The story
Founded by James P. Liautaud and Jimmy John Liautaud in 1983.1
Founding
After Liautaud graduated second to last in his class at Elgin Academy in 1982, his father gave him a choice to either join the Army or start a business. Although his father wanted him to enlist, the younger Liautaud chose the latter, and his father agreed to loan him $25,000 in exchange for a 48% stake in the business. Initially, Liautaud wanted to open a hot dog stand, but after visiting numerous such stands throughout the summer of 1982, he realized the $25,000 would not be enough for such a venture. After a chance encounter at a sandwich shop, he realized that he could open a sandwich shop within his available budget by purchasing premium meats at a neighborhood market and baking his own bread. With the help of his family as tasters, he decided to put four sandwiches on his original menu. Paying $200 a month in rent, Liautaud could afford only used equipment consisting of a refrigerator, a chest freezer, an oven, and a meat slicer.
On January 13, 1983, Jimmy John's Gourmet Sandwiches opened in Charleston, Illinois. Due to the poor location of his first store, Liautaud decided to include delivery of his sandwiches to boost sales. He began by bringing samples door-to-door to the dorms of nearby Eastern Illinois University, which he had attended for one semester.
By the end of his first year, the restaurant started making a profit. In April 1985, Liautaud bought out his father's interest in the business, becoming the sole owner. In 1986, he opened his second store in Macomb, Illinois, and in 1987, he opened a third in Champaign, Illinois.
Late 20th century
In 1988, Liautaud met Jamie Coulter, who at that time was a Pizza Hut franchisee and would later become the CEO of Lone Star Steakhouse & Saloon. Coulter mentored Liautaud and "taught [him] how to effectively run multiple units." Liautaud continued opening more stores and developed a prototype before beginning franchising in 1994. In 1994, he sold his first Jimmy John's franchise, in addition to the 10 stores owned by Liautaud himself.
The first franchise store opened in Eau Claire, Wisconsin. In 2001, the hundredth Jimmy John's store opened in Mt. Pleasant, Michigan. By 2002, the company had about 200 stores, 10% of which were corporate stores that Liautaud oversaw himself. However, Liautaud noticed that sales at the stores he owned were outpacing the franchised stores by a wide margin.
Liautaud stopped selling franchises for one year to give support to stores that were struggling. Together with his partner, and now president & CEO, James North, he visited 70 of the poorest-performing stores. After 18 months of getting the stores "back to basics" and instilling in them "some of that initial spark", he was able to help the stores become more profitable.
21st century
In 2007, the 500th store opened in Seattle, Washington, and in 2010, the 1,000th opened in Beaverton, Oregon. As of March 2017, Jimmy John's had almost 3,000 stores with plans for expansion up to 5,000 and beyond. Liautaud realized that, in order to grow, he would need help acquiring better locations for his stores. Since he had little expertise in real estate, he decided to take on a partner who did. In January 2007, Liautaud sold a 33% stake to Weston Presidio, a San Francisco–based private-equity firm. In the first year after partnering with Weston Presidio, 100 real estate deals were closed. The company has completed two recapitalizations since Weston Presidio's investment.
In the summer of 2015, pictures of Liautaud posing with big game circulated on social media, leading to increased calls to boycott his restaurants. In a 2015 interview with the Chicago Tribune, Liautaud said, "I don't hunt big African game anymore."
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In September 2016, Jimmy John's announced that Roark Capital Group had agreed to acquire a majority stake in the company. Terms of the transaction were not immediately disclosed, though it was later clarified that Liautaud retained 35% ownership of the company as part of the deal. As part of the agreement, Liautaud would continue as chairman of the board.
On September 25, 2019, Inspire Brands (affiliated with Roark Capital Group) announced that it was buying Jimmy John's for an unspecified amount in a deal unanimously approved by Liautaud and the rest of the Jimmy John's board of directors. At the close of the deal, Liautaud would step down as chairman of the company and transition to become an adviser to the brand. The acquisition was completed on October 18.
Labor relations
In 2010, when the Industrial Workers of the World attempted to unionize ten Minneapolis locations, The New York Times called the effort "one of the few efforts to organize fast-food workers in American history". In July 2017, the United States Court of Appeals for the Eighth Circuit found that the National Labor Relations Act did not protect Jimmy John's employees from being fired for exhibiting legally disloyal conduct by attacking the company's product to oppose a franchisee's sick leave policy.
In October 2014, it was revealed that employees at Jimmy John's, including sandwich makers and delivery drivers, were required to sign non-compete agreements as a condition of employment. The agreement restricted the employee from working for a competitor for two years, where a competitor was defined as a business that derives more than ten percent of its revenue from selling sandwiches and is located within three miles of any Jimmy John's. Additionally, the employee could not work for another Jimmy John's franchisee for a year. Jimmy John's has since settled related lawsuits filed by the Attorneys General of New York and Illinois. In statements, the company clarified that it had taken steps to remove non-compete agreements from their new hire paperwork long before they were contacted by the Attorneys General, and that "enforcement of non-compete agreements against our own hourly store employees is not a part of Jimmy John's culture or business model."
From Wikipedia’s article on Jimmy John's, shared under CC BY-SA 4.0.4