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Hats Off!

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This story appears in the December 1996 issue of Entrepreneur. Subscribe »

When Pizza Hut bought out Straw Hat Pizza nearly 10 years ago, Straw Hat franchisees faced a dilemma: Either convert or go independent. For a number of franchisees, neither option was appealing, so they came up with another alternative. They opted out of the Pizza Hut franchise and established a cooperative to retain ownership of the Straw Hat name, operating systems, recipes and logo.

Today, Dublin, California-based Straw Hat Cooperative Corp. is going strong, with 50 members and 65 locations throughout California, Nevada and Washington. An average of six new stores are added each year. All decisions guiding the company are made by an elected board of directors.

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