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Herman Cain bases his campaign for the presidency on his success as a manager and CEO of Godfather’s Pizza.
Herman Cain claims to have brought Godfather’s Pizza from the edge of bankruptcy to profitability during his time there.
He has never released any annual profit and loss statements to back this up.
The company reached all time high profits in 1983, was still profitable in 1984, and only apparently was not profitable in 1985 due to a lawsuit. That lawsuit was settled before Cain became manager in 1986.
It is a false statement that the company was on the edge of bankruptcy when he took over.
The only real objective evidence that is publicly available for how well he did is annual sales.
How much did sales increase or decrease during Cain’s time at Godfather’s Pizza?
Competition wise, Godfather’s dropped from fifth largest sales among Pizza chains to 11th during the time he was associated with the company.
Here is a year by year breakdown:
B.C. (Before Cain)
1983: $340 millionhttp://www.justplainpolitics.com/#_edn1
1984: $365 million[ii] (900 stores)
1985: $325 million[iii] (720 stores)
Pillsbury assigns Herman Cain to run Godfather’s Pizza in April 1986
1986: $275 million[iv] (640 stores)
1987: $260 million[v] (605 stores) (sales per store $414,000)[vi]
1988: $242.5 million[vii] (563 stores)
Pillsbury sells Godfather’s Pizza to Cain and management group in a leveraged buyout for $40 million.
1989: $225 million[viii] (509 stores)
1990: $229 million[ix] (512 stores)
1991: $231 million[x] (525 stores)
1992: $242 million
1993: $249.5 million
1994: $244 million[xi] (514 stores) (sales per store 490,000)
1995: $260 million (525 stores)
1996: $265.5 million (540 stores) (sales per store $500,000)
Cain becomes CEO of the National Restaurants Association in 1996, but was still on Godfather’s Management Board.
1997: $270.8 million[xii]
1998: $280 million
1999: $280 million
2000: $288 million[xiii]
2001: $280 million
2002: $287 million (560 stores) (sales per store 502,200)[xiv]
Cain steps down from Godfather’s Management Board
2003: $304 million[xv]
2004: $313 million[xvi]
Inflation from 1985 to 2001 was 64.5%.
In terms of 2002 dollars, the $325 million sales of 1985 would be the equivalent of $534 million at the beginning of 2002.
The final sales in Cain’s last year with Godfather’s Pizza, $287 million total, when we compare it with the year before Cain’s arrival, adjusted for inflation, shows that sales at Godfather’s Pizza dropped 46% during Cain’s association with Godfather’s Pizza.
We might see how Cain did in just the years where he was CEO.
Adjusting for inflation in 1985 to 1994, to compare it to the last year, 1995, that he was a full time CEO at Godfather’s, $325 million equals $448 million.
Thus the drop was from $448 million to $265.5 million. This is a drop of about 41%. Adjusted for inflation, sales dropped by about 41% in the ten years that Herman Cain ran the company as CEO. He had five years where sales decreased and five years where sales increased, but the years that sales increased barely kept up with inflation.
Godfather’s Pizza was bought for 300 million by Diversifoods Inc. in 1983. Pillsbury Inc. bought most of Diversifoods’ restaurants for about $390 million in 1985. Because Diversifoods sold over 300 Burger Kings and other restaurants to Pillsbury, it is hard to know how much Pillsbury actually paid for the 740 or so Godfather restaurants it bought.
It was probably $100-150 million.
Three years later, after Cain had been managing the restaurants for 2 1/2 years, they sold it to Cain and twenty other managers for $40 million dollars.
Cain was sent by Pillsbury to increase the company’s value. He failed miserably. If he had succeeded, Pillsbury would not have sold the company with huge losses.
The goal of a management buyout is generally to quickly return a company to profitability and sell it at a profit. Cain was unable to accomplish this in the next seven years that he ran the company.
Please ask reporters to question Herman Cain about why he doesn’t release his earnings statements from his Godfather Pizza years.
