Hoping to draw new financial strength from its roots, Godfather's Pizza, which only a year ago transferred its corporate headquarters and a third of its top staff to Costa Mesa, will move its executives back to Omaha, Neb., the company said Monday.
In an interview with The Times in January, a Godfather's spokesman had said the company had no plans to pull its headquarters out of Costa Mesa, where it employs about 30 people.
That was one president ago, however. Godfather's present leader--the fourth in 18 months--has decided to return to Omaha, where the company was founded in 1973--to be closer to most of the restaurant chain's franchise holders, according to company spokesman Ken Pieper.
Henry V. Pettis, named president and chief executive officer of the 895-outlet pizza chain just last week, wants the move back to Nebraska to be completed by this summer, Pieper said Monday.
Only part of the Godfather's business operations moved to Costa Mesa last April, and the move was ordered to enable the company--a division of Diversifoods Inc., Chicago--to snare a chief executive who lasted only eight months.
80 Stayed in Omaha
About 80 employees in the company's financial, accounting and data-processing departments stayed behind in Omaha, while about 30 people transferred into the marketing, purchasing, human resources, advertising and executive offices in Costa Mesa. Only about half those 30 employees now in Costa Mesa are expected to make the move back to Omaha, Pieper added.
Pettis hopes to reverse a sharp decline in the company's earnings, Pieper said, by working more closely with its 70 franchisees. About half of them live in the Omaha area, although they run many restaurants in other parts of the country.
Company officials said Pettis was traveling to Omaha Monday and was unavailable to comment on the corporate headquarters transfer.
Between 1983 and 1984, Godfather's' pre-tax earnings plunged to $18.6 million from $121.8 million. The company blames the earnings drop in part on the costs of product development--especially its multimillion-dollar entry into the pan pizza market, which one restaurant analyst called an "overwhelming disaster."
Drains on Resources
Other drains on the company's resources, Pieper said, were the corporate move from Omaha to Costa Mesa and the costs of a zealous five-year expansion program.
Between 1980 and 1984, the number of Grandfather's pizza outlets more than doubled, to 895 from 394.
Company officials also acknowledged that, last year, average sales per outlet declined substantially--to $396,000 from $425,000. They said the drop came largely because of increased competition in the pizza fast-food industry.
Pettis, 40, joined Godfather's in March, 1984, as vice president of operations. Previously, he was an executive with Wendy's International. He succeeds Everett Jefferson, who was Godfather's chief executive officer for three months after Charles Boppell resigned under pressure in January.
Boppell, a former Taco Bell executive, moved Godfather's' corporate headquarters to Costa Mesa when he succeeded founder William Theisen as president of the company.
Condition of Contract
Last May, Godfather's shifted its corporate headquarters to Costa Mesa, Pieper said, to comply with a condition in Boppell's employment contract. Boppell, who had been president and chief operating officer of Pepsico's Taco Bell division, was living in Santa Ana and didn't want to move.
Another reason for the relocation to Costa Mesa, Pieper said, was that Godfather's "once looked to California as a growth market."
But now, he said, the company has decided to cool its expansion efforts and concentrate on improving the profits of its existing restaurants.