Co-Founder & CEO, Inspire Brands (parent of Dunkin'), Dunkin' (Dunkin' Donuts)
Inspire Brands CEO Paul Brown sits down with Jim Cramer
Inspire Brands Co-Founder and CEO Paul Brown joins 'Mad Money' host Jim Cramer to talk the fast food sector, its offerings across several brands, digital integration with ordering and more.
Transcript (26 segments)
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Interviewer0:09
You need to keep up with the biggest privately held companies. Inspire Brands. The household name that owns a bunch of companies. They have more than 32,600 locations and 57 global markets. On top of that, there has been speculation they have been coming public later this year or 2025. Even if it stays private, we can learn from this phenomenal outfit, so let's check in with the cofounder and CEO of Inspire Brands to get a better read on the restaurant business. Welcome.
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Paul Brown0:54
Great to be here.
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Interviewer0:55
As a restaurant to work, you inspire me. In six years, and it all works, but how did you get the idea? How did you get these particular businesses? And tell us, come your number one and everything.
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Paul Brown1:08
Inspire Brands is a global restaurant platform. What makes us different is we are tightly integrated around a shared responsibility. It looks more like a model you might be familiar with in the hotel sector than the restaurant.
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Interviewer1:31
I will tell you something that is amazing. I always thought that Dunkin' was pretty good, but there were so many areas of the country that did not have it. What have you done with that chain since you took it over?
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Paul Brown1:47
Dunkin' is on fire. Up 30%. @jimcramer know how hard it is to do?
Part of it is we have replaced all the coffee equipment and beverage equipment and made some great investments to allow us to build up the iced coffee. A franchisee in Rhode Island got the bright idea of pouring coffee over ice and everybody liked it. So we went with it.
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Interviewer2:19
That's remarkable. There are some people don't realize. Drive-ins you pioneered.
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Paul Brown2:31
Sonic we felt that brand was perfectly set up for order ahead. Arby's has the ability to order ahead and bring the food out to you. Of course we didn't know COVID would come along and we exploded during that time. It has been a great business. Sales are up 24% year-over-year.
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Interviewer2:54
People may say wait a second. Almost 32,000 restaurants, you are tapped out, but you are putting out projections that indicate you are nowhere near tapped out on any of these brands.
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Paul Brown3:03
That is a great thing about having a portfolio. We have white space if you look at where we are. They are still fairly concentrated in this part of the country.
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Interviewer3:24
I find what you are doing is remarkable. Are you ever home?
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Paul Brown3:28
It's all about building the relationships with great licensees. In bringing one of our brands to a licensee that may have had another brand, it has helped us build up.
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Interviewer3:37
Has some great synergy. One thing I have been most impressed with is you have the Buffalo Wild Wings including one in Philadelphia where I think we could use an additional period. How is that going to work? The takeout?
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Paul Brown3:54
We have over a million dollar takeout business in all of our restaurants. 800 square feet to 1100 square feet. We just see a huge amount of growth in that. We will have 160 open by the end of the year, our third one opening in Manhattan in a few weeks, and in April you will have one in Philadelphia. We have 500 commitments plus from franchisees to build more over 18 months.
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Interviewer4:29
That is incredible. I am not going to mention Sonic, but I will mention that when I was doing not as well as I am now, RVs was my go-to.
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Paul Brown4:51
We think there are more opportunities for people to try the food. We have something coming later this year that will give people an opportunity to really try Arby's in a way they haven't, and I know they will love it.
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Interviewer5:07
Okay, I can't leave JJ out. But Baskin-Robbins, 7,700 of those. These are incredible numbers that you are putting out. There really is more room for ice cream? More room for sandwiches?
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Paul Brown5:23
Absolutely. Baskin-Robbins, two thirds outside the United States. We have almost 1,000 in India.
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Interviewer5:31
You said something that was riveting. He said we don't want to be in China so much, we want to be in a growth market. India. You are not hostage to the thinking that it is just enthralled so many Americans for so long. That's not working.
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Paul Brown5:50
You have to go to China the right way. We have no exposure in China, but we love India and so many of the other markets. Latin America. So many growth opportunities.
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Interviewer5:57
You can look at it in two different ways. What are you thinking?
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Paul Brown6:02
We see about 75% of Americans every year. Of our last quarter given the breadth of our brand, we do see that we have been pleasantly surprised and their differences based upon income level, but that is a beautiful thing about having a broad diverse brand with multiple price points.
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Interviewer6:21
These weight loss drugs, I mean they are just a factor, right? People are going to eat what they want.
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Paul Brown6:28
We haven't seen any impact. We have just focused on having great food at a great price.
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Interviewer6:33
I have to congratulate you. I am incredibly impressed. Sir, thank you so much. Paul Brown, cofounder and CEO of Inspire Brands. If you ever want to be an entrepreneur and really own something, this may be a great place to get started. Certainly we will be right back.