February 13, 2014 |

Are you ready for a second location?

By Pizza Today


grand opening signBy Jeff Mease

As entrepreneurs, that next business that we create has the very real capacity to destroy everything we’ve worked for up to this point. At the very least, it can make our lives unpleasant for a while.

But it’s also the gateway to our dreams, a further expression of who we are in the world.

If you own a business that’s cranking it out, it’s easy to think that your second one will be easier than the first. I’ve opened 12 businesses across six different concepts, and I’m quite clear that my second location, my second concept and my second career have all been the most challenging. When I talk to other business people, I often hear the same thing.

My business currently includes a small chain of five pizza delivery and carry-out stores, a 130-seat casual dining restaurant, two breweries, an off-premise catering company, a central commissary and an organic farm that’s slowly developing into an agro-tourism destination. I started my first pizza shop at age 20 and the company has been going strong for 31 years now.

Each of our businesses is as unique and different as each of us. And so it should be. When it’s time to consider your next bite at the apple, here are a few items that I want you to think about:

  1.  How effective are my cost-control systems? Is it systems or people driving your cost control? Great people are great—and likely part of what has made them great is working shoulder to shoulder with you—but unless you can handle another full-time job in your spare time, come Number 2, there is going to be greater distance and more room for error between you and your key people.
  2. How accurate and timely is my internal financial reporting? Do you have systems in place to calculate key costs on a daily and weekly basis and create a monthly P&L within 2-3 weeks, comparing current data to previous and prior periods? I believe this structure is the backbone of any successful foodservice business. Budgets are great too, but to me, operating budgets (guesses) play second fiddle to the current reality and how those compare to last week’s and last year’s reality.
  3. How will my quality-control issues change with a second operation? In foodservice we all know that consistency is synonymous with quality. We went to a commissary system with Unit 2 and it was one of the smartest things we’ve ever done. And even though our first commissary remained in the back of our original store until we got to 4 units, we still operated it as a simple cost center, tracking costs separately from operations and “selling” prepped items like dough, sauce and veggies to our operating locations. Our commissary now has its own space and offers us economies of scale in addition to allowing us to understand exactly what every pound of sliced onions and 20 oz. dough ball costs us to produce.
  4. Is your team a team? How are incentives structured within your organization? What can you do to create a culture that fosters teamwork and a sense that you and your key people are all on the same side? The systems of slavery and feudalism were once as widely accepted as “wage slavery” was in the 20th century. Today, young people often come to us with little or no understanding of the role of profit in life and business. For any number or reasons, your staff may join your company with a bias AGAINST profit. It’s an unhealthy bias and it’s dangerous for your business. I believe that the future of organizations in our industry is in “open-book management.” Familiarize yourself with the concept and figure out how, as leader of your company, you can lead from a place of “we are all in this together.”

For a deeper and more colorful look at these concepts, please join me at Pizza Expo 2014. I’ll be making a presentation called “The Second Unit is the Hardest” on Wednesday and Thursday at 9am. I hope to see you there!

Jeff_MeaseJeff Mease is the founder and CEO of One World Enterprises in Bloomington, Ind. His company includes Pizza X, Lennie’s , Bloomington Brewing Co., One World Catering and Loesch Farm. He returns as a speaker at Pizza Expo 2014.

 

This Pizza Expo Exclusive is part of a continuing series leading up to the International Pizza Expo at the Las Vegas Convention Center on March 24-27, 2014. Seminar speakers and demonstrators will provide professional advice on their area of expertise.

CLICK HERE to read more Pizza Expo Exclusives.

To Learn more about International Pizza Expo, visit www.pizzaexpo.com.

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