Happy Joe’s Pizza & Ice Cream is continuing its transformational journey under its newest CEO via exponential franchise growth and reorganization of two corporate entities that operate its company-owned locations. That included a Sept. 2 Chapter 11 reorganization filing that resulted in closing some older company-owned stores. Overall, the iconic brand, which is now in […]
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Happy Joe’s Pizza & Ice Cream is continuing its transformational journey under its newest CEO via exponential franchise growth and reorganization of two corporate entities that operate its company-owned locations. That included a Sept. 2 Chapter 11 reorganization filing that resulted in closing some older company-owned stores.
Overall, the iconic brand, which is now in its 50th year, continues to enjoy record expansion under CEO Tom Sacco, the company said. In the past 18 months, Happy Joe’s Pizza & Ice Cream said in a news release it has signed more franchise agreements and opened more new locations than it had during the previous decade.
It also has more international locations in the works in Egypt and elsewhere in the Middle East. Of six restaurants under development in Giza, Cairo – Egypt’s second-largest city, four could open as soon as Oct. 6, according to Happy Joe’s franchise location page.
Meanwhile, as the Bettendorf-based brand is celebrating global franchise growth, here at home Quad Citians have seen a handful of area stores being shuttered. The Happy Joe’s in Eldridge closed its doors on Monday, Aug. 29. The brand’s Maquoketa store also has closed as has Davenport’s Rockingham Road Happy Joe’s location. In addition, Happy Joe’s-owned Tony Sacco’s Coal Oven Kitchen, Eldridge, is no longer in operation.
Those moves came even as other Happy Joe’s franchises continue to thrive. A news release reported that takeout and delivery sales are greater than pre-pandemic levels. And “the vast majority of Happy Joe’s 50-plus locations are highly profitable.”
Franchises also have been remodeled or are in the process of upgrading to the brand’s modern new design, leading to higher guest satisfaction, the company said.
Pains also were taken, Mr. Sacco said in a lengthy April interview with the QCBJ, to ensure the redesigned restaurants still paid tribute to the brilliance of Lawrence Joseph “Happy Joe” Whitty, who died on Oct. 29, 2019. Happy Joe opened his first restaurant in the Village of East Davenport on Nov. 16, 1972. The story-telling redesign, which Mr. Sacco calls “Happy Joe’s 2.0,” was rolled out in the franchise’s home state of Iowa in 2022. It also is part of the design of the half dozen restaurants nearing completion in Cairo, Egypt.
With the new design, Mr. Sacco not only is paying homage to Mr. Whitty’s brilliance, he also is keeping a promise to honor it by spreading the Happy Joe’s “magic” he’s grown passionate about around the globe.
But when Mr. Sacco was recruited to become the company’s “chief happiness officer” officer in October 2020, he said, his mission was not just to modernize the half-century-old Midwestern brand, but to restructure, revitalize and refresh the proven business model for future success heading into its second 50-year run. And he brought to that task a lengthy and successful career as a “transformational agent” including at Ponderosa Steakhouse, Red Robin Gourmet Burgers, BJ’s Restaurant & Brewhouse and Ghirardelli Chocolate Shoppes, the news release said.
The next step in the Happy Joe’s transformational process under Mr. Sacco came on Friday, Sept. 2, when the CEO filed the plan of reorganization for two of its four corporate entities, which operate Happy Joe’s company restaurants and Tony Sacco’s company restaurants.
Each includes a small number of company-owned and operated stores – which aren’t associated with any franchise restaurants – a few of which have not been remodeled in nearly two decades. “The one-two-three punch of COVID-19, rising food and labor costs, and recessionary fears have been too much for these older stores to overcome with today’s economic challenges,” the company said in its release.
“When I arrived at Happy Joe’s, I figured out really quick where the problems were,” Mr. Sacco, who is no relation to Tony Sacco, said in the news release. “With COVID wreaking havoc on our industry, expensive sale-leasebacks of company-owned restaurants taking place just prior to my arrival, a significant increase in food costs exacerbated by supply chain issues, and an ever more difficult labor market, our challenges kept increasing exponentially.”
“While nobody wants to put a company through a restructuring, it was the right thing to do for the long-term health and continued growth of the iconic Happy Joe’s brand,” he added.
To help make that happen Mr. Sacco said he filed the reorganization plan for Happy Joe’s company restaurants and Tony Sacco’s company restaurants. Both operate company-owned restaurants only and are not associated with any franchisee restaurants. The release stressed that means neither Happy Joe’s Franchising nor Tony Sacco’s Franchising are part of the filing.
“We simply should not continue to deplete our strong flow of franchise revenue to cover losses from a couple of underperforming company restaurants. The company stores need to stand on their own,” Mr. Sacco said. “The good news is that we are reinvigorating the Happy Joe’s brand, remodeling older restaurants, opening highly successful new franchise locations and entering new markets in Florida, Texas and Arizona – along with our international expansion into Egypt and throughout the Middle East. All of this is contributing to a stronger and healthier business model that will be significantly more profitable going forward.”
Happy Joe’s has been named a QSR Magazine “Top 50 Contender” in 2021 and 2022, a FastCasual “Top 200” concept, a Franchise Times “Top 400” business and a Nation’s Restaurant News “Top 500” restaurant.
