Rusty Bills:

Hi, my name is Rusty Bills. I’m the Chief Operating Officer of Galardi Group. So I got down to where they’re like, well, we can’t keep this business going. We’re going to have to lay you off. I got laid off. I had a mortgage. I had a six month old baby. And I’m just like, what am I going to do? But he came in and he wouldn’t talk to anybody. And it was really rude and disrespectful. And like, hey, I’m here. I’m the boss. This is how it’s going to go. If I’m ever in the position to oversee people, departments, I didn’t want to be like that. To this day, I walk into every restaurant just like, hey, my name’s  Rusty.

Like, I never go entitled. I don’t believe in that. One of the greatest things I’ve done this last year was I started a workout routine where I work out with a trainer every day. That thing has put me on a level of chipping away the insanity a lot. Not only the physicality of it, but the mental. So do you work for Wienerschnitzel? I’m like, yeah. And they’re like, well, which one? I’m like, well, all of them. And they’re like, well, how did you start? I’m like, I’ve worked in fast food. I started and I worked as a busboy and I worked a pizza shop. And you don’t just go here. There’s a path.

 

Ashish Tulsian: 

What would be your message for anybody who’s in their early 20s on looking at a career in the restaurant space?

 

Rusty Bills:

The restaurant world has so many different facets than it ever did before. So I think the consumer habits of restaurants are always going to be there. 

 

Ashish Tulsian: 

Hi, welcome to Restrocast. Today, my guest is Rusty Bills, COO, Galati Group, owners of Wienerschnitzel. Rusty’s journey from CPK to having a degree in criminal justice, to joining Galati Group, rising through the ranks in the last 18 years, and being somebody who’s not only an operator of the brand, but also boasts of, and proudly boasts of, great relationship with his franchisees is rare. But in this conversation, you will see the great perseverance and the empathy that Rusty carries and has built that trust with franchisees and their business over years. This is an inspiring watch. Welcome to Restrocast. Rusty, welcome to Restrocastt. 

 

Rusty Bills:

Thank you. Thank you for having me.

 

Ashish Tulsian: 

Thank you for agreeing to do this. You know, when we were talking about this podcast, we started off with my thesis that this industry, you know, nobody in their same state of mind comes in or continues. There’s definitely some level of, you know, insanity, not only that you love, you just get used to. Otherwise, you know, you get ejected out of this. How did it start for you? And take me through your early years. And how did you land in the restaurant industry?

 

Rusty Bills:

Wow. Well, as I am now, I’m the chief operating officer for Galardi Group, which is the parent company for Wiener Schnitzel, Hamburger Sand, Tasty Freeze. And it’s been quite the journey. I just had my 18 year anniversary on Saturday. So that’s kind of my career. Galardi Group has now turned to be an adult. So now my career can vote and, you know, go to war and all that stuff.

 

Ashish Tulsian: 

18 years.

 

Rusty Bills:

So it’s a passion. And it started at an early age. And I was been in restaurants since I was 15. My first job was a paperboy, but I got into a pizza business when I was 15, going to school and worked. And then, you know, went off to college and needed to pay my way through college. So I went to California Pizza Kitchen as a busboy and loved it. Then worked through the ranks all the way through school, paid it off. Went to busser, to server, to counter manager. Actually loved it. I loved the culture, the values of that company. The tips were great to help pay my way through college. You know, got a degree in criminal justice, of all things, which has no reason why it gets me in the restaurant business. No idea. But at the time, that was a good idea. You know, OJ was doing his thing and it was captivating the audiences.

1994. So I thought, yeah, I’m going to be a criminal profiler. And it didn’t go that way. You know, they needed like internships and freebies. And so I was like, I can’t do that. I need a job. So a buddy of mine got a job with, I graduated, got married right after graduating. And he had a job as a recruiter at a staffing agency. He’s like, man, you got to leave that restaurant. You got to come over here, man. It’s a real job. You know, it’s like 25 grand a year.

We got to do this. I’m like, all right, I’ll give it a shot. So I get my cheap suit at Macy’s and my wingtip shoes and had to be a recruiter for a staffing company. And I was like making calls, sitting at a desk. And I was recruiting forklift drivers and administrative assistants and warehouse help. And I just thought I can’t do that. It was a year in and I tried, tried my best. And I was just like, I’m not suited for this. Like literally the suit didn’t make sense. I wasn’t geared for that. And I’m like, there was something still calling me and it was the restaurant. And so I actually called the GM at the time and said, hey, do you still have a spot for me at CPK? I mean, here I am graduated, 24 years old or whatever. I go back there and work another couple of years. And then an opportunity knocked where someone took a chance on me to be a multi-unit guy.

Super grateful for that. I remember hanging out by a margarita machine at a wedding and he said, hey, I got a couple of companies that are looking for an operations guy. It’s like, okay, well, I’ve just been one restaurant. I haven’t had multi-unit anything, but they took a chance on me. And it was a company called Taco Del Mar that was up in the Pacific Northwest. Pretty strong, vibrant up there. And it’s like a master development agreement. So it’s kind of a unique in the franchise world. So they took a chance on me. I was very grateful for them. I mean, that’s something that’s like, I learned everything from training, construction, real estate, obviously operations, food. And he just let me learn from him. And I’m very appreciative.

 

Ashish Tulsian: 

But I’m going to interrupt here. While you were paying through your school through CPK and you still ended up doing a degree in criminal justice. Why was that happening? Was restaurant not the real job or the real career? Is that?

 

Rusty Bills:

Yeah, the restaurant, which I thought in college, it was my means to pay my way through school. I don’t have any parental support. And it was just my way of that was the card that I had. And I remember applying. It was a brand new store. So there was like 50 people applied to be a busboy. And I got to be one of the eight. So I’m like, this is cool. We’re a busboy. Then my wife became a hostess a couple of years later. We were already dating, but just became this thing. You’ve got your group of friends. Everyone had the same schedules. 

 

Ashish Tulsian: 

You met your wife at? 

 

Rusty Bills:

I actually met my wife in high school. Yeah, so she was a year older. She’s a junior. And I was a senior. And we started dating just mutual friends. And we’re both 17. So we both just turned 51. So it’s been pretty good. Awesome. Yeah, it’s 34 years. That’s extremely proud. When we married for almost 28. So we dated through high school, college. Um, it’s kind of a weird. The way it works is I was supposed to go to University of Arizona. And I got a partial scholarship.

Uh, I go to sign the paperwork in August and found out because I was born in Tucson. They thought I was a resident. So the paperwork changed when I got the tuition. I’m like, I can’t pay this. So now it’s out of state. And on the fly, I made a decision. It was the only thing I could do at the time. I’m like, I can’t afford this. I can’t. Because I was on my own. So it was just like, I’m coming back. And I’m just going to, so we kept dating. We didn’t know we’re going to stay together. So then because I was a year ahead of her, um, we just started dating. And then a buddy of mine plays football at Cal State University, Sacramento and says, why don’t you come here?

