I randomly met Paul Tran on Twitter one night.  We got to talking, and he blew me away.  This guy is sharp and very in-tune with the restaurant community.  While no longer running his own restaurant, he now focuses on franchising and equity.  Trust me, this interview is a must read for owners!

1. Paul, after reading through your Linked-In profile, I am impressed.  You are a former successful restaurant owner now focused on franchising and equity.  What’s the story behind where you are today?

“After I sold my restaurant to a private equity investor, I wanted to go back to where I came from initially – the financial services industry – because many people know how to make money, but not many know how to grow, protect, and enjoy it at full capacity.  But I still love the restaurant business, and had many folks who wanted me to help consult on operations, growth, real estate, legal, and marketing matters, so I have an extra stream of income advising restaurateurs on their business.  Call me a crazy workaholic and I’d probably respond =)”

2. You have owned restaurants and spoken with many owners.  What do you think is the most difficult part of owning a restaurant?

“I think the most difficult part of owning a restaurant is operating without a system.  I worked 80 hours a week in my restaurant for an entire year before I realized I needed to create a process for EVERYTHING – customer dialogue, inventory/employee/operations management, etc…because lack of processes and procedure can take your time away from increasing opportunities, enjoying a balance of life, and focusing on what’s most important. A consistently superior experience is what keeps a customer coming back and keeps them raving about your business, and you can’t do that without systems. That’s what I learned first-hand, as well as seeing why a franchise is SO attractive – a business model with systems in place so that you can focus on more “Business Owner Tasks” like marketing, opening new locations, enjoying the fruits of your labor, etc.  You can’t run a business at its peak without a clear vision and a business plan; operating at max profit, at max capacity, at max customer satisfaction is no different.  SYSTEMS are HIGHLY recommended, folks read the book “e-myth” to get what I’m saying…”

3. I see owners who spend a majority of their time in daily operations.  Which I believe can cause them to lose sight of their business vision.  In your opinion, what should be their main focus?  Should owners act like a CEO or an employee?

“I think that CEO’s should act like CEO’s and help lead the entire company, not lead the sandwich table or the back kitchen operations.  Those skills can be easily hired and trained if you know what kind of culture and expectations you have.  You are the owner, and you are meant for more strategic things, like I mentioned – opening new locations, finding new marketing initiatives, etc.  But that doesn’t mean you don’t know whats going on in the trenches; touch on your general/kitchen/district managers often, be aware of how your front linesman are doing, because they interact and are the face of the customer.  Be in the stores sometimes just to let them know that you, their fearless leader, haven’t left them for dead.  But remember that you are a BUSINESS OWNER and not an EMPLOYEE-OWNER.  Communicate that your role is to ensure that you are taking care of things like ensuring your employees are happy, providing the resources to do their job, and they are ensured as much job security as possible.  You can’t do that in the kitchen making pizzas.”

4. You are heavily involved with franchising these days.  Franchises like McDonald’s, Papa Murphy’s, and Subway were widely successful in 2009.  What lessons can local independent “mom n’ pop” restaurants learn from such franchises?

“As communicated above (sorry for being redundant, I feel so strongly about these things!), having a system is important, consistency is key as well, communication with customers keeps them loyal (social media makes reaching out to clients a no-brainer), continually training your staff and holding them accountable (with reports, measures, etc), be know for something positive (branding), and treat your company -big or small or in between – like a world class organization.”

5. More and more restaurants join social media platforms daily.  How should restaurants use platforms like Twitter or Facebook to build their business?

“I think that they should use Twitter/Facebook with the knowledge that this is a customer service, branding and marketing platform, and requires a FULL-TIME effort.  It requires that organizations respond to customers immediately, find new ways to connect with customers and bring them back to your restaurant, be personable, reward your raving fans of express loyalty and referring, and not to be salesy – be a personable brand that people can and feel proud to relate to.  Try not to outsource, because it’s hard to outsource your internal brand personality.”

6. You sit down to a nice dinner:  Fish or Steak?

BEFORE I HAD GOUT, STEAK =P

It’s no secret, chain restaurants are ultra successful business models.  They work.  They work extremely well.  Have you ever asked why?

Look, we are not promoting large corporate chains.  We love local restaurants and bars!  Helping every local restaurant in this country is our goal.  That doesn’t mean we can’t analyze chain restaurants and learn from them.

In 1955, Ray Kroc started a little chain hamburger joint called McDonald’s…maybe you heard of them?  McDonald’s was an instant classic.  You can read their story here.

The success of McDonald’s did not happen overnight.  Two brothers wanted to streamline their small hamburger stand for efficiency.  They started drawing out the flow of their kitchen on a tennis court.  Everything was strategically placed to maximize efficiency and consistency.  Then they took it a step farther.  They developed an in-depth how-to manual that someone in high school could follow.  Viola, fast food is born!

Here are 5 strategies independent restaurants can learn from McDonald’s:

You MUST Plan Operations

What is the major success behind McDonald’s?

Operations…

Every chain and fast food restaurant has copied this pattern:  Build an in-depth infrastructure that is highly efficient and consistent.  Independent restaurants rarely take the time to develop a solid manual.  You need to develop charts, manuals, and how-to pictures for the staff.  These should be set as “guidelines” for your staff to follow.  Post these charts directly in the kitchen for quick reference.

I know it sounds like a ton of work, and I am not suggesting you run a Nazi Regime.  In the end, you are still running a business.  Imagine how streamlined your business will run.  Fast food adopted these strategies to pump out a consistent product.  Your independent restaurant can enjoy the same success if you take the time.

Consistency is Key!

