35 years ago, Jimmy John Liautaud opened the very first Jimmy John’s sandwich store. Since then, the company has grown into a $2 billion business with 2,800 locations. As a result of this growth, the company managed to outgrow the founder. In 2016, Roark Capital bought the majority of the company, leaving Liautaud with 35 percent of the company. Instead of being in charge of everything, he is now in charge of food and culture. However, Liautaud is taking the change in stride.
Liautaud is used to unrest in his life. As a child, his family constantly struggled with money. His mother was an elementary teacher in Illinois, while his father was an Army veteran turned entrepreneur. Unfortunately, his father’s attempts at success lead to him having to file for bankruptcy twice. Luckily for Liautaud, his father finally found success by the time he graduated school with his plastics-molding firm. As a result, James Liautaud decided to give Jimmy John Liautaud $25,000 to start a business with one condition added to it. If the business didn’t take off within one year, he would have to join the army. In 1983, he used this money to open up the first Jimmy John’s sandwich shop near Eastern Illinois University.
The location proved to be a great choice for the business. Liautaud targeted college students as his main customer base, even delivering sandwiches to their dorms for a small fee of 25 cents per sandwich. To this day, delivery is an important part of Jimmy John’s business. In his first year of business, Liautaud made $40,000, which he split with his father. In his second year of business, he made even more money, allowing him to buy out his father and becoming the sole owner of the company. By 1986, his store had grown so much that he was able to expand and open a second store. By the time 1994 rolled around, he had opened 10 stores and was raking in $1 million in gross profit.
Part of the success of the business can be contributed to the simplicity of the menu. To this day, the menu only contains six meats, three breads, and provolone cheese. This business tactic has allowed the company to keep food costs down, which allows them to make more money. In addition, Liautaud standardized a number of things to maintain consistency throughout all of his restaurants. He even standardized the layout of the restaurants, which included everything from walk-in refrigerator size to the placement of the sinks.
In 2007, Liautaud began selling off pieces of his company, selling 28 percent of the business to Weston Presidio. With the money he made from the sale, he paid $25,000 to each of his first three employees. The rest of the money was poured into both farmland and municipal bonds.
For another six years, the company continued to grow. However, it eventually got to the point that controlling the business became too much for Liautaud. To help with some of the workload, Liautaud named James North, a longtime employee, the first CEO in 2014. Around the same time, Weston Presidio was attempting to get rid of its Jimmy John’s stake. This combination of events led to Roark Capital buying the majority of the business in 2016. This purchase added Jimmy John’s to their already large number of assets, which includes Arby’s, Buffalo Wild Wings, Hardee’s, and many more. Now, the future of Jimmy John’s Sandwich Shop is now in the hands of Roark Capital.