So then she followed. So it’s a, it’s a, it’s a little twist that that moment of somebody put speaking of driver’s license, you know, we’re talking, they thought, because I said my birth date, birth city was Tucson, Arizona, that I was in state. And then back then I forget the tuition. It’s definitely different now that I pay for one for my daughter, but, um, it was dramatically different from in-state to out. And, um, I’m grateful for that because probably wouldn’t have, you know, the family I have, the career. And it’s so weird. It’s a tipping point. It’s those, when I read about the outliers and tipping point, you’re like, wow, there’s something that happened that definitely put my life in a whole different trajectory. And so I think just working in the restaurant was a means to, um, kind of, you know, pay my way and have friends.

We, everyone connected together and, um, you know, I couldn’t go out on the weekends like everybody did. I was fine with that. It was just my, my situation, the circumstances, but yeah.

 

So when I left, I thought I was supposed to society tells you to get a job, get a real job, you know, because I think restaurants were given this, like, oh, this is, this is something anybody can do it. And I had a passion for it. I love a very competitive. I love being the server. They got the most tips. I took the most tables.

I wanted to get the most rewards. I wanted to get the best accolades and obviously the most money. And it’s, I’m driven. So I was like, this is a lot of, I’d say drive. I have started on the early days of the restaurants. And when you see leaders that you worked with, um, I had a chance to find people that I really enjoyed working with and were mentors. And also people that I was like, if I’m ever in charge, I never want to be like that person. So I’ve learned those lessons. Cause I think that’s the trajectory of life. You learn from moments that were great for you and moments that were not.

 

Ashish Tulsian: 

And what was, what was something that you felt very strongly was first time that you felt that the day I’m in the position of power, I’m not going to be.

 

Rusty Bills:

It was a regional director came in and he was doing his like half year. He was a corporate guy. He comes in and our GM was like, Hey, we’re getting our big inspection. Okay. But he came in and he wouldn’t talk to anybody. And it was really rude and disrespectful to any made people feel intimidated. And like, Hey, I’m here. I’m the boss. And this is how it’s going to go.

Um, never went out of his way to like, Hey, how you doing rusty? You know, thanks for being here. Things like that. Um, and it was, it was odd because I would say there was almost blemish free for other, every other experience. I had my 12 years working for California Pete’s kitchen. But I remember turning, I’m like, I was like a busser or server at the time.

I had no vision of where I was going to go. But I said, if I’m ever in the position to oversee people departments and, you know, help create a legacy, I didn’t want to be like that. I wanted to be the guy who to this day, I walk into every restaurant just like, Hey, Sally, how you doing? Nice to meet you. How long have you been here? My name is rusty. Like I never go in title. I don’t, I don’t believe in that. I don’t believe, I think your title is, is something that defines where you’re, you are within the company and the culture.

But I think to a crew member, who’s doing their best because I put myself in that same situation I was. So I’m able to like flip the script and say, look, I, you know, this person could just be paying for school support in the family. Why would I come in? Like I’m some sort of big shot. So it’s always a defining moment back in those early days. And I don’t know what triggered to, to go back. I felt like, I almost feel like restaurants were just like my destiny in a weird way. I know it sounds, you know, like what you said. I mean, it’s kind of insane. It is an insane industry to work in. And yet there’s so many people still doing it.

 

Ashish Tulsian: 

So when you were, and given that you were getting your, you know, your wife since 17. So that means when you decided to go back to the restaurant industry and she, you know, also experienced it, you know, part time. So was there, was there a conversation about that? This is, this is a mad industry and, you know, long hours and you’re not going to see light of the day literally at times. 

 

Rusty Bills:

Yeah. I think, you know, at that level, I was like the store manager, a bar manager at a great schedule work money through Friday from like nine to five. So I had a, a non-traditional schedule in the restaurant industry. And she was a hostess for a while. It worked sometimes it didn’t work because I was so hungry for business. I would say, Hey, I need more tables. I’m not going to show favoritism. And so it became this like little squabble. So we’d take it home. I’m like, don’t you want to help me get, she’s like, I don’t want to show favoritism. So just deal with the tables you get. So it was always a fun thing. And yeah, it, it, I think those early days of me working nights during college, it prepared us, you know, she has to, you know, that’s the thing that I think is a lot of people don’t realize in the restaurant industry, the spouses go through some chaos from not only the travel.

And when you got little kids, I mean, she’s the champ. She’s the, she’s the CEO of the household. It was like, I’m gone four or five, six, seven days at a time in chunks. And that was back when we had like five and six year olds, you know, it’s, and that job is crazy. Yeah. And definitely doesn’t get the do it gets. I get, I draw, I walk around, I have a title. So people like look up to me or something. I’m like, no, she’s the one that did it. You know, it’s like, it’s admirable because I sometimes get emotional. Sorry. But, um, I’m nowhere without her.

 

Ashish Tulsian: 

Yeah. Back to your career. So you are, you know, you got picked by Taco Del Mar, you know, who took a chance on you, took a shot on you and, you know, taught you the ropes of the trade. But how long did you work with them and what, what is it that you learned?

 

Rusty Bills:

So, uh, two and a half years in, um, master franchise agreement. So they start, we started expanding in Washington and then in California. I think that’s where it all went awry. This group, they’re from Washington. Seattle is the base of Taco Del Mar. So this, um, uh, master development group that hired me on is kind of a jack of all trades, even though I didn’t have many trades, but they got me going. So I opened up 31 stores in two years. It was mass product. I mean, they’re basically a subway. If you think of it’s 1200 square feet, it’s a food for you. They’re not, not a lot of equipment. It’s, it’s literally, it’s the way the food was. It’s kind of like subway. It’s literally just a microwavable food and stuff. And it just kind of didn’t hit well in California for obvious reasons.

California hits all authenticity with Mexican food, the regional chain, the local Taqueria, having a place like this was super Americanized that maybe survives in a certain region of the country. Um, so it got down to where they’re like, well, we can’t keep this business going. We’re going to have to lay you off. So I got laid off. I had a mortgage. I had a six month old, a six month old baby and eight, eight or nine months actually. Um, and I’m just like, what am I going to do? You know? And you know, it was my responsibility to figure it out. And career builder was still a thing back then. It was 19 years ago. And I just grinded.

I had three opportunities that all brought me in for interviews. Wienerschnitzel and two other brands, uh, Romex restaurants and Jamba Juice back when they were, uh, themselves. And, um, just evaluate. I had never been to Wienerschnitzel before in my life until I tell my mom and she’s like, oh no, you did son. When you were three in Tucson, we went to one on Oracle. So I’m like, okay. So it’s kind of cool to go see that location because I know my mom said I had a crowd dog or a mustard dog when I was three years old, uh, 

 

Ashish Tulsian:

How old are you? 

