Expanding a Legacy: New Leader Guides Taco John's Forward

Name: Heather Leed Neary
Title: President & CEO
Company: Taco John's International
Units: Approximately 360
Age: 49
Years in franchising: 20
Years in current position: 3 months

Heather Leed Neary made a big career move in March when she joined legacy Mexican QSR brand Taco John's as president & CEO.

Neary has been in franchise leadership roles for nearly two decades. Fifteen of those years were at Auntie Anne's. That's where she moved through the marketing department to the top spot as brand president for the pretzel chain, which saw gross sales grow to more than $550 million under her leadership. Her next move took her to KBP Brands, a mega multi-brand franchise operator with more than 1,100 KFC, Taco Bell, and Arby's locations, where she served as brand president for almost three years.

She is known for her commitment to excellence and operational efficiency. She also encourages a culture of collaboration and empowerment that focuses on people. "Not a week goes by that I don't talk or text or email with my team (Auntie Anne's) there and my franchisees there," she says.

Now, a few months into her tenure at the 55-year-old Taco John's, she's leading the brand into an expansion in its Midwest stronghold as well as into new markets and, of course, building relationships with her new team members.

She says she's looking at "lowering costs and driving top-line sales" and continuing to "grow the footprint of the brand in a smart and thoughtful way." She says the brand will be expanding its marketing efforts and reach by targeting different media channels, and guests can expect new menu items on the way.

On the development side, Neary says the brand is working to optimize build-out and remodeling costs and to enhance unit-level economics. She says Taco John's wants to "deliver a great value proposition to our current and future franchisees."

LEADERSHIP

What is your role as CEO? At Taco John's, I am here to remove barriers so our incredible team can support our franchisees and grow our business.

How has Covid-19 affected the way you have led your brand? I wasn't here at Taco John's during Covid. I was the brand president at Auntie Anne's. In a matter of three days, we went from having one of our best years ever to closing more than 80% of our restaurants and laying off or furloughing 72% of our team. It was a devastating time for the brand and, more importantly, for the people I'd come to call my extended family and friends. I definitely think Covid taught me more compassion and taught me to never take anything for granted. The time during the pandemic also taught me how resilient the team was at Auntie Anne's and how gritty we were to figure out alternate ways to bring in revenue during times when our malls and airports were ghost towns. I wouldn't ever want to go back there, and I also really appreciate the lessons learned during that time.

Describe your leadership style. I want all our team members to feel respected, trusted, and honored. I am here to coach and serve our team to help them reach their goals, so they can help us reach our goals. In a nutshell, I work hard every day to lead with humility, passion, and directness.

What has inspired your leadership style? I've had the honor to work for many amazing leaders in my past. I like to think I take a little from each of them to move forward. I also turn to my friends and family and learn from them. I've been fortunate to have many inspirational leaders over the years, and I hope I can honor them in how I lead today.

What is your biggest leadership challenge? Hands down, patience is an opportunity for me. I am constantly reminding myself that good work takes time. We have so much awesome work ahead of us at Taco John's; I can't wait to see it come to fruition. And that's the issue: Sometimes, I literally can't wait.

How do you transmit your culture from your office to frontline employees? I believe culture is the responsibility of every single one of us. I want to learn from all our team members in restaurants, in the field, and in our offices. A culture of diversity, inclusion, and respect is a recipe for success. We honor each other, we celebrate our successes, and we work together to improve the areas that require a little work.

How can a CEO help their CMO develop and grow? A CEO is responsible for helping all the leaders on the team to achieve their goals and, by default, the goals of the organization. It's important to stay close to the CMO and understand their challenges and help them work through tough spots. I've always believed that everyone fancies themselves a marketer, and the CMO tends to have quite a bit of scrutiny. Support, coaching, sounding board: This is how we help our CMO develop and grow.

Where is the best place to prepare for leadership: an MBA school or OTJ? I don't think it has to be an either/or proposition. There's something to be said for formal education, and there's also no doubt that the school of hard knocks (aka, life) is also a great teacher. I believe in both and think one can be successful without an MBA, but on-the-job experience is critical for growth. In the restaurant industry, being able to walk the walk and talk the talk of your operators gives you far more credibility than a degree hanging on a wall.

Are tough decisions best taken by one person? How do you make tough decisions? As CEO, it is my responsibility to take in all the perspectives and viewpoints that lead to that decision. At the end of the day, it is my responsibility to make that decision, explain the why behind the decision, and own it. I tend to look at the decision from all angles, and I play out for myself what would happen depending on different scenarios. Not every decision will be right, but I will learn from all of them, and I will take accountability for those decisions.

