” she said
Will Cousins Subs raise prices? “We will, reluctantly though. You have to be so careful about raising prices. You want to make sure that you’re not alienating your loyal guest base.” Her team regularly checks competitors’ prices, and never wants to be the most expensive but rather somewhere in the middle, “to make sure we’re in the acceptable boundary,” she said.
“My hope is we’ll see some commodity relief at some point. Before we degrade the menu, before we do too drastic a price increase, we do look at where can we save costs where guests won’t realize it. Can we look at some of these contract services, to help save a little bit of money,” she said.
Staffing is “a continual challenge, but we’d like to think it isn’t only about pay. Everybody has the banners out there with very high wages, and we offer a competitive wage as well. We really try to focus on our culture, whether it’s a new employee or someone from another chain,” she said. She is proud of Cousins Subs’ Top Workplace award from the Milwaukee Journal Sentinel, particularly because employees vote for the award winners.
The chain is testing a new rewards system for employees. “They can earn points which can be turned in for gift cards. Maybe they’re on time a certain number of times, or maybe they upsell. In return, besides your pay, you’ll have an extra reward. We’re just testing that, but we’re excited about it, it will be another differentiator,” she said.
She points to another past event—a once-in-a-hundred years one—that bolsters her confidence about the future. “The pandemic threw things upside down. We were able to navigate that pretty well, because we had great team members” willing to work in the stores and do whatever was necessary.
If they got through COVID, they can get through anything. “The resolve that restaurant owners have to have is remarkable. I’m humbled every time I work in our restaurants because it’s not an easy field,” she said.
Part 1 in a series asking CEOs on the Franchise Times Top 500, publishing October 1, how they’re preparing for an uncertain economy.