I’ve been working in the restaurant industry for more than 20 years. I started with KFC in a finance capacity in 1991 after spending five years in the consulting world. I wanted to move into something challenging and fast-paced, and at KFC I developed a really good sense for all the financial aspects of the restaurant business. And then in 2003, I had an opportunity to get with Yum! Brands, which had a centralized development function supporting five brands: Taco Bell, Pizza Hut, KFC, Long John Silver’s, and A&W.
Jay McDermott: Career Highlights
1984: Graduates cum laude with a BA in political science from Yale University
1988: Completes the MBA program at Dartmouth College’s Amos Tuck School of Business Administration
1988–1991: Works as an associate at Personnel Corporation of America, a management consulting firm
1991: Begins working with KFC in a finance capacity
2000: Climbs all the way to the director of franchise finance position at KFC
2003: Begins working for Yum! Brands as its senior director of development strategy
2005: Rejoins KFC as its vice president of development
2010: Moves to a position as vice president of development for DineEquity’s Applebee’s brand
2012: Takes over as vice president of development for all of DineEquity
I had a kind of baptism by fire coming into the development world. It was a great experience for me. I had accountability for development strategy, market planning, IT support, and we were building 350 restaurants a year. I was able to learn how property management and lease administration worked, how you pick the best sites for real estate, how you plan construction timetables, and what things you need to think about to succeed in different geographies.
Yum! later made the decision to decentralize the development function, so I moved back to KFC and created a brand-specific development function. But soon the economy was proving to be a challenge for the brand. It didn’t look like that was going to change, and relations with franchisees were strained. It was a challenging environment to be a development professional in, so I moved over to Applebee’s in 2010. The brand has 1,850 restaurants domestically, and the company was in the process of testing a new remodel program. That was exciting for me.
Applebee’s is a 30-year-old brand, and the average age of an asset is 10–15 years. We recognized that to signal change to our guests, we had to do something to the exterior and interior of the restaurants. We defined three minimum exterior [adjustments] for the franchisees to accomplish: update to new signage reflecting a more contemporary typeface, replace the old awnings with new elongated and illuminated awnings, and enhance the front entryway to really create a sense of arrival, warmth, and invitation.
We took all the artifacts off the walls inside the restaurants. The old tube TVs were replaced with flat screens. We brought in a new light package replacing the old Tiffany lamps with sleeker, more colorful lights. We also included a number of wall murals custom made for each location. We provided enough opportunity for the franchisees to personalize the content of the décor so that folks would know, “This is our neighborhood.”
We have about 40 franchisees, so mobilizing everyone to work together gives us a unique competitive advantage. Our franchise owners are entrepreneurs, and they really understand the value of becoming a part of their community. It’s been really enjoyable for me to continue to succeed with Applebee’s, even when the market is uncertain. Now that we’ve combined our development functions, the development team is supporting both the Applebee’s and IHOP brands. We’re kicking off a remodel program with IHOP, so the challenge will be to replicate the success that we’ve had with Applebee’s [while] also understanding what it’s going to take to succeed in the IHOP world. ABQ