Restaurant exec on coronavirus disruption: It was 'severe' & 'overnight'

Blaze Pizza CEO Mandy Shaw joins Yahoo Finance’s Seana Smith to discuss how the fast-casual chain is shifting its business strategy amid the coronavirus pandemic.

Video Transcript

SEANA SMITH: The coronavirus pandemic is having a devastating impact on the restaurant industry. Black Box Intelligence Data, which tracks out what we're seeing in the hospitality sector, showing that same store sales and restaurants declined more than 65% in the last two weeks of March.

So joining us now to talk more about this, we have Mandy Shaw, CEO of Blaze Pizza. And Mandy, thanks for taking the time this afternoon. Blaze Pizza, you have a number of locations across the US. You have more than 340 locations across the US, Canada, and the Middle East. I know you're a franchise organization, but to what extent is the coronavirus disrupting your business at this point?

MANDY SHAW: It's severe, and it was overnight, right? Like many restaurants, we had a dine-in and delivery and carry out business. But when dining rooms were mandated to be closed down, we had to pivot almost overnight and change the regulations on an ongoing basis.

So we still have folks that are allowed to come in the restaurant and go down the line to get their pizzas, but they can't sit and eat. So we had to innovate a lot of new curbside carryout and different ways for people to get their pizzas, phone ordering, which was actually on the decline as an industry, right, but is back now because not everybody is comfortable with apps and website functionality and those sorts of things.

SEANA SMITH: You're saying that you're still offering delivery. We've been talking about how a number of companies are staying open, but of course, there is the concern out there just in terms of keeping employees safe and what needs to be done in this type of environment. What is Blaze Pizza doing, just in order to ensure your workers out there, that they will be kept safe and they don't have a reason to worry by showing up to work every day?

MANDY SHAW: Absolutely. It's a great question. Because the restaurant business is all about people, actually, so making sure that they're safe is paramount to us and our guests as well. We have door signage that actually also tells you if you've been sick in the last 24 hours, not to enter the premises. And that's part of a staff protection measure.

We started shipping out masks to all the restaurants, and especially there are areas that are starting to mandate it now. Staff in the restaurants, we had an optional policy where, if they wanted to choose to wear them, they could. But we have a vendor of ours actually making craft masks for us in the restaurants.

We have handwashing on a rotational basis, where people are asked to wash their hands. We wipe down any of the high touch surfaces, door handles, or anything like that every 15 minutes with peroxide-based or other cleansers that actually kill the virus.

SEANA SMITH: I know that-- I was reading some of your business plans, of course, ahead of the coronavirus outbreak, and one thing that caught my attention was that you were rapidly expanding the number of stores that you have, the number of stores open. Has the pandemic changed at all your expansion plans, or really, any part of your business model at this point?

MANDY SHAW: Surprisingly, no. We all know this is going to end. The shock of the restaurant business is you have to minimize capital expenditures now so that you can last through and then have the jobs ready for when everything comes back. Blaze is well positioned to be one of the brands that actually exceeds-- or succeeds really strongly.

Once the virus starts to tamp back down, we can open dining rooms back up and/or just the delivery business stays as a primary component of what we do. So we've got restaurants under construction right now that have not stopped building. We've got new franchisees who are still calling us and asking to get in. And the stuff that was in the pipeline is still well on its way.

SEANA SMITH: And Mandy, I want to talk about what Blaze Pizza is doing in this time. You participated in the Great American Takeout. It's gotten tremendous amount of buzz over the last several weeks. Tell us about this and just what it's doing to help small businesses, to help restaurants during this very uncertain time.

MANDY SHAW: Yeah, sure. It's restaurants are a community. Like I said, it's people, it's fun, it's family, it's friendly, and we all care about each other. So it's a coalition of 400 plus restaurant chains and brands that have said, we want you, the American consumer, to eat out at least one more time a week, and it's every Tuesday. And we've seen significant sales.

And it's not about sales to the restaurants. It's about keeping people employed and making sure that that money stays in the system, like I said, so as the virus passes, we'll be able to succeed and open those jobs back up for people.

The other thing the Great American Takeout is doing is raising money for people. And just like the restaurant relief funds that are out there saving money for employees so that the ones that need assistance can get grants and assistance for their families and family meals and those things.

SEANA SMITH: Mandy, real quick, just in terms of you being a leader right now of Blaze Pizza, other restaurant industry, coronavirus is having such a devastating impact on the restaurant industry as a whole. What's the message that you want to send out to your employees or to some of your colleagues, some other restaurant owners or corporations, at this time just in terms of what you can expect going forward here, at least in the short term?

MANDY SHAW: Yeah, I think it's being innovative, and again, if you keep people first. One of the Blaze core values is valuing the people behind the pizza. If we're trying to find ways that we give a pizza to some of the employees that come in, right, or we're donating to hospitals. And that kind of support across the system is really important.

I think the idea is mutual support of the industry. This is still one of the last places where a person without additional education or any advanced training can get a job, work their way up to, say, a general manager position where they're making $80,000 to $100,000 a year. It's entrepreneurial access for people that want to start their own businesses. So it's vitally important that we work together to make sure that restaurants come through this and come through this strong.

SEANA SMITH: All right. Mandy Shaw, Blaze Pizza CEO, thanks so much for joining me this afternoon.