Regional Success in Brand Scaling

And we also have Clinton Anderson, the CEO of Fourth, who will be moderating the discussion with Jason. Jason, how about I let you provide the audience some information about your background and you can likewise tell them a little bit about Chop Shop.

Thanks Christina. My name is Jason Morgan, CEO of Original Chop Shop. I've been doing this for about 9 years now. We bought the brand name in 2016three unitsand I have actually grown it to 26. Prior to this, I've spent the majority of my career in hospitality in some shape or type. After a quick stint of attempting to be an accountant for about a year and a half, I transitioned into casino property and operated in business financing.

I was the very first staff member there after private equity purchased the organization. Assisted grow that from 20 to 150 locations, took it public in 2014, and then left about a year and a half after going public to do this at Chop Shop. My hope is that we can reproduce the success we had at Zos, and we're off to a truly good start.

We're at the counter, we bring the food to the table. It is mainly protein bowlsabout 40 percent of the mix. We likewise do salads, sandwiches. The secret to the program is we have a beverage component also with fresh-squeezed juices and protein shakes. We do all stables, we do breakfast throughout the day.

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A little more complex than some of the walk-the-line ideas that are out there, but we think we've got something quite special. We're going to add another shop this year and at least 4 stores next year. So we will be 31 or two shops by the end of next year.

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I've been in this function for about six years. 4th, as many of you understand, is a leading supplier of software application options to the restaurant and hospitality industry. Our goal is to help our clients be successful in driving profitability and being efficientmanaging labor, handling stock, and basically supplying them with tools they require to provide their vision.

It's unusual to have business that are beloved and growing rapidly, that can repeat that success every year. Jason, among the factors I was so ecstatic to have you join our session is the success at Zos was remarkable. I've just met a handful of brands where there was such a strong customer affinity for the brand name.

When you talk to consumers about Chop Shop, they enjoy the place. And to be able to take what is a reasonably complex idea in terms of delivering a fantastic experience for the customer, and be able to grow that from a couple of shops to now north of 30 stores next yearit's incredible.

We're going to discuss how to scale a dining establishment business. Every restaurateur I ever speak with has imagine taking one shop, 2 stores, 5 shops, and turning it into something much biggerexpanding throughout the city, throughout the state, into multiple states, and eventually nationwide, even international reach. However it's difficult, specifically in today's environment.

It's not a simple time to drive profitability and development at the very same time. How do you scale it and make it successful? Second, beyond innovation, how do you scale terrific groups?

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The very first concern I have for you, Jasonlook, you've done this two times now in the restaurant industry. What has your experience been in terms of what it takes to truly drive success in expanding dining establishments?

We talked a bit before we started about LinkedIn, and I've got a post teed approximately follow this next week about what the playbook is likepoint by pointfor growing a business. To me, among the crucial things, and I feel really lucky, is that both brands I have actually been involved with are unique.

And there's nothing exactly like Chop Store in regards to what we're making with a big, diverse menu. A lot of brand names today are very singularly focused in regards to what they're offering from a food item. I seem like we started at an advantage with both brands by having something unique that filled a niche nobody else was doing.

A lot of it starts with the brand. Does your brand have something distinct that no one else is doing?

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The second thingI originated from a finance background, so a lot of my learnings are more finance and data-driven versus a lot of early startup restaurateurs who are imaginative types. They love the food, they built the menu, they developed the brand name. I probably could not do that from scratch. If you offered me something that has all those components in place, I can take it from there and put the playbook in place.

They do not know their breakeven sales. They do not comprehend how margin improves as sales increase. I've seen so lots of companies where the numbers just don't work.

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If you don't have those two things, you should not be building stores. Due to the fact that as I hear your description, you have actually highlighted 3 things: execution, brand name differentiation, and financial viability.

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Second, you require an engaging brand or unique principle that resonates with customers. And third, the mathematics has to work. If you do not understand your system economics, your fixed and variable costs, you may be broadening blind and losing cash. Exactly. And another crucial lesson is about entering new markets.

When we expanded to Dallas, I expected brand-new stores to do 5070% of Phoenix sales in the very first year. Too many operators assume brand-new markets will open at full volume day one.