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Papa John's International Inc. Message Board

  • mr_donato mr_donato Dec 1, 1999 2:50 PM Flag

    THE WORST NEWS POSSIBLE FOR PZZA!

    McDonalds has just bought all Boston Market
    locations and one of the things they plan to do is turn
    them into Donato's Pizza.

    Just imagine how many
    Boston Markets McDonalds will turn into Donato's
    Pizza.

    We knew it, McDonalds is going to become a big
    player in the Pizza Business. They have the muscle to
    conquer.

    Papa Who?

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    • << McDonalds has just bought all Boston
      Market locations and one of the things they plan to do
      is turn them into Donato's
      Pizza.>>

      What the press release told us was that McDonalds
      purchased 859 existing locations (within 33 states) + the
      franchise rights to 108 (as yet non-existing, unoperating
      units) for $173.5 million, or $231,025 per EXISTING,
      OPERATING, potentionally profit generating
      unit.

      Furthermore, it told us that MCD intends to convert SOME OF
      these 751 EXISTING and SOME OF these 108 potentially
      existing sites THAT IT DOESN'T RETAIN AS BOSTON MARKET
      sites to

      • 1 Reply to GenJackripper
      • (Accidentally pulled the trigger
        prematurely.)

        Furthermore, it told us that MCD intends to convert SOME OF
        these 751 EXISTING and SOME OF these 108 potentially
        existing sites THAT IT DOESN'T RETAIN AS BOSTON MARKET
        sites to:

        a) McDonalds
        b) Chipotle Mexican
        Grill
        c) Donato's Pizza

        So we have 751 existing
        sites potentially diversified among 4 restaurant names,
        or an average of about 188 units per name which, if
        they were applied to the 33 states BOST is in,
        averages < 6 units per state.

        PZZA, by
        comparison has, as its most recent pr tells us, 2201 units
        throughout the United States + 5 international markets.


        PZZA's web site apparently indicates that the U.S.'
        territorial possession of Puerto Rico is considered an
        "international" market. If I were a citizen and resident of
        Puerto Rico, and found myself being listed as being in
        an "international" market, I'd consider that an
        insult
        and let those insensitive sorts at corporate know
        what they could do with their pizza.

        Be that
        as it may, there are a total of 24 units listed
        under the 5 international markets, leaving 2,177
        stateside. The General is fairly certain that PZZA does not
        have units within all 50 states but does not recall
        the exact number of states that it's in. If we're
        talkin' 35 states, that's an average of 62+ per state. 40
        states would be 54+ units per and 45 states would be 48+
        units per state. Anyway, comparison-wise, that'd be
        somewhere between 8 to 10 times the number of Donato's
        conversions MCD might have (if averaged) in the 33
        state/markets it's buying (@ $231,025 per existing
        unit).

        Last Monday, by contrast, we learned that PZZA is
        buying 205 Perfect Pizza units for $32.5 million, or
        $158,537 per existing unit over in England. $231,025
        versus $158,537 per existing unit. That's 45+% more per
        acquisition cost per unit. Put another way, PZZA's acquired
        units cost slightly more than 2/3rds (per unit) of what
        MCD's cost. Pizza-wise, is everything else over in
        England cost 2/3rds of domestic costs? Who has to sell
        more pizza's per unit to make costs? MCD's Donato's or
        PZZA's (formerly) Perfect Pizza?

 
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