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Jack in the Box franchisee group calls for removal of CEO

Members: Executive team restructuring necessary to make brand ‘viable’

A group representing a majority of Jack in the Box restaurants have called for the removal of CEO Leonard Comma and a restructuring of the chain’s leadership team.

Jack in the Box National Franchisee Association said its no-confidence vote on Comma, who has been CEO and board chairman since January 2014, comes amid “unsustainable loss in sales and transactions.”

In a statement released Tuesday, the association said “lack of communication or action from corporate leadership to correct the trending decline in transactions” has spanned the past several years.

The group represents 95 Jack in the Box franchise owners who operate about 2,000 of the brands more than 2,200 restaurants. It made other demands, including appointing a “dedicated Chief Marketing Officer with a clear strategic vision and plan of execution for the company.”

In September, CMO Iwona Alter officially exited the company. In a quarterly regulatory filing, Jack in the Box said the company "no longer needs her services." Alter, CMO for two years, had been with the company since 2005.

Jack in the Box has not announced a replacement.

The company has denied that it wasn’t communicating with the group.

In a statement, the company said it has worked closely with the franchisee association “for the past several years, and during the past year in particular.”

“We have always been open to their constructive feedback and have worked to address any legitimate concerns,” the company said. “Importantly, we believe the viewpoints expressed today by the NFA leadership are not reflective of the entire franchise community.”

Jack in the Box said it will continue to work with franchisees “to develop and refine our strategy for success, and ensure our ultimate goals are fully aligned.”

“We remain focused on also balancing the interests of all our stakeholders, including our franchisees, customers, employees, and shareholders,” the company said.

For the third quarter, systemwide same-store sales at the San Diego-based company edged up 0.5 percent, the company reported in August. In the prior two quarters of 2018, comps decreased 0.1 percent and 0.2 percent.

The positive third-quarter same-store sales were driven by higher check averages tied to limited-time offers. Comma said this summer that the brand would spend up to $45 million over the next three years to enhance its drive-thru lanes by adding digital menu boards and tablet-holding order-takers like the ones at In-N-Out Burger and Chick-fil-A.

The association believes more can be done under a new leader.

“We are in need of leadership that is going to provide a robust strategy and vision to allow for the long-term, viable success of this major brand,” board member David Beshay said in a statement. “We can no longer sit idly by while the existing management team destroys the value of this brand for the franchisees, for employees and for shareholders.”

Contact Nancy Luna at [email protected]

Follow her on Twitter: @FastFoodMaven

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