We’ve rebuilt our internal development team across construction, real estate, administration, every facet of the development pipeline is really to get this domestic development engine rolling. And there will be a huge amount of value creation over the next 5 years from doing that, okay? So I just want to make that point. Then to speak directly to your international question, there’s really three markets that are impacting our openings over the next couple of years. One is the U.K. The U.K. has been a strong development market for us. We’ve been opening about 50 units a year in the U.K. for the last couple of years. The problem is those restaurants haven’t always been the best restaurants, hence why we’re choosing to close some of them. We have moved away from a strategy of open restaurants at all costs and give franchisees the ability to open restaurants at all costs, like we are making sure that the restaurants that are opening, moving forward internationally are looked at with the same scrutiny that we have domestically.
If someone submits a site domestically, we go out and check the site, make sure it’s a good site. We do all the analytics to make sure that this restaurant has the greatest chance and probability of success. We haven’t been as disciplined internationally. So we are implementing those capabilities and that oversight. That’s why we put 3 business units, built 3 business units in the regions where we want to grow to be able to give some of that infrastructure and support to these markets. So the U.K., Russia and the Middle East are the 3 markets where we have been really successful at developing over the last 5 years and have been impacted over the last couple of years and more recently in the Middle East. So those are the openings challenges.
But this number that we put out today is really a function more of closures than it is a lack of openings. We are closing — we’re strategically closing these 50 units. sThat takes the number down from our run rate right out of the gate. And then we’re also working with franchisees to help them optimize their portfolio of restaurants. If franchisees are spending resources running restaurants that are never going to be profitable, that’s taking away the resources from the restaurants that they should be focused on growing and building new restaurants that can perform better than the suboptimized restaurants that are already operating. So we have baked in strategic closures globally into that number that we shared today. So once we get through that optimization of the global footprint and assuming that some of these geopolitical macroeconomic situations change, we have every belief and confidence in our long-term international growth rate and development.
Operator: Thank you. And our next question coming from the line of Andrew Strelzik with BMO Capital Markets. Your line is open.
Andrew Strelzik: Good morning. Thanks for taking my question. I just had a clarification and then a question. On the acceleration in — or the increase in U.S. opens, is that growth going to be back half weighted given the timing of the incentives and build times and things like that. So that’s just a clarification. And then my question is about the international transformation initiatives. You talked about the hubs U.K. optimization. I’m just curious what’s next on the checklist within that transformation? Or what are the next milestones kind of thinking maybe more from an operational perspective than the footprint? Thanks.
Rob Lynch: Great questions. I mean development is always kind of back-half weighted. Q4 is always the biggest development quarter. So that’s kind of the normal cycle of development. That being said, yes, I would expect that the upside potential of the development incentives that we put out there would come to fruition later in the year, given the — if they’re just starting some of these projects in Q1, it’s going to take 7 to 9 months for those to come to fruition. So yes, is the answer. On the international side, building these teams, we still have markets internationally that don’t have digital ordering. I mean that’s — that — every market and every restaurant in every market globally does not look like the Papa John’s model that you see here in the U.S. There are markets that aren’t — some markets use aggregators at scale almost exclusively.
Some markets have really not yet tapped into the aggregator model. Some markets have not been leveraging product innovation to drive their business. There’s a lot of different things. These hubs that we’ve built in APAC, EMEA and Latin America will be — we’ll all have marketing, technology and operational resources to guide their future path and drive not just new store development, but profit comp and profit growth in the stores that already exist. I mean if we were able to increase the international AUVs just to 75% or 80% of what we have in the U.S. I mean the amount of income growth for our franchisees and royalty growth for us would be worth 2 to 3 years of new store development. So we really fundamentally believe that we can help these franchisees significantly accelerate their comp and profit growth through the investments we’re making in these regional hubs.
Operator: Thank you. And our next question coming from the line of Dennis Geiger with UBS. Your line is open.
Dennis Geiger: Great. Thank you. Rob, I was wondering if you could talk a little bit more about your comment on the consumer changing a bit as the calendar turned. And certainly, we’ve heard this from others this earnings season. But can you highlight anything more on what that means and what you’ve observed with your customer, whether it’s ordering or spending patterns? And more importantly on that, you talked to the barbell strategy, but can you speak a little more to your value efforts, maybe where value scores are and sort of how you’re thinking about promos and value in what looks like an increasingly promotional category right now? Thank you.
Rob Lynch: No, it’s a great question, Dennis, and I think you nailed it. We have seen across this industry and across retail and across a lot of industries. Just a little bit of consumer spending softness. I don’t think it surprises any of us. given where the credit cards are at and some of the other macroeconomic dynamics at play. That being said, I have continued to reinforce and it’s based on historical data that our segment of this industry is well positioned to persevere and grow through tough challenging consumer and economic times. I mean that’s what we’ve seen in the past. We, being pizza offer an amazing value relative to the other segments of the industry, whether it’s whether it’s dine-in or other QSR. And I would argue that the gap has never been greater.