 

Rusty Bills:

61, uh, 64 years, 1961. Yeah. So, um, so basically I just had these interviews with different people, different companies, about a three month process. Me and my wife had a, this is before all the technology. So I had a dry erase board pros and cons of each brand. And just like, it is me and her going through it. Travel, money, experience, you know, the type of food Jamba Juice is forward thinking healthier. Wienerschnitzel was kind of its own like fast food and we went out to try it. And, um, then I looked at stability.

I’m like, this company has been around a long time. Um, they’re privately held, which usually means you’re not going to have the four or five, 6,000 units, like some of our competitors and other people, the people, uh, the people I interviewed with. And I just said, these, that’s what I want. I want culture. I want people. 

 

Ashish Tulsian:

What was, what, what, what stood out for you?

 

Rusty Bills:

I had, um, three different interviews and there was something about the care and concern and the longevity that they had. The people in the company had been there for a long time. And I think, um, there’s something really cool and unique about that. When a brand can sustain relationships that long without turning, turning it. Now you can also look at, maybe there’s some complacency there. There’s a different lens you can look at. But what I saw early on in those stages was, you know, um, uh, my boss had been there for 20 years. Um, uh, the, the next report was there for like 15 and, um, the president of the company had been there for 30. And so I was like, this is really cool. And they’re based out of Newport beach at the time. So I flew down and met with them. And then, you know, I got the job, uh, it’s like a three months training that I went through full restaurant training. And then, um, just hit the ground running. And I just remember, I was told by my supervisor and HR, this is a good company. If you want to stay, to stay loyal and be with for a good time, they’ll take care of you.

But if you want a rapidly expanding career ladder, this isn’t for you. So apparently that I signed those papers knowing that when I started, well, you’re four and a half comes in and I’m doing what I think is a great job. I’m area director for 40, 50 stores. Every time someone leaves the company gets fired, let go my hands up. I’ll take Utah. I’ll take Dallas. I was just the eager beaver. I mean, I was 33 at the time ready to go. And I think that resonated with the leadership team at the time. 

Um, but I just kind of reached out. I think I need to spread my wings. I think I’m capable of doing more than just doing an audit and helping a franchisee look at their business and walk the path of drive-through and say, pick up this, that it’s a very necessary job, but I thought I could do more. And so I just went back to HR and my supervisor, any opportunity for growth within the company? And they both said, and I hate saying this because one of them still works at the company. They’re all, well, no, you knew when you started that there weren’t going to be opportunities. So I said, okay. So I talked to my wife and I, we thought the best thing was to take a chance and go somewhere else. 

 

Ashish Tulsian:

Oh, wow. And that was four and a half years into the 

 

Rusty Bills: 

Four and a half years in. So I actually looked into another company and got a job proposal. And I sent a very professional, very professional letter that I, I regret, but I just felt like for me and my family, I thought I could do more. And not that I was being held back. I just, there weren’t opportunities created. So I was very professional. I know not to burn bridges. Of course, um, upon learning this, the leadership team was like, no, no, no. There’s something special in you.

And the president of the company at the time, which I didn’t know very well, because at that time it was an intimidation factor. He called me. He’s like, you know, Rusty, uh, I hear too many good things about you. The franchisees call me. They found out about this and they’re up in arms and everyone, we want to keep you like, really? They’re all, yeah. And these are two, I don’t, I don’t say it, but you know, franchisees who don’t really always see eye to eye, but they’re both fighting for me. I thought that was unique. ‘

 

Ashish Tulsioan:

That is amazing. 

 

Rusty Bills: 

Yeah. Not because I was like some easy pushover, but because I helped them move their business. Cause I see things in a different light and lens and I help educate them.

 

Ashish Tulsian: 

A hundred percent. And I think, I mean, you don’t need to play this down because, you know, I do understand this one thing that you were on the brand side, you were on the franchisor side. Right. So leave alone two franchisees fighting for you. Like not even one will care. 

Rusty Bills:

I know.

 

Ashish Tulsian: 

In general, like relationship of franchisee and franchisor, especially the teams. Is, you know, it may not be loggerheads, but it’s not the most important. 

 

Rusty Bills:

Sometimes it’s adversarial relationship because a franchisee signs an agreement. Sometimes they’re like, Oh yeah, that was back in the day. This is what I want to do. But I learned how to navigate. 

 

Ashish Tulsian: 

I’m saying that is amazing.

 

Rusty Bills: 

Yeah. I really respect and appreciate that because it made me realize, you know, I was actually making a difference. You know, you realize, cause you’re, you’re kind of torn when you work for a franchisor and you’re in the field, you’ve got a franchisee, you’re the tug of war, you’re in the middle because you do get a paycheck from somebody, but the paycheck is actually created by the franchisee and all the customers. So you’re kind of in this interesting teeter totter. And, um, I became so like driven to help franchisees, especially more importantly, the ones who understood that they’re buying a restaurant, a box. And their goal is to use the systems and tools that we create.

That’s why the franchise system is the greatest business that’s been created in the world. I believe, because it brings in the cultural diversity things. The people I work with the, from all over, um, immigrants who have come here to make a better life for themselves. They’re trusting this American brand is going to take them there. And it has, and to see that happen time and time again for, because we have franchisees, these same two guys I’m talking about have both been here for over 45 years on the brand. Oh, and they’re one of them’s the largest franchisee in the system and, um, very well respected. I’ve been, um, I’ve learned so much from him. I mean, that’s the thing I took is I learned from the franchisees. I’m no smarty pants.

I wanted to learn the principles from them. And then I networked with other people to gain extra knowledge. I always want to be surrounded by someone smarter than me. And so when I decided, they said, look, but you’re going to have to move to corporate office. We’ll create a new position. So they just created a new position for me. I thought that was honorable that a company would, yeah. Yeah, absolutely. And, uh, they just like, well, you’re very like you’re, you’re, you, you think differently. You read differently. You interpret our business model differently. So we’re gonna take you out of the field, but we want you to manage everything to do with our ice cream division. And then special projects. I just did a bunch of like analyzing menu board profitability units sold and, um, just did the best I could. And then I did that for two and a half years.

And I got moved into a director role where I had oversight and then territory of like Texas and Arizona and Northern California. And, and then, um, that just moved into a senior director role. And then, uh, it just kept going, you know, over the years, um, I just pushed the boundary.

So when I was first told, well, it’s a good company if you don’t want to move on. And then, um, there was a time I was very fortunate that we reflected back in a 12 year period. There were seven promotions in the company and five were me because I’m just like, I see a door and I either bust through it or climb over it. Um, and I get it that the societal instinct sometimes is if you’re told to stay put, you just stay put, but I always look at it. Well, what if I came back to you with a objectionable idea? Let’s think differently.

