Petersburg Case Study
From behind to out in front
In 2015, The Sandhu Group purchased a package of restaurants that had lacked investment and focus. These locations had aged physical assets, thin store-level management and a “protect what we have” mindset, rather than a focus on operational excellence. Where others saw a series of challenges, we saw an opportunity.
After visiting the locations, pre-acquisition, we knew there was an opportunity to drive top-line sales and profits. In our visits, we noticed that speed of service was not a focus. The locations also were not participating in programs to gather customer satisfaction metrics. This type of data is core to how we identify opportunities for improvement. Management bonus programs were inconsistent, which was a headwind towards aligning team performance to desired outcomes. Finally, labor targets were set artificially low, which meant that these locations were trying to manage costs through less labor and failing to strike a balance across food, labor and other performance metrics.
After acquisition, we got to work. We implemented systems to track customer satisfaction and processes to improve speed of service. We instituted consistent management bonus programs. We invested in remodeling and upgraded the existing equipment, which immediately reduced waste in our Cost of Goods Sold. The final step to re-balancing our targets included raising the amount of time managers were encouraged to spend with their teams and in store and raising cost of labor targets overall.
Within 6 months, revenue was +5%, while revenue across the entire brand was -5%. We were so proud. In a short period of time, not only did we improve these stores, but we outperformed the national average by 10 percentage points. In the longer-term, our revenue has continued to climb and our profitability has increased more than four times our revenue growth.
THE SECRET TO OUR SUCCESS WAS APPLYING THE PROVEN SYSTEMS AND STRUCTURES THAT HAVE DRIVEN OUR SUCCESS FOR DECADES:
