Schlotzsky’s in deal for 170 new restaurants in California
Austin, Texas — Schlotzsky’s has signed the brand’s largest franchise agreement in more than 40 years, entering into a partnership that calls for more than 170 Schlotzsky’s locations throughout California. The company, which currently has more than 350 locations worldwide, plans to have upwards of 700 locations by 2016.
Each of the new restaurants will feature a new, contemporary design and an upgraded service model in which crew members hand-deliver food to the tables.
"Between this agreement in California and multiple others we’ve signed in the past year alone, the momentum is incredible,” said Kelly Roddy, president of Schlotzsky’s. “On top of the obvious benefits the expansion is having on our brand, it’s also creating job growth in communities around the country," noting that the new locations in Southern California will create nearly 7,000 jobs in the next five years.
Schlotzsky’s is continuing its growth momentum by aggressively targeting markets in Texas and untapped markets around the country for multi-unit developers. These markets include: Atlanta, Charlotte, Denver, Kansas City, Miami, Nashville, Raleigh, St. Louis and Tampa, as well as other underdeveloped markets through the United States.
Kimco receives subpoena in Wal-Mart probe
New York — Shopping center operator Kimco Realty Corp. has received a subpoena in an investigation over possible violations of the Foreign Corrupt Practices Act (FCPA) by Wal-Mart Stores, Reuters reported.
In a filing with the Securities and Exchange Commission (SEC), the Kimco said it had received the subpoena on Jan. 28 from the SEC’s Enforcement Division. Kimco said it would fully cooperate with the SEC, and that the Department of Justice was conducting a "parallel investigation" with the SEC, according to the report.
The FCPA is a law that bars U.S. companies and others from paying bribes to officials of foreign governments in exchange for business.
U.S. authorities have stepped up enforcement of the FCPA in recent years, Reuters said.
Barnes & Noble swings to Q4 loss on sharp decline in Nook e-book sales
New York — Barnes & Noble reported on Thursday a loss in the fiscal third quarter, hurt by a 26% decline in revenue for its Nook e-book readers.
The company posted a loss of $6.1 million quarter through Jan. 26, compared to a profit of $52 million in the year-ago period. The retailer blamed the loss partially on charges stemming from weaker-than-expected sales of Nook e-readers during the holiday shopping season.
Revenue fell 9% to $2.22 billion. Analysts had predicted sales of $2.4 billion.
Revenue from the company’s retail unit dropped 10% to $1.51 billion. Same-store sales fell 7.3%. Excluding Nook sales, same-store sales edged down 2.2%.
Barnes & Noble released its results just days after company founder, chairman and largest shareholder, Leonard Riggio, announced plans to offer to buy the physical bookstores and website of Barnes & Noble, but not the Nook unit. On Thursday, the company said it has appointed board members to evaluate a proposal when it is made.
In response to the Nook sales shortfall over the holiday season, Barnes & Noble said Nook is calibrating its business model and has implemented a cost reduction program that the company projects will significantly reduce the related expenses.
“In terms of the Nook Media business, we’ve taken significant actions to begin to right size our cost structure in the Nook segment, while also taking a large markdown on Nook devices in order to enhance our ability to achieve our estimated sales plans in subsequent quarters,” stated William Lynch, CEO of Barnes & Noble. “Nook Media has been financing itself since October of 2012 due to the strong investment partners we’ve been able to attract in Microsoft and Pearson. Coming off the holiday shortfall, we’re in the process of making some adjustments to our strategy as we continue to pursue the exciting growth opportunities ahead for us in the consumer and digital education content markets.”