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Tom Sacco, the CEO and Chief Happiness Officer of the iconic pizza and ice cream restaurant chain Happy Joe’s has had a remarkable year. The first restaurant was founded in 1972 by Joe Whitty in Davenport, Iowa, who wanted to fuse pizza and ice cream – two of America’s favorite foods – into a family-focused and festive offering. Today, in 2022 alone, the company won the “Top 50 Contender” award by QSR Magazine, as well as the “Top 200 Concept” by FastCasual, the “Top 400 Business” by Franchise Times Magazine, a “Top 500 Restaurant” by Nation’s Restaurant News, and inducted into Pizza Marketplace Magazine’s “Hall of Fame”. Over the last two years or so, the company opened more franchises and locations than it had in the past 10 years and underwent a digital and branding transformation that laid the foundation for growth and outreach in new markets.
With 28 new franchise agreements inked during this time – representing a 60%+ increase in store count – as well as Q1, Q2, Q3, and Q4’s 2022 sales comping 12% or higher than 2020 figures, Tom Sacco and Happy Joe’s are turning the post-pandemic page and are rewriting the “eatertainment” narrative for all.
Q4 of 2022 was the eighth consecutive quarter that Happy Joe’s experienced positive sales growth and the company’s in-house, curbside, drive-thru, and dine-in channels all experienced significant sales upticks during this time. Whether you want a unique pizza creation for breakfast, lunch, dinner, or dessert, or want to celebrate a holiday, graduation, Mother’s Day, Father’s Day, or other festivities with friends and family, Tom Sacco wants Happy Joe’s to be your destination of choice. The same goes for schools, offices, and community organizations, all of which can avail of special discounts, vouchers, and time-specific offerings based on their needs and tastes.
2022 marks the 50th anniversary of Happy Joe’s. Much of the company’s recent successes and the increases in same-store sales and year-on-year revenue between 2020 and 2022 were driven by new franchise openings. The launch of a new loyalty rewards program built on a tech platform designed to integrate online, dine-in, and curbside channels also helped drive sales during this time.
According to Tom Sacco, what defines Happy Joe’s as a successful business is that it is one of only a handful of worldwide brands that connect emotionally with its guests. It is a very different type of pizza brand, one that looks at its pizza dough as a blank canvas. Happy Joe’s is not restricted by preconceived ideas of what toppings go on a pizza; instead, each pizza is like a canvas on which any new idea or innovation can be brought to life. The company is 50 years old but still growing because it has a brand that families value more now than at any time in its iconic past.
Some of the main challenges that the company faces is reaching critical mass. Tom Sacco has said that if Happy Joe’s had more restaurants spread across the country, it would be easier for it to sustain its growth. The company also faces many of the same economic issues facing everyone in the country and worldwide since having a stable workforce and a stable supply chain are prerequisites for successful growth and continued expansion in any industry.
In terms of the impact of the COVID-19 pandemic on the company’s current and future plans, Tom Sacco said that COVID hurt the company in the first few months until the leadership team got the company’s strategy aligned. Happy Joe’s already had its own in-house delivery and pick-up windows so that guests do not have to get out of their cars to pick up their pizzas and pasta, but these offerings required promotion. Once the marketing team started promoting them, they immediately set the company apart from the crowd. After the first six months of COVID, Happy Joe’s has had eight consecutive quarters of positive store sales increases over its pre-COVID sales numbers.
In terms of how the company positions itself against its main competitors and what differentiates Happy Joe’s from the rest, Tom Sacco says that it comes down to a focus on family connections. It focuses on being the place to celebrate any family event, and that offering is extended to school and community groups and events. Happy Joe’s says it creates lifelong magical memories for its guests and has put in the investment and foundation needed to deliver on that promise.
Happy Joe’s also relentlessly supports charities and causes. The company requires every franchisee to have an organization that supports special needs, the less fortunate, individuals in need, and those afflicted with certain illnesses or diseases. “Doing the right thing, for the right reason, and with a servant’s heart,” to paraphrase CEO Tom Sacco, is what the company’s corporate social responsibility mission statement might look like.
While Happy Joe’s has long been a US-only company with locations spread across the Midwestern and Southern US, it recently opened a new franchise in Egypt. Plans for additional locations in Egypt and across the Middle East are under contract now.
Talking about the company’s strategy for entering the Middle Eastern market as well as the challenges, opportunities, and plans for further expansion, Tom Sacco said that the company had gotten some press about its brand and had two different groups reach out to the management team over the same four-month timeframe expressing interest in bringing Happy Joe’s to Egypt and the Middle East. With this interest and Sacco’s experience operating American restaurant brands around the globe, this being his third time opening an American brand in Egypt, the company chose to move forward with the group that had the most familiarity with the brand and a better understanding of Happy Joe’s family-centric culture. The Egypt launch was wildly successful, with families queuing up in the exclusive Roxy neighborhood of Cairo to get their first taste of the gourmet menu.
The biggest challenges that the company faced came from pandemic-related supply chain issues, which were compounded by the war in Ukraine, which is where the majority of flour imported into Egypt came from. However, while working within this challenging context, the company hopes to expand into new countries and territories across North Africa, the Middle East, Europe, Australia, and Asia, when the time and opportunity are right.
Tom Sacco has said that much of the company’s future success will be built on doing what the company’s early leaders did. The only exception, he says, would be to focus more on nurturing new franchises and helping them expand slowly. Getting the building size right, operating with positive cash flows from day 1, and increasing annual sales of every new franchise takes time, and doing that the right way is critical for the success of new Happy Joe’s outlets.
The current and ongoing recession has had an impact on Happy Joe’s because the company did not increase its prices for over 3.5 years. However, the cost of labor and the rate of inflation for the goods and services the company buys had increased beyond the point that the old prices could not be justified, so prices for items invariably rose in 2022. However, sales continue to grow organically, and new tech-driven options continue to drive additional growth as well.
According to Tom Sacco, some of the best-known and successful Happy Joe’s restaurants include Happy Joe’s on Century Blvd., in Dubuque, IA, and Happy Joe’s on Spruce Hills, in Bettendorf, IA. These locations continue to lead the chain, year in and year out, in sales and guest counts. They both offer consistently excellent food and great value for the dollar, are heavily involved in their local community, operate with a Servant’s Heart and a Warrior Spirit, and are passionate about their business.
However, thanks to some of the company’s latest milestones – which include opening in Egypt in July and reaching the half-century mark, something that 90% of all US restaurants have not done – Tom Sacco believes the future is bright for all of Happy Joe’s franchises. With a new image (new building design), new branding (new website), and a new loyalty app (online ordering with technology enhancements) in place, the company achieved significant progress in areas where it had been lacking.
As a restaurant concept that focuses on serving America’s two favorite foods – pizza and ice cream – in a family-friendly, celebratory environment, and with rapid expansion underway, Happy Joe’s is living up to the awards it has received. Under the leadership of Tom Sacco and a rich, family-focused heritage that is beloved by people from all places and backgrounds, Happy Joe’s hopes to continue expanding and living up to the vision of its founder for decades to come.