He is asking for our vote for president, but not being honest with us about how well he did managing Godfather’s Pizza.
http://jayraskin.wordpress.com/2011...izza-sales-figure-from-the-herman-cain-years/
Herman Cain claims to have brought Godfather’s Pizza from the edge of bankruptcy to profitability during his time there.
He has never released any annual profit and loss statements to back this up.
The company reached all time high profits in 1983, was still profitable in 1984, and only apparently was not profitable in 1985 due to a lawsuit. That lawsuit was settled before Cain became manager in 1986.
It is a false statement that the company was on the edge of bankruptcy when he took over.
The only real objective evidence that is publicly available for how well he did is annual sales.
How much did sales increase or decrease during Cain’s time at Godfather’s Pizza?
Competition wise, Godfather’s dropped from fifth largest sales among Pizza chains to 11th during the time he was associated with the company.
Here is a year by year breakdown:
B.C. (Before Cain)
1983: $340 millionhttp://www.justplainpolitics.com/#_edn1
1984: $365 million[ii] (900 stores)
1985: $325 million[iii] (720 stores)
Pillsbury assigns Herman Cain to run Godfather’s Pizza in April 1986
1986: $275 million[iv] (640 stores)
1987: $260 million[v] (605 stores) (sales per store $414,000)[vi]
1988: $242.5 million[vii] (563 stores)
Pillsbury sells Godfather’s Pizza to Cain and management group in a leveraged buyout for $40 million.
1989: $225 million[viii] (509 stores)
1990: $229 million[ix] (512 stores)
1991: $231 million[x] (525 stores)
1992: $242 million
1993: $249.5 million
1994: $244 million[xi] (514 stores) (sales per store 490,000)
1995: $260 million (525 stores)
1996: $265.5 million (540 stores) (sales per store $500,000)
Cain becomes CEO of the National Restaurants Association in 1996, but was still on Godfather’s Management Board.
1997: $270.8 million[xii]
1998: $280 million
1999: $280 million
2000: $288 million[xiii]
2001: $280 million
2002: $287 million (560 stores) (sales per store 502,200)[xiv]
Cain steps down from Godfather’s Management Board
2003: $304 million[xv]
2004: $313 million[xvi]
Inflation from 1985 to 2001 was 64.5%.
In terms of 2002 dollars, the $325 million sales of 1985 would be the equivalent of $534 million at the beginning of 2002.
The final sales in Cain’s last year with Godfather’s Pizza, $287 million total, when we compare it with the year before Cain’s arrival, adjusted for inflation, shows that sales at Godfather’s Pizza dropped 46% during Cain’s association with Godfather’s Pizza.
We might see how Cain did in just the years where he was CEO.
Adjusting for inflation in 1985 to 1994, to compare it to the last year, 1995, that he was a full time CEO at Godfather’s, $325 million equals $448 million.
Thus the drop was from $448 million to $265.5 million. This is a drop of about 41%. Adjusted for inflation, sales dropped by about 41% in the ten years that Herman Cain ran the company as CEO. He had five years where sales decreased and five years where sales increased, but the years that sales increased barely kept up with inflation.
Godfather’s Pizza was bought for 300 million by Diversifoods Inc. in 1983. Pillsbury Inc. bought most of Diversifoods’ restaurants for about $390 million in 1985. Because Diversifoods sold over 300 Burger Kings and other restaurants to Pillsbury, it is hard to know how much Pillsbury actually paid for the 740 or so Godfather restaurants it bought.
It was probably $100-150 million.
Three years later, after Cain had been managing the restaurants for 2 1/2 years, they sold it to Cain and twenty other managers for $40 million dollars.
Cain was sent by Pillsbury to increase the company’s value. He failed miserably. If he had succeeded, Pillsbury would not have sold the company with huge losses.
The goal of a management buyout is generally to quickly return a company to profitability and sell it at a profit. Cain was unable to accomplish this in the next seven years that he ran the company.
Please ask reporters to question Herman Cain about why he doesn’t release his earnings statements from his Godfather Pizza years.
He is asking for our vote for president, but not being honest with us about how well he did managing Godfather’s Pizza.
http://jayraskin.wordpress.com/2011...izza-sales-figure-from-the-herman-cain-years/