This post is part of the On the Margin blog.
Famous Dave’s of America Inc. is changing CEOs again.
The struggling Minneapolis-based barbecue chain late on Wednesday named Michael Lister, one of the chain’s top performing franchisees, to replace Adam Wright as CEO. Lister who has been a franchisee with Famous Dave’s since 2001, was also named chief operating officer.
Wright, an activist investor who was elevated to the CEO job only last year, also resigned from the board of directors.
“Mike Lister’s deep expertise in the restaurant industry, along with his demonstrated success as a Famous Dave’s franchise owner, gives us full confidence that he is the right leader to continue the efforts to turn Famous Dave’s around,” Famous Dave’s Chairman Joseph Jacobs said in a statement.
The move continues an incredible run of monumental changes at the 176-unit chain. Lister becomes the fourth CEO at the chain since 2012. None of them stayed longer than 18 months amid struggling sales and activist investor involvement.
It also comes amid a nearly unprecedented change in the CEO suite at the country’s restaurant chains amid a broad decline in sales. Seventeen companies, including publicly traded companies like Cosi, Noodles & Co. and Ruby Tuesday Inc., have replaced their CEOs in recent months. And that doesn’t include top executives like Mike Andres, the president of McDonald’s USA.
But Famous Dave’s has struggled in the past couple of years. And the problem has been most acute at company locations. Same-store sales at company-owned restaurants have fallen 17.2 percent on a two-year basis in the second quarter ended July 3. The sales decline has taken a hit on the company’s financials — last year, the company had to renegotiate its credit deal after defaulting on financial requirements in its loan agreement.
The stock had oddly rallied in 2014 and early 2015 behind interest in the chain from several activist investors and the presence of former McDonald's Corp. executive Ed Rensi. But it has lost 85 percent of its value since hitting a peak of more than $34 a share in February of last year. That swoon has now cost two CEOs of the chain their jobs.
In Lister, the company is appointing one of the chain’s top franchisees, perhaps in the hopes that he will help reverse Dave’s fortunes.
Lister was senior vice president of operations from 1997 to 2001 before becoming a franchisee. He currently operates restaurants in Tennessee and is chairman of Famous Dave’s Franchise Advisory Board.
“I look forward to working side-by-side with the strong team of talented professionals that make up our management team. Each has the passion and commitment to move us forward Famously,” Lister said in a statement.