RANDY SIMON - CEO, President, Co-Founder Freddy’s Frozen Custard & Steakburgers

Segment: Fast casual Units: 380 Locations: California to Pennsylvania, Virginia, down the East Coast to Florida

We are known for our genuine hospitality and family-friendly atmosphere – typically associated with Freddy’s dine-in experience. With 90% of the system now operating on drive-thru only, we need to make sure that the emphasis is on getting our high-quality food and custard out in a timely and accurate manner. As always, our goal is to have fully staffed operations focused on taking care of guests the Freddy’s Way. More than ever, we want to make Freddy’s the bright spot of people’s day. The drive-thru is our new dining room!

We implemented a 1.5% royalty abatement, which began on March 18 to run through April 29. We will be funding an additional 0.5% of system sales toward a national digital marketing effort once operations return to normal. We understand this will not by itself solve any problems or create drastic improvements to the sales downturn, but we hope it shows our franchisees, our family, that we care about their business and the solidarity of our system. Despite the pandemic, we still have had a couple of successful new restaurant openings over the past few weeks. In the markets that can support it and have local training staff, we’ve opened with drive-thru only. We’ve had to adjust our training program to limit the number of team members in the restaurant at one time, and we aren’t able to send our corporate support team to support in person because of restricted travel, but the new locations have been able to serve their communities. In some areas we are choosing to postpone openings for the safety of our team members and are watching the local mandates for the best time to schedule successful openings.

Throughout April and May, guests earned 2x the points when they used the Freddy’s Rewards app at checkout or when they entered information from their receipt. In addition, the closure of our dining rooms during Covid-19 has served as an opportunity to fine-tune our drive-thru operations without compromising on our promise to serve quality, cooked-toorder food, and freshly churned frozen custard. Adjusting our process at both the speaker and window has helped to reduce the average check time by 15 seconds. This has the potential to increase the number of guests we can serve during peak times by 30%. Before Covid-19, we’d been testing a thirdparty delivery service and carefully analyzing the process of packaging our food for optimum quality through delivery. The timing and preparation made us ready to quickly begin offering DoorDash delivery as an additional option for our guests. Delivery is now available at a majority of our locations system-wide.

As local governments are determining reopening guidelines, we are preparing the gradual reopening of our dining rooms with our team member and guest safety as the number-one priority. We determined and applied changes to a local corporate-owned location, which serves as the example of what is being rolled out system-wide as restaurants reopen their dining rooms in other markets. We added barriers in between booths to reduce contact between guests, and have reduced the number of tables in the main dining area to help with social distancing. We have placed stickers on the floor to mark where customers can stand to maintain 6 feet of separation. We will generally reduce dining room occupancy to 50 percent and make every effort to comply with local guidelines as they are made known.

The trust of our Freddy’s family is extremely important to us. While markets across the nation will vary with reopening timelines and mandated regulations, we’re instituting new social-distancing along with enhanced cleanliness guidelines in each of our 380 locations around the U.S. to ensure consistency and a high standard for safety precautions across the board.