Just because a boss told me to do something doesn’t mean I wanted to do it. And I think that that’s kind of where I’ve grown and been trusted within the franchise community, um, within the corporate structure. Um, uh, we have a great leadership team. And when I was, so I became VP for about five years and I’ve been the CEO for almost three. Um, and I don’t take that lightly. You know, it’s, I love, I have all of supply chain training, all of operations and all the people that run the field, um, the R and D team, as well as construction and all the billionaire stores. And I, I know it’s a heavy lift, but I have the energy and the passion to like guide these people and people come to me for advice solutions. And I turn it back on them, take intelligent risks. I’m surrounded by amazing people that helps. Cause if I went to work in this crazy, insane industry, um, and I didn’t, wasn’t surrounded by good people who thought the same, not everyone has. I think my shortcoming is I expect people to have my passion. My wife tells me, you’re going to have to like reel that back your expectations. You are where you are because of things you’ve done. You can’t expect everyone to mimic that. I said, okay, you know, I get it.

 

Ashish Tulsian: 

Um, but over the years you’ve toned that down.

 

Rusty Bills:

Yeah. Well, I think my, I want to tone down my expectations. Like I get disappointed sometimes if someone doesn’t do what I think would have been the right decision from the get-go, but instead my patients had to like evolve to go, okay, you know, I trust the process. What can I do to help them? What did I learn along the way to, to push that? And, um, so I I’m lucky because I’m, I’ve never been the intimidated force to go ask the right question with the right person, whether it’s the president of our company or now J.R. Galarty is our CEO. Um, and he has been for three or four years. Um, his dad founded the company. So he trusts me like crazy. You know, it’s kind of like, Hey, here are the keys of the car. Just don’t break it. But he’s very smart, very intellectual, um, understands the business and was always willing to learn.

So the old regime had me tasked with helping him understand the business model of the profitability, the marketing, the operations and how our equipment works and the challenges that we have with supply chain and getting food and just distribution issues, you know, and it opened his eyes because he was very, very passionate about it. And that’s right there. That’s what keeps me, keeps me with them is him and, and several other people, but his vision of where he wants to go being privately held family. Those are key attributes I really like.

 

Ashish Tulsian: 

That’s what I want to double click on, right? Yeah. You started by saying that, you know, uh, it’s privately held. That means it’s never going to have 5,000, 6,000 stores, let’s say, you know, in a short period of time. And, um, vis-a-vis a private equity run or funded, you know, company, you also mentioned that that may also mean complacency or like just being slow and lack of opportunities. Do you really believe in that? Or are you just quoting what the general perception and notion is?

 

Rusty Bills:

I think I’m doing more of the general, like when, when someone says, uh, company access 4,000 locations, or we talk about, you know, equity funding, you know, get infused capital that helps you rapidly expand. You partner with franchisees and, you know, we all learned what the Burger King world was doing a couple years ago. I’m not saying that we can’t grow. We have a path to grow and we have a strong, you know, you have to invest into corporate overhead to kind of help push the envelope and move forward. It’s not, it’s, I think it’s just pretty standard in our industry that those who stay private will move maybe at a slower pace, more of a cautious pace versus having a board and people saying, okay, we need top line sales.

 

Ashish Tulsian: 

When you, when you, when you meet people in the industry at conferences or I’m sure all kinds of franchisee shows and industry, you know, especially the rapidly moving ones are more troubled. They’re not, they’re not the happiest souls. 

 

Rusty Bills:

Exactly.

 

Ashish Tulsian: 

Right. What do you feel about that?

 

Rusty Bills:

I also hear, you know, merging brands when all these things are happening and I have friends all over the QSR space. And I heard one recently that hasn’t gone well, you know, it’s the two California brands and they merged and one had just said, well, it’s just kind of changed a little bit of our culture. And I get it. I get the whole acquisition. I’m not saying anything’s off the table. I don’t, I talk to JR a lot about these things, but it’s, there’s nothing is like a closed door. I’m just saying what it helps in my situation being private is I get to report to one person who, who will trust the guidance of his leadership team. He trusts all of us. And what I mean there, it just kind of keeps it more simplified. I can make decisions on the fly. I need something done.

That’s going to change a procedure. I don’t have to go through all these silos. And I think, I think that that’s more of what, what I mean by that, because I have no, I mean, no complaint and district, I would never disrespect any other brand that public, private equity or otherwise it’s…

 

Ashish Tulsian: 

No, I hear you. I mean, I don’t mean that respecting or disrespecting, but I, from a business perspective, I think I’m also coming from the fact that I’m of the, of a very similar nature and opinion of what you’re telling me. That means, you know, slow and fast can be relative, but a steady good business where people who work inside the business feel fulfilled and happy every day. And you are, you can look your customers in the eye and not feel embarrassed and you’re working hard for that. And it takes time and good things always take time. Big and small is relative, right? A hundred billion dollar company looks at, you know, all this AI boom right now, looks at a $7 trillion company and feel small, right? So, so what’s big and small? Yeah, that’s quite right.

So my question is, you’re majorly from that direction that do you, do you feel more fortunate when you see your franchisees and I’m taking an assumption here that in your case, franchisees must be, you know, doing better in terms of, you know, their numbers, if not, if not, not great. Because with velocity, a lot of brands are just, you know, doing bad things with respect to promises.

 

Rusty Bills:

Yep. I think with us, we pride ourselves of being very pro-franchisee and I know someone, anyone would say that, but I don’t think that’s always the case. A lot of times you want gross sales, you want top line sales. That’s what makes a franchise engine move. But we want to be profitable, purposeful sales. And if they’re in doing so, it helps the franchisee make money. That’s a win for everybody. So the relationships we have are very critical. Having our advisory board to help, help us make, you know, very challenging and difficult decisions that impact profitability at times.

But when they see where we’re coming from, that we don’t want to be this drop the hammer. And of course we have to run a company and there’s legal consequences if you’re going to negatively impact the brand by doing something that’s not correct. And there’s a reason why we have a legal department. There’s a reason why you sign a franchise agreement. Those are the, you know, I’ve had to close some stores. Those are tough moments. But if it weren’t for the other franchisees, they appreciate that. They appreciate that someone who did wrong or did bad was held accountable. And I think it’s a good look. So it’s the franchise world is very tricky and intriguing. And like I said, I’m so respectful of these people who have taken a chance on America and taken a chance on this little humble, you know, hot dog shack, you know, from 1961 to I want to invest with them. Things have changed.

We pride ourselves on being better like profitability and some like food costs is lower than a lot of our competitors because we’re not in the burger world or sandwich world. But there’s still, it’s a challenge, you know, with construction costs. It’s off the charts these days. You know, your whole goal really is to get the equal AUV and equal construction costs. It’s like a base.

