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Conversations From the Corner Office
COMPANY HISTORY
California Pizza Kitchen
Larry Flax and Rick Rosenfield founded California Pizza Kitchen in 1985. The two were practicing criminal attorneys in Los Angeles when they decided to venture into the restaurant business. They envisioned a casual, family-friendly place sporting a menu of fresh-ingredient pizzas with unusual toppings, like duck sausage or pear and gorgonzola. They also imported specialized wood-burning ovens from Italy.
The company struggled financially during its first few years. The chairman of Golden Nuggets casinos, Steve Wynn, bought the first CPK franchise and placed the restaurant in the Mirage Hotel and Casino in Las Vegas. The restaurant generated $5.5 million in sales during its first year. Flax and Rosenfield didn't own that particular CPK, but the publicity surrounding it helped boost the company's opportunities in other states. In 1992, PepsiCo bought two-thirds of the company. At the time, the chain had grown to 25 restaurants with 1,700 employees.
In 1997, Pepsi sold its stake to a private equity group, which eventually brought in Fred Hipp from Houlihan's restaurants to serve as CEO. Flax and Rosenfield remained on the board as co-chairmen. In 1998, CPK partnered up with Kraft Foods, Inc., to sell a line of frozen pizzas in supermarkets and other retail stores. Two years later, the company went public, raising $72.5 million in its initial public offering. Over the next few years, CPK grew fast, but some units struggled because of poor location selection. In 2003, the board asked Flax and Rosenfield to return as co-CEOs.
To avoid similar missteps that hurt the company in the past, Flax and Rosenfield carefully research all real estate decisions to give new restaurants the best chance of success. They've also developed a corporate philosophy they call R.O.C.K. (Respect, Opportunity, Communication, and Kindness) in an effort to recruit and retain top-notch employees and maintain quality at their restaurants. Today, CPK has more than 200 locations in 29 states and six foreign countries.
RELATED LINKS
CO-CEO's LARRY FLAX, RICK ROSENFIELD
MORE AUDIO: How Flax and Rosenfield landed on the CPK concept
MORE AUDIO: How would CPK replace the co-CEOs with one?
Larry Flax's, Rick Rosenfield's bios
CORPORATE WEBSITE: California Pizza Kitchen
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