The founder of Papa John’s International will step down as CEO next month, handing over his company just weeks after making controversial remarks about national anthem protests by NFL players, for which the company later apologized.
John Schnatter, who is featured on Papa John’s pizza boxes and in the chain’s commercials, will be replaced by Chief Operating Officer Steve Ritchie on Jan. 1, the company announced Thursday. Schnatter, 56, is still the company’s largest shareholder and will continue to serve as chairman of the board.
In November, Schnatter sparked outrage by blaming sagging sales at Papa John’s — a top NFL sponsor and advertiser — on the league’s “poor leadership” in response to the demonstrations during the national anthem.
He said the practice of players kneeling during the anthem to raise awareness of police brutality and social injustice hurt the NFL’s TV ratings, which in turn hurt sales of his pizza, which is advertised heavily during games.
“You need to look at exactly how the ratings are going backwards,” said Schnatter, who donated $1,000 to Donald Trump’s presidential campaign. “Last year the ratings for the NFL went backwards because of the elections. This year the ratings are going backwards because of the controversy. And so the controversy is polarizing the customer, polarizing the country.”
Papa John’s was the highest-profile sponsor to publicly pressure the NFL to resolve the protests, according to The Post’s Tracy Jan.
At the time, Ritchie, the Papa John’s COO, added that the pizza chain has been the most recognized NFL sponsor for the past two years — hinting that its success is more connected to the league than is the case for other pizza purveyors.
He said that he expected the earnings decline for Papa John’s “to persist” until “a solution is put in place” by the NFL for its player protests. Papa John’s has been a league sponsor since 2010.
The company apologized for its “divisive” comments.
In the days after Schnatter’s remarks, white supremacist publication the Daily Stormer dubbed Papa John’s as the official pizza of the alt-right. Papa John’s spokesman Peter Collins told the Courier-Journal that the company was caught off-guard by the endorsement and condemned “racism in all forms.”
“We do not want these individuals or groups to buy our pizza,” he said.
Ritchie, who told the Wall Street Journal that he was poised to eventually replace Schnatter when he was named company president in 2015, joined Papa John’s in 1996, making $6 an hour as a customer service representative, the company said.
He declined to specifically say whether the NFL controversy played a role in the timing of the transition, but told the Journal that “all of the PR things have been quite a distraction.”
“I want to put the focus back on our people and pizza,” he said.
Ritchie could not be immediately reached for comment.
Schnatter founded Papa John’s in 1984, when he began selling pizza out of the crowded broom closet of his father’s Indiana tavern, according to the company’s website. It has since grown to be the world’s third-largest pizza delivery company with more than 5,000 locations, according to the company’s statement. About 3,400 of those locations are in North America, according to the Wall Street Journal.
He stepped down as CEO once before, in 2005, after several years of slowed sales, and returned three years later after the quality of the chain’s products started to diminish, according to the Wall Street Journal.
The company’s sales growth has been slow across its North American stores in the third quarter compared with last year’s period, and therefore lowered its earnings prospects for the region. Papa John’s told the Wall Street Journal last month that it was reevaluating its NFL sponsorship because of the drop in viewership.
Schnatter plans to pursue his “personal passion for entrepreneurship, leadership development and education,” the company said.