 

Ashish Tulsian: 

Have you also seen, how’s the franchisee profile evolved? And, you know, to make it a little more pointed, given that’s an old company, some of the franchisees you said are with a company for 45 years, right? I’m sure the second generation is also coming to the business. Signing up a new franchisee today, new age or people of 25, how difficult and different is it?

 

Rusty Bills:

It’s very challenging. It’s very challenging, not only because there’s so many more choices now. The best marketing for selling franchises is how our actual stores perform. I mean, that’s the number one. You can have a fancy salesperson who can say anything. I get involved with discovery days because I also want to tell them the hardships of a brand. And I do that to be transparent. I want to tell them the honesty about there’s going to be miserable days. You’re going to have challenges.

And I think my transparency with franchisees, I pride myself in carrying great relationships with them, even the challenging ones. When we have to have those challenging conversations about the brand, I pride myself. I think my strength is the relationship business of being honest. I’m very mellow. I never go hunt and scream and pound. I know there’s a style for that. And some people are good at that. It’s just not mine. And when they’re screaming at me, I say, hey, let’s just have a conversation. So where do we go wrong? What can I do for you? Or what did that guy do so wrong to you that you need me to fix?

So I think what it is, it’s a lot of education because we are getting non-restaurant experienced people into the restaurant world now. And I know there was a big push in that in the 70s and 80s, but now we’re having people who are successful in a different, like medical sales equipment. We took a chance on when other people are like, well, you know, doesn’t have any restaurant background. I’m like, yeah, but he’s so smart. He had such great ideas. Discovery took a chance on him. I asked him to take on a project and he took, you know, franchisee who was struggling. He bought three stores from him and then he built a brand new store and he’s so hungry. He sends me a text every day. Hey, thanks for this opportunity. I love it. I want to do more.

I want to do a keep giving to me. I love that. Then I have an individual, a couple that opened in Omaha, Nebraska, which is a different, the change for us because we’re Southwest brand from Texas, basically all through California, 73% in California, which it’s a whole different challenge with government regulations, but you know, they’re there, they run like an Airbnb business. So think about the difference from having a house that you’re stocking. I don’t want to act like I know what goes on Airbnb, but versus the challenges of a restaurant. So we go through this process of opening. I go meet with them the week before and I had dinner with them. I said, you know what? You both are going to need each other, but I’m going to tell you right now, it’s going to suck.

You’re going to hate it. You’re going to run out of food. Your equipment’s going to break. Your staff’s going to call in sick. But you’re going to sit back and laugh and look back at that because it’s all going to get better. And you’re going to go through this and we’re going to be with you along the way. So she was like, she was like, okay, I’m here, Rusty. And, but the husband was kind of like intimidated because he’s not used to that. So I’m like, if I just painted rainbows and butterflies, like, oh, just turn on your hot dog grill, turn fryer, hit that KDS, you’re going to be knocking people through. And it’s just not the reality of it. And, you know, things did happen here. We are, you know, a couple of months in and, um, but I think the preparation of setting people up for success and knowledge of what’s going to happen, that’s the uniqueness of new franchisees.

We have another great one in Boise, Idaho, who was, uh, in the roofing business, just doing roofs all over the country. And I’m like, why Wienersitzel? I always ask why Wienersitzel, why restaurants? Um, cause we have turned down some people who think, oh, well I’m, I’m retired. So it seems like something to do. I’m like, it’s not a hobby.

This, these are not a hobby. I mean, you’ve got government regulations. You’ve got, it’s not a side gig. It’s no, no, it’s, this is not a hustle. This is not a, Hey, look, look at this. I’m going to put this picture up there and we’re going to sell a bunch of hot dogs. There’s more to it. Um, and I take on that challenge. I like that. I like the, you know, cause we do need to expand. We need to expand to new areas. So we’re going to get a different customer, I mean, a different customer base, but we’re also going to get a different franchisee. So we’re, we’re working with people. Our sales team does a great job.

 

Ashish Tulsian: 

This is, but Rusty, this is hard work. And I’m, and I mean, you know, uh, by that, what I mean is signing a franchisee today who potentially may not be the operator and, or you don’t want them to be a real operator. You want them to be another enterprise within an enterprise, right?

So if you see young brands of the world today, their biggest business comes from companies who are billion dollar themselves running 3,500 locations, you know, within that. And the people that you’re talking about, right. They will add one store each. Exactly. You know, they may grow even if they grow four X in the next decade, that’ll be four stores for you. You know, how do you look at the other side?

 

Rusty Bills:

I think our goal is to hunt down the big whales, the people who want to add to their portfolios, um, existing multi-unit operators. Those are people we like to have conversations with because they already know the business and they’d be willing to. I think what we have to make sure we, we do is do proof of concept. The problem is we don’t have that big frame. And I, I talked to a lot of people. I mean, I know like, you know, we have 210 franchisees 

 

Ashish Tulsian: 

Wow

 

Rusty Bills:

out of 342 stores, 1.3 stores per franchisee. That’s crazy. So, and what I did, 

 

Ashish Tulsian: 

what a crazy number for relationships. 

 

Rusty Bills:

It’s, it’s, it’s, it’s insane. So that’s the, when you said insanity, I told my wife about that because I tell her all the time, I tell everyone that will listen. I’m like, what’s crazy about our sector is we’re managing 1.3 stores per franchisee. The average in the industry is eight, eight to one, you know, and, and I have friends at Jack in a box. They have 105 franchisees for 2,200 locations. So the relationships, they only have to talk to 105 people for 2,200 locations. We need to manage those. So the FBCs and the roles I deal with, this guy has one store and he wants us to change everything in the brand for his one store. But you get a guy who’s invested in 25, 30 stores. He doesn’t even need us. And I find that very fascinating. That’s the shift that we have to do. We have to get people that are willing to take on more.

We have to reduce that cost of entry for it’s the construction costs that are out of our control. Like we’ve, we’ve re-engineered scaled it down, but it’s still a 1,200 square foot building for a lot of money. And we have to tell them that we’re going to do well. And so we need those, those big guys who want to take us on. And I think that’s the best way for, for growth for us. It’s just kind of hard to find those because it is challenging in our world to communicate with that many people because they look at things like, this is my challenge at my store. We’re like, yeah, but we’re talking about a brand, you know, I have to manage all the stores and you’re talking about your one. Um, I, I did, uh, I forget the company that took on all the, the RBI (Restaurant Brands International), uh, the Carol’s group that had like a thousand locations. 

 

Ashish Tulsian: 

Yeah. 1,500. 

 

Rusty Bills:

And, um, I said, let me ask you how, how you guys were three times the size of my company. What’s your hierarchy? What’s your structure? So she listed off everything, all the C-suite, all this supply. And I’m like, what involvement do you get from RBI?