Why do millions of people go to McDonald’s everyday?  Two reasons:

• You know what your getting
• The price is right

People visit McDonalds everyday based on expectations.  Do they think the food is amazing?  Not likely…but they expect it to taste the same every time.  This level of expectation keeps people coming back.

Chain restaurants like Ruby Tuesday, Applebees, or Friday’s post in their kitchen how-to photos of entrees directly on the line for cooks.  When your kitchen is slammed, it is much easier to look at a picture and duplicate it.  Chef Gordon Ramsey also uses this method on the show Kitchen Nightmares.  Take the time to develop how-to photos and post them on your line.  The more consistent your product, the more customers will consistently come back.

Show me the Money!

McDonalds offers an extremely affordable dollar menu.  Guess what, you’re not McDonalds.  That doesn’t mean you cannot offer affordable alternatives.

The NRA listed local foods as the hottest trend in 2010.  Organics and healthy choices are also predicted to be big this upcoming year.  Take advantage, offer a reasonable lunch menu and emphasize your local support.  Most people will pay the extra dollar for something local and amazing.  You don’t have to offer a dollar menu, but a limited lunch menu for $6.99 is right on target.

Are you an Owner, or Employee?

When Ray Kroc evolved the McDonald’s Brother’s Operations into a nationwide franchise, he never looked back.  The operations manuals were set in place.  McDonald’s could teach a monkey to sell hamburgers, and people will buy them.

A big problem with owners is they still take on the responsibility of an employee.  They want to oversee the kitchen everyday.  They are constantly monitoring the floor.  Are you an owner, or an employee?

With solid operations and guidelines set in place, your manager can handle daily work.  I understand not all restaurants are big enough or even set goals like this.  But if  your goal is to open multiple restaurants and expand, than you must act like a CEO.

By setting a solid system and letting managers handle the daily work, you are free to focus on expansion.  Things like marketing, financial duties, and business opportunities.  This is the only way your business will grow.  Put the trust into your plan, and focus on expansion.  It was certainly a profitable model for Ray Kroc.

Do you Realize Curbside Potential?

It’s no secret, I used to work at a Ruby Tuesday’s.  They do a curbside to-go service, it’s basically carryout without the McDonald’s drive-thru window.  The customer orders ahead, drives up, and their food is brought to them.  This accounted for probably 25-35% of our business.  Do you realize how much business opportunity is there?

Designate one server as your curbside server.  They will take all phone orders and ring them in.  This also puts them in charge of gathering utensils, napkins, and food.  Have them run it out to cars as they pull up to your restaurant.  Most servers won’t mind doing this because people generally tip for curbside.  Promote your curbside menu across all social media platforms.

McDonald’s has drive-thru and Ruby Tuesday has curbside.  The goal is to move more products.  Learn from these chains and start promoting a curbside service.

What do you guys think?  Can independent restaurants learn from McDonald’s?  Leave your comments below!

I love talking with restaurant owners through social media.  Over this past year, I discovered the 2 deepest secrets that most restaurant owners fear:

1.  Keeping staff motivated, consistent, and happy.

2.  Getting or maintaining a repeat customer base.

We can view this from 2 different business viewpoints:  Operations and Marketing.  Here are 2 quick tips to kiss these fears goodbye, forever.

1.  Jump Start Your Operations

Your daily operations involve cleaning the line, ordering food, sweeping floors, rolling silverware, and stocking the bar.  These are things you rely on your staff for assistance.  Keeping them motivated, consistent, and happy is the heart of your business.

Daily operations also falls into the category of consistency.  Your food must be consistent.  I cannot stress the importance of this factor.  How would you feel about a restaurant where the food is hit or miss?  Would you constantly go back?

A lack of consistency brings bad reviews, kills motivation, and makes your staff unhappy for multiple reasons (lack of tips, constant server/kitchen bickering, complaining customers, over comp meals, etc).

It takes planning…

Without proper planning, your restaurant will fail.  You need to lay out ALL operations in written charts so every staff member understands their duties.  Structure the charts in the form of check lists.  Post them directly in your kitchen so they are highly visible for quick reference.  This should also include how-to pictures for line cooks.  Have your manager run down the check list before each staff member can clock out.   Nothing should be left for interpretation.

Planning = Success = Happiness

Yes.  Your staff will complain at first.  As humans, we drag our feet to make changes.  But once the new routine is learned, we all reap the benefits.  This begins with solid planning for daily operations.

On a side note, don’t be an a-hole to your staff.  In general, most restaurant workers have fun with their jobs.  Present the new operations manuals and standards in a fun way.  Help and reward them.

2.  Marketing is Dead, Sort Of…

From a traditional standpoint, yes…but successful marketing is not dead, just different.  The game has changed.

What is successful marketing?

You are a restaurant.  Your in the hospitality industry.

Since when did radio ads, tv commercials, billboards, or print ads demonstrate hospitality to your customers?  Talking to people is your business.  Traditional advertising helps promote awareness, but is it a successful marketing strategy?

No.

You need to engage your community.  Get local and focus on who lives in your city.  That is why the internet is a PERFECT platform for restaurant marketing.  Not to mention, traditional advertising is outrageously expensive.  Stop believing MORE ads = MORE customers.  Get out there and start actively building relationships!

What does it mean to “Engage the Community?”

By engage, I mean talk to them.  Get online where most of your consumers are.  Be active on local forums, Twitter, Facebook, blogs, etc.  This is branding from a hospitality standpoint.  Local restaurants survived for decades by engaging people in their small communities.  The internet has made that process simple.

Remember:  you are building a local community of die-hard patrons.  These patrons will assure the success of your business.  Actively meet them without shoving countless ads down their throats.

As restaurant owners/managers, what do you guys fear?  What are your concerns?  How do you handle Operations?  Marketing?  Leave your comments below!