Editors note: All week, Restaurant Business will run profiles of the five nominees for Restaurant Leader of the Year.
Monday: White Castle CEO Lisa Ingram
Tuesday: Cheesecake Factory CEO David Overton
Wednesday: Brinker International CEO Wyman Roberts
Today: Jersey Mike’s CEO Peter Cancro
Peter Cancro, who bought what has since become the thriving Jersey Mike’s Subs chain when he was just 17, has found himself in a bit of a pickle due to the brand’s recent success.
Some of his 550 franchisees would like to own more Jersey Mike’s locations. But they’re geographically maxxed out in certain areas. Cancro, whose solid steering of Jersey Mike’s amid the pandemic’s ups and downs has earned him a Restaurant Leader of the Year nomination, has a solution:
He said he’s going to find more restaurants for those franchisees to operate—but they’re not going to be Jersey Mike’s.
“We are looking at another concept or two to bring in for the owners to open,” Cancro revealed, declining to provide further details other than that he would like to acquire a small, emerging chain rather than starting a new concept. “We’re not going to lose focus. But if we prove out the business model and get the best-of-class of another concept, we’ll start growing nationwide with that.”
Throughout his 51-year tenure with Jersey Mike’s, Cancro has proven time and again that doing well by franchisees makes smart business sense for his brand.
And it’s not just franchisees, of course. Even when Cancro was still a teenager, he made sure to thank vendors for coming in, said Mike Manzo, Jersey Mike’s COO, who has worked with Cancro for more than 40 years.
“If you didn’t come in, I don’t have the business,” Manzo recalled him saying. “He was always pulling people along, and not pushing them, and having a great attitude … It’s something he did in 1975 when he was a kid and now, he’s still doing it. It’s the longevity of him being just a good person.”
Turns out, being nice isn’t bad for business.
Average unit volumes at Jersey Mike’s have surged from $850,000 pre-pandemic to $1.2 million today. The 2,100-unit quick-service chain opened 252 stores last year and plans to open 300 this year. Cancro expects to be at 3,000 locations in under three years.
In 2019, the company made $1.3 billion. Today, systemwide revenue is $2.3 billion.
And Cancro’s favorite metric is also on the rise. Jersey Mike’s stores track their business in loaves of bread used each day.
“We’ve gone from 130 loaves of bread to 167 loaves of bread on average,” he said. “That’s how we compute. How many ‘bread’ are you selling? And now our goal is to get to 200 bread a day.”
Cancro’s Jersey Mike’s origin story is well-chronicled.
The chain was called Mike’s Subs in 1971 when a 14-year-old Cancro started working there. When he was a senior in high school, he heard that the Point Pleasant, N.J., shop was for sale. The enterprising teenager talked to his football coach, who also happened to be a banker, and secured a $125,000 loan from him.
In 1987, Cancro changed the chain’s name to Jersey Mike’s and started franchising.
“When you build a franchise like this, our principles are pretty basic,” Manzo said. “Do unto others. Treat them with respect … As he worked with the people and started growing, he’d say, ‘Work with the people. Don’t walk in with a clipboard.’”
All these years later, Cancro still travels to the restaurants to meet one-on-one with franchisees and work out any issues.
“I don’t know if we’ve had conflicts, even though I’m a very good friend of his and have been here for close to 40 years,” Manzo said. “He’s still the boss. He’s not confrontational. He would meet with each franchisee individually and make a decision. He doesn’t go to a store to cut a ribbon and shake hands.”
Working hand-in-hand with franchisees has long been a Jersey Mike’s hallmark.
One of the most tangible ways in which Cancro helped Jersey Mike’s franchisees was the $175 million remodeling program the company paid for in 2020 —$75,000 per store.
New floors, counters, tile and more, all paid for by the home office, a move that caused some franchisee to be “so emotional, they were in tears” when they found out, Cancro said. Among the biggest upgrades was the addition of a makeline dedicated to digital orders, which have climbed from 15% of sales pre-pandemic to about 40% today.
Beyond making franchisees happy, though, the retrofit program lifted sales. During the summer of 2020, Jersey Mike’s tracked a 30% boost in sales at Los Angeles units that had been remodeled. Stores that hadn’t been updated were up 15%, Cancro said.
“For us, it was an important tactical move that paid tremendous dividends,” he said. “It always comes back, whatever you invest in your stores. People see it.”
Currently, about 85% of the sandwich chain’s growth is coming from existing franchisees. In recent years, the chain has begun rewarding outstanding store-level managers and assistant managers with financial aid to open their own units under the Coach Rod Smith Ownership Program, named for Cancro’s life-changing football coach.
“That’s how you get a quality person opening,” Cancro said. “They know what the business is about. They know the culture. They’re going to be leaders and pull people along, not push. If you’re going to grow, grow from within.”
Adding to the chain’s success is its hands-on approach to real estate. The corporate office is involved in all site selection details, he said.
“We see every site,” he said. “We’re involved in construction. We do so much as a franchise company that most don’t. Before we sign a lease, we know about the grease trap, we know about the HVAC, we know what it’s going to cost. We’ve got a pretty good success rate with that.”
On March 26, 2020, in the pandemic’s earliest days, Cancro added the title of “TV star” to his resume. He not only appeared in his very first Jersey Mike’s national TV ad, but he wrote and directed it, too.
“It was a call to action, no product announcement,” he said. “’We’re in this together’ really came from the heart.”
Jersey Mike’s has long had a focus on charitable giving, one that has intensified in recent years.
Last March, Jersey Mike’s Month of Giving raised $16 million for charities nationwide. The chain has raised millions for children through the United States Tennis Foundation and has provided tens of millions of meals through Feeding America.
Cancro will continue to appear in occasional TV ads, he said, largely to promote the chain’s charitable efforts.
“You’ll see little tidbits of Peter,” he said.
The earnest commercials struck a chord with consumers, especially those who were watching lots of TV while cooped up at home in 2020.
“The brand has resonated out there with all the marketing we’ve done,” Cancro said. “The data says we’re more well-known than ever before. We open a little store outside Rochester, N.Y., and they say, ‘We’ve seen your commercials.’”
Leading Jersey Mike’s has been the only job Cancro has ever known.
But he said he cannot imagine doing anything else.
On a recent trip out West, he visited restaurants and met with the new area director there. The young leader said, just as Cancro had so many years before, that he was going to stand side-by-side with franchisees and work with them.
“To see the youth and the young people coming up,” he said. “Not going in with a clipboard but to teach and train and spread that culture as a company. That’s what gets me excited.”
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