Chris Collins: Yes. I mean our current development targets sell and incorporate a significant amount of new geographies opening up over the next two years. It’s really based on our current franchisees and the current agreement that we have in place. I mean Asia is a huge growth region for us right now. China is probably going to be our biggest unit development growth country for the foreseeable future. We are anticipating new units coming in from India in the back half of this year, or I’m sorry, starting in 2024. So we’ll have two years of India development. And 650 units over a 10 year period, obviously, there’ll be a bit of a ramp there. But that’s a lot of units in 2024 and 2025 relative for the development that’s going on elsewhere.
So, we do believe that we can ramp pretty quickly. We’re seeing – especially internationally, we’re seeing continued strength in a lot of our Middle Eastern and in Asia markets. Obviously, I think we called out, we’re in the UK where there’s some franchise optimization going on there, system optimization, making sure that we are set up for long-term growth. So that’s been a bit of a development source for us over the last four or five years that is evolving right now, but we feel confident that we can make up some of those challenges in some of these other markets.
Peter Saleh: Thank you.
Operator: Thank you. One moment for our next question. And it comes from the line of Dennis Geiger with UBS. please proceed.
Dennis Geiger: Thank you. Rob, in your prepared remarks, you talked about your industry leading CRM platform and then the size of the loyalty program at point. Just wondering if you could talk a little more about the opportunity there to better leverage that platform. And related to that, I’m curious as it relates to third-party, which I don’t know how much of that kind of integrates with loyalty or assume part of it is separate. Just curious within that — if that third party business, if you can speak to has become a larger – if the mix continues to go higher of your total business. And how you think about that within the context of that – of your kind of internal CRM loyalty platform? Thank you.
Rob Lynch: Sure. The aggregator business is not tied to our loyalty business. In fact, ideally, we would bring in new folks from the aggregators and convert them into loyalty members. I mean, the data that we have suggest is what the aggregator marketplace business is between 50% and 60% incremental new business for our business. So, that’s something that is really part of our strategy. We’re bringing in those new customers. They love our products. They love the innovation, the new ideas that we bring. And then, they want to come back, because it is more economical to order Papa John’s through our organic channel. So that’s kind of — that’s the long-term. That’s the that’s the business model. In terms of how much the aggregators represent of our business?
Yes. I mean, obviously, if our comps this year are flat and our business with the aggregators is growing, then they are going to continue to grow as a percent of our business. It’s still a very – it’s a healthy amount, but it’s not something that is becoming a situation where we’re dependent on that business for us to be able to deliver our long-term objectives. It’s a healthy growing piece of our business that we’ll continue to invest in. It’s profitable. But it’s not so substantial that we feel like it’s a liability And then the last the last question around our loyalty platform. I know, I’ve got like a broken record here, but we still have not fully capture the value of that program. We have not yet built out the capabilities to execute the level of one-to-one marketing and frequency building opportunities that I aspire for that program to achieve.
And I take accountability for that, but I also get excited about it, because it continues to be upside. And so, we just hired a new CMO, Mark Shambura, who is really passionate about that work. And I’m obviously passionate about it as well. And so, that will be a big focus for us moving forward. And over the last three years, the tools and capabilities to leverage that huge amount of data that we’re getting has changed significantly, just over the last three or four years. So we look to tap into that and leverage that to create a lot of value moving forward.
Dennis Geiger: Thanks for taking us, Rob. Appreciate it.
Rob Lynch: Got it.
Operator: Thank you. One moment for our next question. And it comes from the line of Andrew Strelzik with BMO Capital Markets. Please proceed.
Andrew Strelzik: Hey, good morning. I guess I wanted to just try to tie some comments that you made together and ask about your value proposition, which you said is strong versus the industry. You’ve talked about the ability to hold on to the price increases. But at the same time, we’re seeing some delivery shifts to carryout, which may be attributed kind of to cost and have talked about better check traffic balance. So, I guess, how do you think about getting there? I guess on one hand, it could just be as simple as not taking as much price this year. But are you planning to shift your kind of value messaging? Is there more that you think you need to do? You talked about the one-to-one marketing maybe that plays in. I’m just curious how you think about and reflect on the value efforts you’ve had so far and your value proposition going forward? Thanks.
Rob Lynch: It’s a great question. Because we’re definitely entering into a period if we’re not already all the way there where value is going to become more important it has been over the last three years. And so, it’s critical for us to have a compelling and successful value strategy. I mean, regardless of whether or not we are going to focus on our premium innovation. I mean, that’s what we’ve done over the last three years of kind of our positioning in the marketplace. If you don’t have a compelling value strategy, it’s really hard to compete QSR, whether you’re in pizza, burger, tacos, whatever. I mean, value is a big part of the business model. So, despite the fact that we focused on our premium innovation and that we’ve continued to drive a significant amount of check growth through trading customers up to products like Stuffed Crust and New York-Style and Chacaroni and all these other things.
We’ve never walked away from value. I mean, we still offer great carryout specials on our app and our website. We still offer great bundle on our app and our website. So, we haven’t necessarily taken the same approach as some of our competitors with big 50% off promotions and those types of things. That’s not necessarily a part of our strategy. The value is a big part of our strategy. And we get at it a lot of different ways. I mean, our Papa Pairings platform is a way for us to bring great value on wings and other side items. Our carryout specials are tapping into a lot of the drive ports carryout. So, we fully believe that we have to be competitive on value. We just get at it a little bit different than maybe some of the other competitors in the industry.
So, we’re going to continue to invest on premium innovation. We’re going to continue to push our most premium loyal customers into some of our new great products, but we know we have to meet the needs of that core customer and we’re focused on doing that.
Andrew Strelzik: Great. Thank you very much.
Rob Lynch: Thank you, Andrew.
Operator: One moment for our next question, please. And it comes from the line of Todd Brooks with the Benchmark Company. Please proceed.
Todd Brooks: Hey, good morning. Thanks. Quick question, taking the unit growth discussion to this year’s level, Rob. I know you guys have reaffirmed your targets for net new openings this year. I think you got about 10% of that level opened in Q1. Can you just talk to the opening pace early in the year relative to how you expected the year to track? And maybe just on the 24 international closures. Are those concentrate in the UK or are they more broadly spread? Thanks.
Rob Lynch: Yes. I mean, we’re actually right track with our forecast for the year in terms of net new openings and the closures that we have seen have been spread throughout our footprint are not concentrated in the U.S. We did a market transformation in the Netherlands, and I think that represented a big chunk of those closures. And we didn’t necessarily have that in our plan for the year, but we were able to actually open restaurants at a higher rate and other geographies to mitigate that. Net-net, it puts us right on track with where we had planned on being at this point in the year. As I did mention though, just for color, I mean, and I think we disclosed in some of the discussions. We are working on the UK. And there will be some market amortization there, and there’s probably going to be a little bit less development there as a outcome of that.
And so — but we have been able to fill that gap with upside in a lot of our other geographies and in a lot of our other markets. I mean, the reality is we have some really strong performance and sequentially continues to improve in Asia and Middle East. So, we’re doubling down on those markets, which is mitigating some of market optimization that we’re going to have to execute the UK.
Todd Brooks: Thanks Rob.
Rob Lynch: Thank you.
