State of the state: Dining
Scott Jennings opened the first Cheba Hut, a marijuana-themed sandwich shop, in Tempe, Ariz., in 1998. Now there are 16 locations, including five in Colorado and several on the way for Madison, Wis., and San Diego. Each Cheba Hut shares commonalities – psychedelic rock posters, Kool-Aid on tap, local art works (Denver’s is bookended by John Denver and John Elway), and the stock menu; although each shop has a unique “Secret Stash” of sandwiches only available at that particular location.
Nebraska-born and Fort Collins-based, Jennings is now plotting to open 225 franchisee-owned stores by 2025. He’s bringing in a new CEO to lead the charge because “sometimes it’s best to get out of your own way.”
CoBiz: Why has Colorado emerged as such fertile ground for Cheba Hut?
Jennings: I love Colorado. I’ve been here 10 years now. From Fort Collins, I can be in the sticks in an hour. I can be in the city in an hour. I can be in the mountains in an hour. I think it’s the freest state in the Union. Denver’s probably ground-zero. It’s [Cheba Hut’s] first downtown location. Most of our others we’ve done around colleges. In Colorado, the weed theme is basically over because it’s so common here.
CoBiz: What is the state of the U.S. sandwich market?
Jennings: They call it a free market. It’s free entry, but it’s really a monopolistic market. When you look at the big picture, Jimmy John’s has 1,200 units. Subway, with 39,000 units and $5 subs, doesn’t even count. Quizno’s screwed up when they went after Subway. For us, it’s getting these franchisees in place to grow. I’m such a customer guy and now our franchisees are our customers.
CoBiz: What’s Cheba Hut’s differentiator?
Jennings: Money is not our main reason for being in business. For us, it’s more about changing it up. The first thing I wanted at Cheba Hut was a cool place to work. If your employees aren’t happy, they’re just drones. Here you can be yourself. We judge you by your work ethic, not your appearance. But in the end it goes back to our food. Our meat is good – we pay extra for that. We make our sauces in-house. Our bread is baked fresh every day. Ranch dressing is big. We have ranch-chugging contests. We had ranch wrestling back in the day. We like to push the envelope. This is us at 16 locations – imagine us at 225.
CoBiz: How did you come up with the idea for a weed-themed sandwich shop?
Jennings: I just combined the things I’m best at.
CoBiz: Were you pro-Amendment 64 for legalization of marijuana in Colorado?
Jennings: I’m a realist, not an activist. People think we’re all getting high in the walk-in. Not true. When you have 30 sandwich orders, you have to have your s**t together.bWe’ve got to beat the stereotype. We’re professional stoners. When you get home, what you do is up to you.