She’s all really nothing. So that’s a whole nother thing because I truly believe the franchise world is the best business model. There is those people come in knowing that when you have one store, you have to rely on the corporate, the franchise.

But when you are running your own business empire of 10, 15, 20, 50 stores, you’re not relying on anybody because you know, the reason why you subscribe to a franchise is the systems and tools you’ve got training.

 

Ashish Tulsian: 

The only analogy that I can give you there is that, um, you know, when you are like in the franchise business for a brand like yours, the corporate team is basically, and think of it like an, you’re an outsourced operator for an entrepreneur or an investor. When you become somebody like RBI or Yum Brands, you at the corporate is just a consultant to somebody else’s business. 

 

Rusty Bills:

Yeah. We’re kind of like nudging them to stay inside the lines.

 

Ashish Tulsian: 

Yeah. RBI and Yum, you know, these, these, uh, these companies are actually consulting companies and the business of the restaurant is actually off the franchisee. In your case, business of the restaurant is your business and your franchisee is your customer or your investor.

 

Rusty Bills:

It definitely creates more heartache than others. And when people think, well, you guys are so small compared to all the big guys. Well, yeah, but when you look at the relationships we have to have and the nuances of different people from, um, geographic differences, the cultural differences, uh, it’s, it’s hard because you have to like teach your FPCs how to communicate differently that this, these people have a different way of doing the business.

But when you get the big companies, they’re like, Hey, we’re, we’re in it to win it. We don’t have to think about hotdog sourcing. You guys already do that. We never, we negotiate all the contracts and that’s the proof of a franchise business that shows that, Hey, you got a team of people that are striving and working hard for you. Uh, I’m really proud of our teams, what we do for the franchisees and, um, from our marketing team, you know, I’ve been fortunate that our CMO and I have gotten really close and it’s usually not the case. I mean, that’s just in the QSR space.

It’s usually a rub in the road between marketing. Um, yeah, we, we’ve, we’ve, we’ve always wanted to maintain, we, we praise publicly and we criticize privately because I think we don’t have to have our, our teams and we say, Hey, I totally disagree with that promotion. We shouldn’t be doing that stupid. That doesn’t look good. It’s kind of like parenting. So we’ve done a good job managing it so much. So we just had our conference in Kauai back in September, we decided to do a joint presentation. And so we were both on stage for two hours, just going back and forth. We made it silly.

We made it fun, very educational. The slides could, because you realize nowadays, because like I said about the technology, um, the tech marketing and ops are almost one United front now where there used to be these silos of different information. Um, now they flow together and, you know, him and I, for a small company, we don’t have tons of overhead. So me and the CMO, we negotiated contracts. I did everything with DoorDash and Uber, uh, Olo. Uh, we have since hired someone to kind of navigate all that because it’s a, we’ve got other things to do and, but we want to always be involved with the launch of something big.

 

Ashish Tulsian: 

Do you have a technology leader?

 

Rusty Bills:

Uh, yeah. Yeah. We have a vice president of technology.

 

Ashish Tulsian: 

And, um, how has, you know, his or her role changed or evolved, especially after COVID?

 

Rusty Bills:

It’s really challenging. Um, uh, Mohammed is our, uh, VP and I work very closely with him. Uh, he’s a champion. He’s got contacts out in the industry. We work on everything together that we have, you know, only a small staff in there, but a couple have to manage the, the help desk issues at store level. So we’re going cloud-based and, uh, that takes some hiccups and hurdles. We’re about halfway done. So that takes a lot of time.

Then there’s emerging technology of whether it’s customer sentiment or integrating inventory management all these things are technology APIs. You’ve got an integration. I mean, I’m speaking your language. So, you know, it’s like, I always say we do, so we do all the calls together. I’m like, Hey, you make all the fun nerd stuff. If he agrees to it, I’ll do the contract. You know, like I want to make sure he, him and his team are good. Um, and then I said, I’ll do the heavy lift. I’ll sign everything.

I want to make sure everything’s polished, but I want to make sure everything flows technologically. I never want to bring something onto the brand. That’s going to create havoc for our it team, just because it is almost at the forefront of the industries now in, in, in the restaurant space. And it’s fascinating how, um, from getting a little software, I jumped on board with one of the companies to have my FPCs do reports on and take pictures and get data and do that to the customer sentiment from SMG we’ve partnered with for years. Um, everything is, is different. I think some of the team is overwhelmed by all the new technologies coming in and, um, it’s hard to like, just slow down.

Cause again, I think for a small franchise or I feel comfortable and confident that I get to do more in my role than probably a lot of people do because they’re, they have more siloed or more people, but I also love having my hands on everything. So I’m kind of like this hungry hippo. I just want to know a little bit of everything. And I know one of my biggest weaknesses, I need to learn to delegate more, but also like want to be in the know. So it’s, I’m at a crossroads personally, but my wife says that’s my, she, she understands. Okay. I always want to be in the know, but I, for my stress management, I have to be able to delegate. Plus it helps elevate my employees too.

 

Ashish Tulsian: 

And what do you do for, you know, self growth for your own learning?

 

Rusty Bills:

Um, I do a lot of learning with podcasts on the way to, um, maybe this will be part of my routine going to work and the gym. Um, I think one of the greatest things I’ve done this last year was I started a workout routine where I work out with a trainer every day. So it’s weird that when you say development, I think that thing has put me on a level of chipping away the insanity a lot, not only the physicality of it, but the mental it’s, it’s an hour of the day where I’m not thinking about anything, but having to do this damn thing with this thing that I don’t want to do, but I haven’t done there. Um, but I try to stay on top of all, all the, the, the industry insights. I think, uh, 

 

Ashish Tulsian:

How do you do that? 

 

Rusty Bills:

Uh, just magazine articles coming through, just little snippets. Uh, one of the, one of the cool things we do though, um, Mark Hatch of Informa who was running like the RLC events and some of those come up with these nest calls. So he’s collaborated with, there’s 34 people in a COO nest call and we get together from all walks of restaurants once a month. 

 

Ashish Tulsian:

Oh, wow. And what is that? 

 

Rusty Bills:

So, um, he came up to me in Miami and said, Hey, would you like to, I’m thinking about doing this. I’m going to do it for each segment. So there’s a CEO group, a CTO group, um, a CMO group and COOs. I said, I would love that because I hunt and pack and try to talk to anybody. Well, what’s your business? What are some of your hardships? How have you navigated this? You know, I go back to when I first started, I told you that story about how it got to be leadership.

I did it by being an eager beaver. I always wanted to know. I always want to know someone smarter than me. Someone who’s got a bigger company. How did you handle X? So pre COVID I remember having dinner with a couple of directors of another fast food company. And I was asking simple questions about food costs, labor management, and then it was like, I don’t want to talk, you know, it was like tight to your vest, you know, sales and transactional data. I’m thinking, oh, okay, well, I’ll tell you mine. If you tell me yours, you know, so it became this like secret well, COVID COVID obviously flipped the script.

