Quiznos CEO Deno Resigns as Schaden Steps Back In
DENVER (Blue MauMau) – Quiznos Subs announced today that Dave Deno has resigned effective immediately from his position as CEO and Rick Schaden, the franchisor’s largest shareholder, is taking over the reins again as the chief executive. According to sources, Greg Brenneman made the announcement early this morning to franchisees and employees through a special voicemail message. He explained that Deno was leaving due to personal reasons, that his commute between Louisville and Quiznos’ Denver corporate offices became too difficult given the commitment required. Brenneman said that he would be staying on as the company’s executive chairman.
A press release issued later said that the involvement of Greg Brenneman and Rick Schaden in these roles signals the personal commitment of Quiznos’ three large shareholders. It further stated,
“Rick’s amazing entrepreneurial skills were perfect for building Quiznos from the ground up and are ideal to grow the company in this tough economic environment,” said Greg Brenneman, Executive Chairman. “Rick was a franchise owner before buying and growing Quiznos. He has a detailed understanding of the brand. The marriage of Rick’s passion for the brand and new products, along with the world class management team we have brought in over the past two years, will enable us to maximize franchise owner profitability going forward. The Board would also like to thank Dave Deno for his service to the brand, both as a Board member and as CEO.”
Rick Schaden issed this statement:
“Quiznos is a great brand that has just begun to harvest its incredible growth potential in both US and international markets,” said Rick Schaden, Founder and CEO. “It is important that the investors directly spend their time and efforts with the company during these challenging economic times. Greg and I enjoy working together and will continue to do so in his role as Chairman of CCMP Capital Advisors and Executive Chairman of Quiznos.
“I am excited about working closely with franchise owners to improve restaurant operations. I also look forward to spending time with the outstanding Quiznos management team developing new products. Moving forward, our strategy will be exactly as it is today. Our primary focus will be on increasing restaurant profitability for our franchise owners by bringing value and convenience to consumers so that they frequent Quiznos more often.”
Schaden to Take on Numerous Challenges
The Quiznos system has been riddled with problems and litigation over the past seven years. According to some lawsuits, franchisees allege that the company has been engaged in illegal and deceptive business practices, inducing unwitting prospects to purchase and operate Quiznos stores. The documents state that with 4,636 franchises in the U.S. today, a number that is continuing to grow, Quiznos classifies the majority of its franchisees as financially distressed.
Last month it was reported in the Rocky Mountain News that the acceleration of the worst economic crisis in a generation had caused Quiznos to implement new strategies in advertising and pricing. Brenneman and Deno both stated they were working to mend relations with their franchisees and things were getting better every day. But some franchisees felt that lower prices were only further squeezing franchisees’ profits, and that Quiznos was struggling with its brand identity moving from one strategy to another.
Quiznos announced today another marketing plan. It will give away one million subs as part of its effort to offer better prices for a better world. Building off Quiznos' new lower price offerings, the million sub giveaway also rewards individuals who are doing their part to make the world a little better and encourages others to do the same. But franchisees feel it will not do anything to help them because the financial burden will be on them, not Quiznos.
Telephone calls to Quiznos and its media relations firm were not returned prior to publishing.
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