TravelCenters of America (NASDAQ: TA) is cutting 130 corporate jobs as part of a sweeping reorganization announced Friday that adds new executives to oversee restaurants, gaming and convenience stores, corporate development and information technology.
The Westlake, Ohio-based operator of 260 TA, Petro Stopping Centers and TA Express-branded travel centers and truck stops in 44 states and Canada, has more than 21,000 employees.
The reorganization is unrelated to the April 17 furlough of 2,900 travel centers and 122 corporate employees due to the COVID-19 pandemic that forced the closing of dine-in restaurants. Passenger car traffic dropped dramatically as shelter-in-place orders took hold in 40 states.
The reorganization plan overseen by CEO Jon Pertchik comes less than six months after the veteran turnaround expert was hired to improve operational efficiency and boost profits. Pertchik told FreightWaves in an interview in March that private competitors like the Pilot Company and Love’s Travel Stops & Country Stores were “eating our lunch.”
TA recruited three senior vice presidents, one for a newly created hospitality department to oversee consolidation of restaurants, gaming and convenience stores; as well as new leaders for corporate development and information technology.
Corporate development will oversee the reorganization, including leveraging TA’s purchasing muscle in vendor negotiations to save money and streamline operations. TA also wants to grow revenue though better convenience store merchandising, over-the-road delivery, truck repair training and staffing and IT systems.
“By reorganizing and enhancing our leadership team, we have taken the first formal steps in executing TA’s turnaround by repositioning management, redefining management roles and operating focus, and strategically adding new management who bring new and valuable experiences, skills and outlooks to TA,” Perchik said in a release.
The cost of selling goods outpaced the revenue generated over the past decade, Pertchik said. The 130 job cuts are expected to save TA $13.1 million in sales, general and administrative (SG&A) expense while costing $4.2 million in severance and outplacement.
“We have worked hard on planning and developing the reorganization and transition plan announced today,” Pertchik said. “I believe that this plan will result in major changes in efficiencies and improvements to TA’s business and position it well for future success.”
The newly hired senior vice presidents are:
Kevin Kelly – Hospitality, from Delaware North, a global food service and hospitality company, where he was President of Travel Hospitality leading a subsidiary of more than 250 food service and retail locations in 19 airports.
Dennis King – Corporate Development, most recently an associate partner at McKinsey & Company, where he spent more than 15 years leading retail and consumer company transformations.
Sandy Rapp – Chief Information Officer, a 30-year IT veteran who most recently was chief information officer of the Timken Company.
Separately, on March 2, Pertchik hired Peter Crage, formerly chief financial officer of Diamond Resorts, a $1 billion private equity-owned organization with 350-plus vacation destinations in 35 countries, as CFO.
Around the same time, Pertchik asked TA President Barry Richards to give up the secondary role of chief operating officer “to focus on chasing down things that are underperforming.”
In the March interview with FreightWaves, Pertchik said a mix of internal and external hires makes the best leadership team.
“I just want to get things done and go kick some butt,” Pertchik said. “And have the team around me to do it.”
Brian fraser
Change your rewards program!
Many of the drivers at our company have switched to Loves because you don’t give enough points and your showers expire quickly.
I was platinum member for 4 years but this year switched.
Nathan Dille
As a currently furloughed employee of TA, I hope these changes make some sence. The last restructuring created nothing but a lot of doubt and mistrust in upper management due to the way it was handled.
I talk to a lot of lower, site level, managers on a daily basis across the US and all of them echoed the same statement of “I dont trust my support from upper management.” Very little of the people picked to take over as DM or site GM knew anything about a majority of the departments that they were now making decisions for, and zero training was provided.
You cant successfully run a company with any competent lower level managers when the people above them know less than they do.
Pick your upper management wisely and off merit, make sure their knowledgable and not just living in the right geographic location, and you might just achieve a lower level management team that trust your actions and will have your back through the tough times.
Mike
Avoid the TA in Meridian, Mississippi. The shop is filthy and the technicians are poorly trained, unprofessional backyard grease monkeys that don’t follow procedure. The shop manager is inept and has no control over his shop. The store plumbing is shottie at best and the facility is rundown. The store staff is improving, but leaves much to be desired.
Rick
I totally agree with Mike. Get a locally successful operator to run the restaurant. See them prepare locally popular meals. Chili in Ohio, seafood in New England, Cajun in the south. Lose that tired old menu. Save the fast food for the Express locations and get Burger King out of the true truckstops. We dont goto the loves and pilots because they are better…… we go there because the TA and Petro have sunk so low they have gone down to that level.
Mike
Great, bring an airport hospitality guy in… Coffee will be $10 a cup and a hotdog $20. Not what we need out here. How about leasing out the restaurants to a local SUCCESSFUL entrepenuer that knows how to prepare affordable dishes and treat his customers. And get the locals involved, you need the locals to support the restaurant. Look at the operations in Morris IL, that restaurant is always busy, at least it used to be, and the locals supported it. Here in Dexter Michigan, that restaurant used to have a huge breakfast crowd, lunch used to be good too, and than the TA took over operations, right down the toilet and it has never recovered. Same old menu too, processed heat and serve dishes, I doubt they even have real eggs in the kitchen. And how about investing in a salad spinner? Why is the lettuce always sitting in a pool of water? Just nasty, and not healthy in the least. And don’t get me started on the fries, you get more in a McDonalds in a happy meal. And change the damn frier grease once in awhile! You guys have the facilities, sadly I doubt you will ever figure this out.