Wendy's International, Inc.
Dave Thomas may have been the founder of Wendy's International, Inc., a fast-food chain named after his daughter, but when the company ran into trouble in the late 1980s, Thomas turned to James Near. Near, a successful Wendy's franchisee who had known Thomas since their early days as competing restaurateurs in Columbus, Ohio, set about to return the company to its formerly high standards, and enlisted Thomas himself in a highly successful advertising campaign.
James W. Near was born in 1938 in Columbus, Ohio. His father owned and operated a White Castle hamburger franchise which gave his young son early exposure to the restaurant business. Near worked as a short-order cook in his father's restaurants starting at the age of 15 and continued in the restaurant business for the next 42 years.
Near married his wife Nancy in 1972, and they had two sons, David and Jason. In 1992, Near received the Operator of the Year award from Nation's Restaurant News, and was voted Executive of the Year by Restaurants & Institutions. He cherished these awards and considered winning them the pinnacle of his career. He retired from the restaurant business in January 1995 and then spent most of his time at his home in Bonita Springs, Florida, where he enjoyed playing golf. While attending the Summer Olympics in Atlanta, Georgia, Near suffered a heart attack and died on July 22, 1996 at the age of 58.
After graduating from Hanover College in 1961, Near went to work in the restaurant business while also serving in the United States National Guard. He bought a Burger Boy Food-A-Rama store in Columbus, Ohio, at the young age of 23, and became acquainted with a Kentucky Fried Chicken franchise owner named Dave Thomas. The two men began years of friendly competition. In 1965, Near became vice president of Burger Boy and by the end of the 1960s, he had 50 Burger Boy Food-A-Rama stores under his ownership throughout the central Ohio area. Around this time, Thomas founded Wendy's, a new fast-food restaurant chain named after his daughter.
In 1969, Near left Burger Boy and took a position as executive vice-president of retail sales for Borden Inc. He soon become president of retail sales for Borden, but left in 1974. That same year he bought a franchise in his old friend's growing restaurant chain.
Between 1974 and 1978, Near opened 39 successful Wendy's franchises in West Virginia and Florida. In 1978 he sold his stores to the mother company, Wendy's International, Inc., and started the successful Sisters Chicken and Biscuits restaurant chain. Near sold his shares in Sisters Chicken and Biscuits to Wendy's International, Inc. in 1981, and left the executive ranks.
From the time of its founding in 1969 until 1985, Wendy's experienced explosive growth. The company had ridden the crest of a wave so strong it seemed it would never break, and along the way it shattered numerous fast-food industry records. This period of growth peaked in 1984, with one of the best-known advertising campaigns of all time, "Where's the Beef?", in which senior citizen Clara Peller addressed that rhetorical question to Wendy's competitors. But after record sales of $76.2 million in 1985, Wendy's fortunes began to sag.
In 1984 and 1985, Wendy's quarterly sales charts resembled a roller-coaster, and investors in the New York Stock Exchange were nervous about investing in the company. Wendy's highly paid executive had lost sight of the successful management styles that had previously made Wendy's a leader in the fast-food market.
First there was the introduction of breakfasts in 1986, an elaborate program which did not go with the fast-food concept. "Breakfast was failing and there were big shifts in the marketing department," stated franchise owner Bob Goodrich. "We were floundering and didn't know where to go." In addition, the quality in some of restaurants had declined, because the original owners had sold them to people who did not operate them personally or care about the company's standards. By the end of the year, company morale was sinking and one in every five Wendy's franchises was in danger of bankruptcy. This was the situation that Near inherited when Thomas asked him to become chief operating officer (COO) in 1986. Near had not been a part of the executive ranks of a large corporation since 1981, when he had sold his shares of Sisters Chicken and Biscuits, but Thomas felt that Near was the right man for the job.
"I wasn't happy with what was happening," Thomas stated. "We were losing sales and profits, and it was just a very obvious thing — that you just don't keep on the same track. (Near is) very difficult if you don't do your job and very supportive if you do." So, in 1986 Near was hired as president and COO of Wendy's International, Inc. and immediately set about to get the company back on solid ground. Near was a passionate believer in the benefits of capitalism, and concluded that the best way to return the company to its top position in the industry was to give Wendy's customers exactly what they wanted.
Chronology: James Near
1961: Graduated from Hanover College.
1961: Bought first Burger Boy Food-A-Rama store.
1965: Became vice-president of Burger Boy.
1969: Left Burger Boy.
