Coping with Covid with Dustin King

Dustin King is a 33-year-old, third-generation operator steering his family’s snack empire through the Covid-19 crisis. He grew up in the business and has worked in it full-time since graduating college in 2009. Today the family’s snack food empire includes Auntie Anne’s, Häagen-Dazs, Cinnabon, Planet Smoothie, Jamba, Nestle Toll House Cookies, and Carvel. All told, the company operates just shy of 60 locations and is still intent on growth… soon as the malls reopen!

How has Covid-19 affected your business?

In the 2 to 3 weeks leading up to the governor’s shelter in place order, we were down about 50% to 60%. It began at about a 20% decrease and continued to drop from there. We opened up about half our stores on May 9. They reopened at less than 50% of comp sales, but have seen improvements every week. 

What are you doing right now to get through this?

We are applying for all the government assistance we can and working with our vendors to negotiate extended terms and other payment options. We also started selling DIY pretzel kits for Auntie Anne’s, and that’s helped a bit. The DIY pretzel kit allows families to create their own Auntie Anne’s pretzels at home. We provide all the ingredients needed to make 10 pretzels. It’s a great family activity and gives our guests an opportunity to enjoy the product in their own homes.

Are your franchisors helping keep you afloat?

Our franchisors have worked to try to reduce monthly fees with partners like our POS provider, digital menu boards, and other vendors who have recurring monthly fees. We have seven different franchisors, and all are working hard to do everything they can to help. We also have reduced royalties and/or marketing fees. In addition, our franchisors are deferring royalties now that we have started to reopen. 

What are you doing to help your employees through this?

We have weekly group employee filings for three of the four states we’re in. We’re also doing the legwork to ensure our employees get all the benefits they are eligible to receive. Additionally, we hosted a one-week back-to-work work training and paid our employees for an entire week even though the training itself took just a few hours. It’s essential to make sure our staff is properly trained on the new CDC guidelines to return to work safely. 

What are you doing for your customers?

We are taking catering orders, but most of our malls are closed, and we closed all our locations on March 21. Sales were so low it was actually costing us more money to stay open. As we reopen, we are requiring our staff to wear masks and gloves at all times. We have also put up plexiglass shields at all POS stations to protect the guests and our staff. In addition, we are encouraging tap-in pay. 

How are you working with your suppliers?

We have great relationships with our suppliers. We’ve contacted them and they’ve offered discounts and extended terms to try to help us keep as much of our cash reserve in place to reopen our locations.

What are you doing about cash flow, PPP?

We have worked with our lenders to pay interest for a time, and we received PPP money. We’re also grateful for the changes that were passed. We needed a larger percentage to pay rent and are glad to see the extended time period as well. 

What else would you like to see from your franchisor or government?

I’d like to see the government work with the insurance companies and require them to cover Covid-19 under the business interruption policy. We pay a lot of money for insurance. There are many things covered under these policies and Covid-19 should not be an exception.

How are you planning to reopen and rebuild your business post–Covid-19?

We worked with our partner zignyl on a 2-week back-to-open syllabus to ensure our staff gets extra training, are aware of the new processes and procedures for sanitation and cleaning, and to make sure we are doing our best to help prevent the further spread of Covid-19. After the training, many of our employees let us know how much better they felt about coming back to work.