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Sunday, Aug 14, 2022

CPK Preps for the Future at OC HQ

Restaurants: New locations, menu items in the works

The design of California Pizza Kitchen’s new Costa Mesa headquarters incorporates much of the 35-year-old firm’s history in the state, but it’s the future that the restaurant chain has its eyes on.

“I think the move here sets CPK up for past my time,” CEO Jim Hyatt told the Business Journal during a tour of the office.

Hyatt, who took over the CEO role in 2018, decided to relocate the company from Los Angeles last year into the 37,875-square-foot space at The Met business campus in Costa Mesa after seeking a new office for the brand that counts more than 150 locations in the country, with 51 alone stretching from Santa Barbara to San Diego.

“I think it’s the better position within the state for the brand to reside,” Hyatt said.

Expect to see several growth initiatives coming out of the OC office, such as new restaurant designs, product lines and domestic franchising deals.

With 2021 revenue of almost $500 million, CPK is No. 35 on the Business Journal’s list of OC’s largest private companies (see list, page 32).

CPK in 2020 emerged from Chapter 11 bankruptcy, where it reduced its debt from around $400 million to $177 million.

“We made a lot of moves during that process that got CPK to a better position, low debt and even moving offices,” Hyatt told the Business Journal.


Blending Past and Present

The office space was designed with a goal of blending the company’s 35-year history with the CPK of today, according to Senior Vice President of Marketing Ashley Ceraolo.

The company’s logo—the diamond-shaped tile behind its name—is showcased across the walls, including in a 1994 sign that survived an earthquake in Northridge.

Other artwork includes the original CPK menu from its Beverly Hills opening and others from the past few decades.

Employees are also a focal point of the space—thousands of names line the office, from the entrance to the upstairs hallways.

On the right wall of the entrance hangs the company’s “Hall of Fame,” which features a handful of CPK executives who served on the team for many years and includes co-founders Larry Flax and Rick Rosenfield at the top of the piece, with Executive Chef Brian Sullivan’s tag hanging just on the other side.

There’s a separate recognition area for the 270 employees that stayed with the brand during the first year of the pandemic.

With an open-floor plan and personal cubicles, break rooms and several seating options, the space was structured with pandemic-era distancing and safety in mind.

“With all of us working remote and not seeing each other for a long period of time, we now have inspiration all around us to be motivated,” Ceraolo said.
The office also pays tribute to California, with a column made up of recycled skateboard material as well as wooden skateboards serving as signage for each location open worldwide, with additional room for anticipated openings.


California Dreamin’

The California inspired-décor is a good reminder to executives, who are aware of the challenges, and opportunities, that come with doing business in the state.

“It’s a tough state. You’ve got to have your eyes open and pay attention,” Hyatt said. “It will bring the best out of you, and it’s challenging but we love it.”

In 2019, CPK picked up demand for a product in between delivery and takeout. The company introduced the Take and Bake option, where customers can order a pre-made pizza and take it home to cook themselves.

The addition has been a success, prompting the restaurant to consider expanding the service to include other menu items like pasta.

“We look at everything we do and interrogate it, asking how can we do better,” Hyatt said.

On that front, CPK is reconsidering its restaurant design in the wake of the pandemic.

Its upcoming location in Laguna Niguel, opening in September, will introduce a dining style that “brings the outside inside,” according to Hyatt.

The company is adding more technology features, such as in-hand terminals for each server to create a faster dining experience, expected to roll out across all locations by 2023.

“It’s our job to balance those two things—incorporating technology but not changing the core of the CPK brand,” Hyatt said. “With California in the name, there’s definitely an expectation that we’re going to be a leadership brand and we strive to deliver that.”


Not Just Pizza

Menu innovation is led by Executive Chef Sullivan, who has been with the company since its second year in business.

The menu goes beyond its namesake dish including pastas and sandwiches, but the restaurant plans to take its options a step further.

CPK will soon introduce a California-based hamburger, The West Coast Burger, with plans to debut this fall.

“Restaurants need food that will carry the day and be the hero,” Hyatt said, who had the burger taste-tested by “the best in the business.”


Furthering the Kitchen

As of last month, CPK’s business is “dramatically outperforming” 2019 levels, even after losing 30% of its restaurants over the past two years because of mall closures. One notable local closure was a longtime location at the Fashion Island shopping center.

The chain debuted on the Business Journal’s list of OC-based Restaurant Chains at No. 8 last month, and next year’s ranking may be even higher as the company prepares to launch a new franchising strategy.

Before joining the company as CEO in 2018, Hyatt had helped take Knoxville, Tenn.-based Ruby Tuesday restaurant group from public to private, and spent the 33 years prior with Burger King, where he oversaw 22 restaurants in Atlanta.

That experience will come in handy—Hyatt is now preparing to expand its 156 U.S. restaurant count through franchising.

The domestic expansion strategy, first announced in November, isn’t a new one for CPK; the chain opened 40 franchise locations outside of the U.S. with its international franchise program, with deals in Chile and Costa Rica in the works.

The company will start with 30 to 35 initial U.S. franchisees, with a handful of operators already in the queue.

“Why not let franchisees bring the brand to the marketplace in places that we’re currently not?” Hyatt said.

Franchise operations is headed by Giorgio Minardi who has more than 35 years of experience as an international retail operating executive and joined CPK in 2019.

“It’s never had its true time in the sun,” Hyatt said of CPK. “We want to breakaway and let everybody else worry about following us.”


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