Do you want to be liked or respected? Again, not an either/or here. I think everyone wants to be liked. In my role, though, I understand that I can't make everyone happy. Ultimately, I need to do what's right for our people and for Taco John's. I treat everyone with respect and hope that even if I'm not liked for a particular decision, I'm respected for how I treat people.

Advice to CEO wannabes: Be curious. Ask questions. Read a ton. Listen to podcasts. Don't hesitate to ask your board for help. Turn to your mentors for advice. Recognize that you won't always get it right. Understand that vulnerability and humility will take you far. Never compromise your values. It's not easy. It is rewarding. It is worth it.

MANAGEMENT

Describe your management style: Working with my leadership team, we set the strategies and goals, and from there, I expect our team to work toward those goals autonomously. I am not a micromanager. I am here to support, coach, and guide along the way.

What does your management team look like? We have a great blend of experiences and personalities, and I'm fortunate to work with such a strong, high-integrity team. Our head of HR and our GC have both been here for quite a while and have a deep history of the brand that's so important. We also have folks on our team who are newer to the brand but have a wealth of industry experience and knowledge. We make a great team!

How does your management team help you lead? We work together. Lots of communication. We're all in this together and focusing on people and culture will lead to results.

Favorite management gurus: Do you read management books? (please name): I read constantly. I have a pile on my nightstand that is rarely less than 10-12 books. Right now, I'm rereading Begin with We by Kyle McDowell. It's an amazing, quick read on building culture. I like anything from Adam Grant. I also recently read Atomic Habits by James Clear and The Comfort Crisis by Michael Easter. All are great leadership books and help me continue to refine my approach and style.

What makes you say, "Yes, now that's why I do what I do!"? Oh man, so many times! I love this industry--it's truly the industry of opportunity. I was just talking to a franchisee last night at dinner. He had to drop out of college many years ago when his dad fell ill, and he had to support his family. He started at Taco John's as a crew member, eventually rising to GM. At some point, our founders offered him a franchise, and the rest is history. I think his quote last night was something like, "I'm living the dream. The son of a truck driver, and I own my own restaurants." There are countless stories like this.

OPERATIONS

What trends are you seeing with consumer spending habits in your stores? Our guests are looking for quality and value, and we can deliver both for them. We have a robust value menu that we continue to enhance, and we offer a really fresh product. Our taco shells are prepared in-house daily, our pico is made fresh in the restaurant every day, and we have signature items like Potato Olés and Churros that really make us a destination.

How is the economy driving consumer behavior in your system? We need to continue to be flexible in what we offer our guests while making sure to focus on profitability for our franchisees. The margins in our business are super slim, so every decision and every promotion are weighed heavily in collaboration with our data analysts, our franchisees, and our partners.

What are you expecting from your market in the next 12 months? We are doing some branding work to really identify who we are and who we want to be based on deep consumer insights. We'll use this information to make sure we're positioned competitively in the marketplace and also ensure that we're relevant to our guests. This will happen with new menu items and expanding the outreach of our marketing efforts by targeting different channels.

Are your franchisees bullish or bearish about growth and adding additional units? Our franchisees are eager to grow. We are working on further improving our development process so that the build-out costs are optimized and the remodel costs are optimized. We're also working on improving unit-level economics for our restaurants.

Are commodity/supply costs any cause for concern in your system? All costs that impact our business are a concern. We continue to work with our vendor partners to identify ways to be as efficient as possible in all our buying.

In what ways are political/global issues impacting the market and your brand? Any factors that impact our guests impact us too. We are a fun brand that delivers great-tasting tacos to our guests. We want to bring some levity to our guests in a world that can be heavy at times.

TECHNOLOGY

How much influence does your IT department have on your brand? Our IT team is top-notch, and we collaborate across marketing, ops, technology, and our franchisees to make sure we're as efficient and effective as possible.

How does technology influence your decisions? We weigh the value/cost equation when making tech decisions in collaboration with our franchisees. Will this deliver a better guest experience? Will this decision make our restaurants more efficient? What is the ROI?

Are you using AI? How? We've recently partnered with Presto to improve the guest experience at the drive-thru with an AI tool. We have this in two restaurants now and plan to continue our implementation efforts. It's an exciting time, and we need to be prudent and data-forward when thinking about how we use AI in our business model.