It really, the, the, the, all the old playbooks just got ripped out. And from, from a sales perspective, obviously it’s the greatest two years we’ve ever had in the history. Um, from, from all facets drive-through was essential. Um, 73% of our brands in California, I mean, a third of our brand doesn’t have a dining room. So like closing dining rooms didn’t have an adverse effect. More people can’t throw a drive drive-thrus. So I think everyone was trying to figure out what’s going on. Where are you at? Where’s where’s the benchmarking.

So, um, when this came about, I had gone to RLC, I was on a panel talking. So some people approached me and, uh, loved what I had to say and wanted to get together. So we had this networking lunch one time, and then it came out about a year ago in Miami for the global leadership conference. And he just approached me. So you want me to put you in that? You want me to put anybody else? I’m like, yeah, put my CEO and CMO in these groups. Um, it’s been awesome for all of us. We love it. So every month we have a zoom call. You’re not going to get all 34. Everyone’s busy, but you’ll get 18 to 22. Um, we’re having our first in person meeting at the RLC in Scottsdale. And what it is is I’ve got people from like white castle blaze mod, um, from, uh, Freddie’s from, uh, Hooters and red lobster. You got a bunch of bunch of guys and girls from really small regional brands. I don’t know much about, uh, to some of the upstart, the bigger ones. And then, um, uh, it’s just great information sharing. And he basically goes around.

Everyone introduced themselves, gives their little story. And then it’s like, Hey, what’s everyone’s tech. And we talked more about technology than anything. What’s your tech stack for hiring? What’s your tech stack for integration for customer sentiment. So then we’ll say, okay, so we start name dropping and it’s never, it’s never disrespectful, but someone will say, Oh, well, Hey, why don’t you reach out to me offline? I’ll tell you my experience with company X. Someone will say, Oh, you know what? I, I did work with them. Um, here’s where it went with me, but it might be different for you guys. Uh, I did it for a company who’s trying to do voice AI for me. I personally wasn’t thinking that they were ready the way Presto was, but they’re great at call center stuff and taking calls. And so I referred them to the Red Lobster team. You know, they’re, they switched their, their, uh, C-suite. And I said, they might be great for you. I think that’s the generosity of what this industry and this camaraderie, the fraternity sorority of it is, is sharing great things about great people.

I love that statement. Pain unites. But Misery Loves Kindness, it’s the old adage, you know, because you’re always chasing something. And it’s a competitive landscape. We do sales year over year, week over week. Everyone’s doing the same thing. And when we’re struggling, you know, I feel good to reach out to some of my sidekicks and say, hey, how are you guys feeling these days? Oh, we’re doing okay. Or we’re struggling here or there. Or, you know, Jack in the Box has asked me how we’re so successful in Texas and they can’t, they don’t perform that well. And I’m like, well, we also don’t go in the big behemoths. We’re not trying to get into Dallas and Houston, but they do.

So they’re chasing up a big competitor in Whataburger. We’re not. So I’m like, no, I help people understand where their challenges are. And I think it’s, it’s been very helpful to get to know these people and see what they do. We also do a good job of camaraderie. We visit each other’s restaurants and give in silent feedback. I’ll say, hey, man, I went to, I was at my daughter’s soccer tournament in Tucson and I went to one of your restaurants and the service was amazing and the food is great. What a great concept. Kudos to you and your team.

He’s, oh, thanks, Rusty. I really appreciate that. Or he’s got a new design firm to do the interiors of our restaurants. And they use an example of two of the brands. And so I reached out to him, Hey, what’s your experience? And that I had to tell my design team who’s new that those are both chains are not franchised. So a chain can operate differently than the franchise world. And that’s, that’s that whole dynamic we talked about versus a chain and franchisees getting buy-in, you know, to do certain things.

 

Ashish Tulsian: 

And what about the young generation given, you know, industry is quite demanding and it’s brutal. And I think the current gen, you know, Gen Z definitely is not tuned in, you know, for long hours. There was a whole lot of debate on work-life balance, which is also not getting anywhere now, but but then there was a debate and, you know, kids believe in that. I found actually people who are stuck between millennials and Gen Z believe in that. So what’s, what is your, what are your two cents on what’s happening?

 

Rusty Bills:

Well, I think, I think the COVID had a lot to do with the world conditions, economic conditions, but also the human element. I think the level of work commitment has changed. I think, you know, I’m that old guy now saying, look, I’m 51, you know, back in my day, I had an amazing work ethic because I had a mom to, to, to model that after where I think that there’s still people have good hardworking parents, but back then it was just brought up different.

You know, I didn’t have a father in my life. He left early on. And, um, but my mom had to work two jobs to support us. And I was just like, admired the work ethic. So when I started working on it, it was just my routine society. I’m just going to work my butt off and I’m not going to complain. And I’m going to work for every dollar I have. But now I think something has switched and I don’t know what it is, but I’ve worked really hard with my daughters and they’re not like that, which is good. I think they’ve seen my lifestyle. They’ve seen what’s gotten here that they both grind, they work and they do what they can from volunteer to working. There’s no complaining. Um, I am a huge believer. I think everyone should work in a restaurant business in some capacity.

 

Ashish Tulsian: 

Yeah.

 

Rusty Bills:

I mean, I just feel like I’ve under, I told you the other day, my daughter worked for Starbucks and Cava and learned so much of it. And I think kind of like what I started earlier when I said, you know, you learn a lot about leaders, the things you like from them, the things you don’t. I think you learn a lot about humanity, the things you liked and the things you don’t. When you, when you’re on the other side of the counter, imagine taking the order. And so I think there’s a lot.

A lot of complaining about how complacent, you know, and customers are on pins and needles now, they’re more argumentative, but sometimes I try to listen. You don’t know what they’re going through that moment. You never know what someone’s going through.

So when they yell at you, the barista at Starbucks, they never should do that, but they may have just had a death in the family. They may have had, and I’m always that eternal optimist, like, well, what if this happened? Or, you know, just like when someone drives crazy on the freeway and my wife’s like screaming, I’m like, hey, you know what? Maybe they have an emergency. So you’re just so like positive about everything. I’m like, well, what’s the alternative? You know, so I’m always like… 

Ashish Tulsian: 

There’s a word for this, toxic positivity. 

 

Rusty Bills: 

Yeah, so it’s, I think that the environment of the workforce right now, it’s, we do a good job in America, generalizing and stereotyping groups. And I know the millennials are the largest group that this country’s ever seen. Gen Z comes in this lazy attitude. I think there’s definitely some of that where they don’t want to work as much. Us coming across this environment, the collision at the same time with the labor that happened in California at 20 bucks an hour, we feel like we were discriminated against as a group. We fought. I went to the state capitol and fought with senators, with other restaurateurs to say, this is unfair that they filled out this bill that said if you have 60 units and you do front counter service, then you have to pay your employees 20 bucks an hour.

