Verney to Try Turnaround at Winchell’s
James C. Verney, operations chief of the El Pollo Loco chicken restaurants owned by Denny’s Inc., was appointed president of a Denny’s subsidiary that runs the loss-plagued Winchell’s Donut Houses chain.
As head of WDH Services Inc., the 35-year-old Verney will have the task of trying to stem the severe decline in sales that brought the 40-year-old doughnut chain an $11.5-million net loss last year.
Winchell’s has more than 700 retail stores in 14 Western states. More than 300 of them are in the Los Angeles area. Most are company-owned, with a few franchise operations.
Verney will report to Jerome J. Richardson, president of TW Services, a New York food services company, which bought Denny’s last September.
Winchell’s is a master limited partnership, which is publicly traded on the New York Stock Exchange. The operation was a subsidiary of Denny’s when it was spun off in December, 1986. WDH is its general partner, and Denny’s owns 42% of its limited partnership units.
Since TW Services took over, much of the top management of both Denny’s and Winchell’s has departed.
Winchell’s previous president, C. E. Hass, resigned in December, followed in January by Donald L. Pierce, who was president of Denny’s and chairman and chief executive of Winchell’s. His responsibilities were taken over by Richardson, founder of Spartan Food Systems, which is a division of TW Services.
Separately, TW Services said Spartan has signed a development agreement with Hardee’s Food Systems Inc. that contemplates Spartan’s adding at least 135 new Hardee’s fast-food restaurants in Southern states in the next five years.
Spartan, which became Hardee’s first franchise operator in 1961, already operates 372 Hardee’s restaurants in the South.
Verney, asked how he expects to proceed in trying to reverse Winchell’s downward sales spiral, said: “Our market share dropped off significantly in the last year. Our mandate is (to) win it back, customer by customer and doughnut house by doughnut house.”
He said he will concentrate on working with the firm’s management team, seeing that older retail locations are put in good condition and motivating the workers to “do the best job with customers.”
Verney said he joined Denny’s in 1974 after graduation from college and worked his way up the ranks. He was a regional manger of Denny’s restaurants in the Chicago area when he was transferred to El Pollo Loco in 1984 as director of operations. In the past four years, he noted, that chain grew from 15 stores to nearly 100.
“My background is as a grass-root operations person,” he said. “I can relate to what’s going on in a 24-hour doughnut house.”