How do you measure your ROI on technology investments? It's a value-based equation. Are we speeding up service? Are we driving sales? Are we being more efficient? These are all ways for us to measure the ROI of technology investments.

How did/do you create a culture where use of technology advancements is welcome and used? Technology is meant to enhance, not hinder, our business model. If we can confidently explain the why and how, we can gain buy-in from our franchisee system to advance technology forward.

PERSONAL

What time do you like to be at your desk? I'm a morning person. You're likely to find me working between 7 and 8 a.m.

Exercise in the morning? Wine with lunch? I am an avid, some might say OCD, runner. I get up between 4:30 and 5 a.m. daily to run five to six miles, stretch, and do core and strength training. I am a better person, physically and mentally, when I exercise first thing in the morning.

Do you socialize with your team after work/outside the office? Developing deep relationships with our team and our franchisees is important for our success. Sometimes, talking through a challenge over a great dinner is the best way to advance the brand forward. I am still very close to my team at Auntie Anne's. We worked together through some pretty dramatic challenges, and I consider them all to be dear friends. I left Auntie Anne's in 2020 after 15 years, and I can say that, to this day, not a week goes by that I don't talk or text or email with my team there and my franchisees there. We became very close, especially during Covid when we had to temporarily close almost our entire system.

Last two books read: Beautiful Country by Qian Julie Wang and Invisible Child by Andrea Elliott.

What technology do you take on the road? When traveling for work, laptop, iPad, iPhone, and AirPods.

How do you relax/balance life and work? I have the most amazing friends and family and love to play golf, run, and enjoy a great meal with these folks. My grandkids are the light of my life, and I love hanging with my two adult daughters and their significant others. I am a better leader when I decompress and find time for myself. I don't think about it as balance--that implies 50/50. I love to work, and I love to play. It's about harmony and finding the happy medium. I'm a pretty high-energy person, so I don't need a ton of downtime, but I do know when it's time for me to pause, and I don't mind taking the time to refresh when that happens.

Favorite vacation destination(s): I have a ton of wanderlust. I love to travel and explore the world. It's hard to pick one place. I love the beach. I love Europe. I love visiting our National Parks (heading to Glacier National Park next month). I've also had the opportunity to visit Africa a couple of times and am going back next year. Travel is so nourishing to my soul.

Favorite occasions to send employees notes: Gratitude and recognition are two pillars for me. I am a big fan of handwritten thank-you notes and tend to do this when a team member goes above and beyond and when a team member presents on behalf of the company--anytime, really. I make a point to send out thank-you notes at least once a week.

Favorite company product/service: Peloton! I'm a Peloton junkie. I used to be a gym gal, but during the pandemic, I discovered this amazing platform and haven't been in a gym since. The content is top-notch: running, biking, strength, cardio, yoga, and meditation. And the coaches are really motivating to me.

BOTTOM LINE

What are your long-term goals for the company? This is a 55-year-old legacy brand with an incredible history. I am eager to continue improving the business model by lowering costs and driving top-line sales. Long-term goals are to continue to grow the footprint of the brand in a smart and thoughtful way.

How has the economy changed your goals for your company? The economy will always influence the goals of our organization. Interest rates, construction costs, and consumer confidence: We will adjust our goals as these areas ebb and flow.

Where can capital be found these days? Capital is available. It's just a matter of how much one has to spend to secure capital. This will continue to impact our organization.

How do you measure success? Am I living by my values? Am I honoring my team and helping them reach their goals? Am I honoring my family? Am I helping my franchisees realize their goals? These are the questions I ask myself every day.

What has been your greatest success? I am very proud of my relationship with my husband. We've been together for more than 25 years, and I love him today more than ever. We are a true team, and I am beyond fortunate for his support and encouragement. We are polar opposites in many ways, and that's worked so well for us. I am blessed to have two amazing daughters who make me so proud too. Life isn't always easy. Take the high road, and you'll never be disappointed.

Any regrets? I remember being in college, maybe 20 years old or so, and thinking I didn't want to get to the old age of 30 and have regrets. To that end, I have always taken risks and done what my heart and my head told me was right, and I've made many mistakes and learned so much. So, no. No regrets!

What can we expect from your company in the next 12 to 18 months? You'll continue to see amazingly tasty products from Taco John's. You'll also see us dial into our audiences in new and unexpected ways, connecting with our loyal fans and reaching out to new fans. Look for continued product innovation, unit growth, and a lot more relevant news from Taco John's.