1974: Purchased first Wendy's franchise.
1986: Hired as president and COO of Wendy's International, Inc.
1989: Named CEO of Wendy's International, Inc.
1992: Received Operator of the Year award.
1995: Stepped down as head of Wendy's International, Inc.
Near started reorganizing Wendy's by changing the things that customers saw. He imposed new high standards for cleanliness for all franchisees, and redesigned the menu in line with several trends in the market. First, in response to the desire for discount pricing in the wake of the early 1990's economic recession, he introduced a daily feature of seven items priced at 99 cents. At the same time, though, he also introduced premium items, such as the Big Classic and Dave's Deluxe burgers, to appeal to big eaters who did not mind paying a few extra cents for a special burger. Finally, Near made Wendy's more responsive to growing health concerns by improving the salad bar and introducing a skinless chicken breast sandwich.
Near's next act was to bring the company's founder out of semi-retirement. While Near paid attention to the nuts and bolts of the company, he needed Thomas as a front man. Thomas became a traveling ambassador for Wendy's throughout the country. In 1989, Thomas began going in front of the cameras to promote his company in a series of advertising spots. Initially these met with an unenthusiastic response but eventually the Thomas advertisements proved highly successful because they allowed customers to identify with Thomas as a jolly father figure.
In 1989, Near became the chief executive officer (CEO) for Wendy's International, Inc. and started the last phase of what would become a very successful corporate turnaround. He reorganized and cut expenses at the corporate level, but raised pay for employees and increased their benefits. He also introduced a highly successful stock option plan called "We Share."
As a result of Near's hard work and wisdom in utilizing the talents of his boss and the company's employees, Wendy's recovered from its slide into the red. Earnings rose, even in a recession, and the chain's profit margin was higher than that of leading competitors. By 1992, Wendy's had 4,000 stores worldwide, and had plans to open another 1,000 within the next few years. Though Thomas became the public face for the company, business leaders recognized Near as the man who had engineered Wendy's successful turnaround.
In January of 1995, Near stepped down as CEO. His father had died at a young age, and Near realized that he did not want to spend the rest of his life inside the executive ranks living a corporate lifestyle. Near had started the search for his successor almost immediately after taking his post at Wendy's International, Inc. in 1986. "My first challenge as president was to find someone else to take the reins," Near said. "My dad died at an early age and I realized earlier that this was not where I wanted to be. I get too intense. So I started looking around for bench strength." Near turned over his title and most of the responsibilities that went with it to Gordon F. Teeter, who had been hired by Near in 1987 and had been groomed ever since as his successor.
Social and Economic Impact
Near was a hands-on leader who was known occasionally to stop in at a Wendy's franchise and actually work in the kitchen making hamburgers for a few minutes. He was also a frank and outspoken figure within Wendy's International, Inc.
By 1994, Wendy's International, Inc. revenues amounted to $359 million with net income of $29.8 million and a profit margin up 16.2 percent. The company provides numerous jobs, not only for those who work at all levels within the company but also for outside suppliers. Wendy's has reclaimed its position as a leader the in the fast-food industry. The company provides millions of fast and hot meals to customers every day.
A mark of Near's ability was the respect given to him by one of the most successful entrepreneurs in America, Dave Thomas. When he hired Near as COO, Thomas had business cards printed which said, "Founder and Jim's Right Hand Man." On Near's passing, Thomas said, "He knew more about restaurants than anyone else I know. His passion for customers and employees was evident to everyone who met him." Though Near died relatively young, his legacy continues at Wendy's. The company embraced the theme he gave it: "Do It Right! Performance Pays!"
Sources of Information
Contact at: Wendy's International, Inc.
4288 West Dublin-Granville Rd.
Dublin, OH 43017-0256
Business Phone: (614)764-3100
"He Always Found the Beef." Business Week, 5 August 1996.
"James Near 1938-1996." Restaurant Hospitality, September 1996.
Kepos, Paula, ed. International Directory of Company Histories, Detroit: St. James, 1994.
"Near, McLamore Mourned." Restaurants & Institutions. 15 September 1996.
Thomas, R. David. Dave's Way: A New Approach To Old-Fashioned Success. New York: G.P. Putnam's Sons, 1991.
"Who's News: Wendy's Chairman Who Led Turnaround Dies of Heart Attack." The Wall Street Journal, 24 July, 1996.
Who's Who In America 1997. New Providence, NJ: Marquis, 1996.
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