The third in a series of seven auctions is slated for today in Anaheim, Calif. Equipment from 27 Little Caesars Pizza restaurants in California and Arizona is up for sale at the session; everything from ovens, refrigerators and floor mats is being peddled to the highest bidder. It was unclear if leases were included.
The auctions, begun last week and to be held in several more U.S. markets, including Altamonte Springs, Fla., and Pittsburgh, involve 382 company-owned restaurants, a major slice of Little Caesars' portfolio. About 75% of the troubled chain, with some 3,700 units now, is owned by franchises.
"To say they were remodeling was the easiest thing to do," said John Correll, a pizza industry consultant. "They had to say something to attempt to save face."
Little Caesar Enterprises said in a statement Friday the restaurant assets had been sold to a third party for disposal. The store closures were first reported in Crain's Detroit Business last month.
The company said it will buy new equipment for any restaurants it remodels.
On top of the auction, the chain has cut back on network TV advertising for this fall (AA, July 26). Little Caesars spent $37 million on measured media in 1998, according to Competitive Media Reporting. For the first five months of '99, the chain spent $12.8 million. It also has halved the contribution franchisees are required to make for national advertising-from 4% to 2% of sales.
Bozell Worldwide, Southfield, Mich., the chain's agency since September, said a