Customers are fed up with how much it costs to dine out. With more Americans cooking at home to bring down their food budget, restaurant chains are suddenly offering a return to value menus.
Gregg Majewski, founder of Craveworthy Brands and former CEO of Jimmy John’s, believes it never had to be this way — and that many brands eroded loyalty by overextending their post-pandemic inflationary grace period. Majewski told b. how businesses can create real value and rebuild lost trust.
b.: You had a successful corporate career at Jimmy John’s before starting Craveworthy. What drove this entrepreneurial shift?
Majewski: My entire life has been entrepreneurial. Even at Jimmy John’s, it was an entrepreneurial position, even though I was working for somebody else … because I gave my blood, sweat, and tears to it. …
… Jimmy was an incredible man and leader — I owe him everything I could possibly do in this industry. … There was nothing that I didn’t believe we could accomplish. We wanted to be the No. 2 sandwich concept. We got there.
b.: How have you balanced the need for profitability with the demand for affordability?
Majewski: I think restaurants are stupid in the fact that every opportunity we get, we jack our prices up because our costs went up. What the grocery store does very well — and [why they’re] our biggest competitor right now — is when the cost of milk and eggs … fell back down, the consumer saw a price decrease. The cost of eggs did not stay at that new normal.
We, as restaurants, kept our prices at that new normal from what the height was, and we alienated the customer base. Two years ago, I was concerned that customers might push back too much, so I created … value propositions [like a $7.99 chicken thigh sandwich], but they were new items and we don’t call them “value.” … You don’t want to discount your brand. Once you start discounting, you’re telling your consumer that your product is really only worth the lower price. That’s what happened to pizza. You never order a pizza without a coupon. Well, that’s because the real price is B.S.
b.: How do you think more business owners can adopt that forward-thinking approach?
The biggest fault of every businessperson is you’re so in the weeds, worried about today and tomorrow. What will take your company to the next point is thinking years down the line, because you’re giving yourself something to work toward. …
… My greatest goal is to make my team millionaires. … If my team knows I want to change their lives, they’re a lot more willing to work 60 to 65 hours during tough times. … I’ve seen too many people not give back to those who have taken care of them, and companies never get to the next level because of it.
Read our full Q&A with Gregg Majewski at business.com