 

Ashish Tulsian: 

Like, what about the dude who’s washing dishes at Denny’s? 

 

Rusty Bills: 

He’s only worth 16? So I’d never understood that logic or how that even passed. So then you have these crossroads where we thought the franchisees went ballistic. So we’re like, hey, we’re doing our best. We’re going to see what we can do. So technology has helped. A lot of stuff with Presto was to help combat that. A lot of things we can do to reduce inventory management time helps offset. So I’m doing those things on our jobs, but it’s also, they’re saying, I thought maybe, because I’m an internal positive, I stood up at regional meetings. I’m like, hey, now we have a chance to grab better employees. Because now you’re, there was that shift.

You’ve got people going from full service that shifted over because why, how does a customer or employee know that I work at this mom and pop that only has five restaurants and I make 16 bucks an hour, but I can go to that national chain that happens to have 60 restaurants. I make 20 bucks. It’s maddening to me. I get state to state, but minimum wage in the same industry. And I think that was the disappointment. People felt like raising the minimum wage just gave them more money and took money out of the profits of the restaurants, but it didn’t gain a $20 person. It gained a minimum wage employee. So that’s what we’ve seen. When I collectively look at the data I’ve done, I’ve seen all the research too.

And it’s all been stated that you weren’t getting, what you’re doing is raising payroll tax workman’s comp, lowering profits dramatically. I was really hopeful that it would create this desirable employee that wanted to go above and beyond. But again, that 20 bucks is what their basic cost of entry is. Whereas my early upbringing, I wanted to do better to outgain that minimum. I wanted to be better. I wanted to be, I wanted to work hard to have that work ethic that you can do more. Now you can just fill out an application and get 20 bucks an hour. And I’m not saying that’s, I know inflation’s, I know it’s not great money to live on. What I mean is getting back to the..

 

Ashish Tulsian: 

I mean, it has to suit business economics as well. Otherwise business will not remain in business. 

 

Rusty Bills:

Exactly. And I think it’s just because, well then, you know, the collateral damage is everyone has to raise prices. So you raise prices and the customers complain that it’s $14 for a common meal at a QSR. You’re like, well, yeah, you have to, you know,

 

Ashish Tulsian: 

I mean, people are complaining and talking about tech size dropping, you know, so is the walk-ins.

 

Rusty Bills:

Yeah. And well, you lose transactions immediately. We knew that. We’re losing drink incidents and treat incidents because now people have to eat, but they’re paying 14 bucks. They paid 14 bucks three years ago, but they also had a drink. They also had a dessert. So now those things are going away.

 

Ashish Tulsian: 

You see that happening? 

 

Rusty Bills:

Yeah. We see, we see it. It used to be about 4.9 items per order. And now it’s like 4.2. People are peeling something off. Something’s coming away from the order. That’s from all the data people, business intelligence tools. Yeah.

 

Ashish Tulsian: 

That’s a 10, 15% down.

 

Rusty Bills:

Yeah. So you’re losing, people have to make decisions and obviously inflation came at a bad time. But it’s all, it’s all the stuff that gives us a headache because those are things that we can’t control. And I have to bring it down. When I go on stage and talk to my team and franchisees, we got to knock out the noise because everyone wants to talk about the noise. The noise is going to be moving. It’s going to be static all the time. Let’s focus on the things we can control. And that’s sometimes…

 

Ashish Tulsian: 

Also, it’s happening with everyone. It’s like it’s happening with you.

 

Rusty Bills:

Oh, totally. That’s the pain.

 

Ashish Tulsian: 

The beauty of the world is that it’s, it auto-connects.

 

Rusty Bills:

Yeah.

 

Ashish Tulsian: 

You know, especially if it’s happening with everyone.

 

Rusty Bills:

Yeah.

 

Ashish Tulsian: 

You know, that was my hope in COVID. Yeah. You know, whenever I was confused that what’s happening, I was like, well, it’s happening with everyone. So yeah.

 

Rusty Bills:

That’s that pain. That’s that misery less company. And I think that’s intuitive to say, you know what we got to do? We got to win these customers over. We got to treat them fairly friendly. We got to be fast and efficient. We got to have hot food and, um, let’s just continue to do that. So when, when they don’t do that, when they complain about, you know, cost rising and yet they get customer complaints about how they’re at, we’re like, we’re missing something there. And I think that’s the biggest challenge that nobody has a fix. I know there’s certain brands that thrive and really appealing. The ones that are the halo brands that we all strive to be like, they get the easy things, right. All the time.

 

Ashish Tulsian: 

Um, what would be your message for anybody who’s in their early twenties and are looking at a career, the real job career in the restaurant space as an operator?

 

Rusty Bills:

Well, I think when I look back, I would say that, uh, the restaurant career restaurant world has so many different facets than it ever did before. Um, I think you’re a living example of, with your knowledge and your, your tech involvement, um, it may have never been inspired to work in a restaurant space. You probably did some stuff in early days that were like for, you know, some other companies. Um, so I think the consumer habits of restaurants are always going to be there because for example, when my daughter was trying to figure out what to do for school, I said, things are always going to happen. Crime. That’s why I did criminal justice.

I felt like crime’s always going to exist. And that’s all facets from judge, jury, lawyers, police, corrections, all that stuff. Then you have healthcare. Healthcare is always going to be needed in some capacity. So she’s going to nursing school. Um, and then food, food’s not going to go away and food is going to be brought to you in a different way.

You’re going to pick it up. You’re going to have different channels of absorbing the food or getting it. There’s always going to be this noise of what’s healthy and what’s not. And everything on TV and your marketability tells you it’s got to be organic. It’s got to be gluten-free and all this. But if that were the case, then certain brands wouldn’t even exist. Humans, Americans are creative. They choose what they want, but they’re told these separate messages. And the subway story was that they did the, it’s the eat, eat fresh, but then people come in and go, Oh, actually I want the double pastrami.

But so marketing works to bring them in. But if they get something else, um, I think it’s knowing that there’s so many different ways that you can work in the restaurant space and not be a cashier or, uh, a cook or, um, being in, um, uh, cleaning dining rooms. Those are critical. Uh, but there’s so many other avenues that they can take now. And I’m, I’m honored that we, we worked with the California restaurant association. So I get to go talk to high schools and students and talk about the growth of busboy to COO.

 

Ashish Tulsian:

You love?

 

Rusty Bills: 

Yeah. I love it. Cause people think, so do you work for Wienerschnitzel? I’m like, yeah. And they’re like, well, which one? I’m like, well, all of them. And they’re like, what do you mean? Like regionally? I’m like, no, I, I, I oversee the brand. And they’re like, well, how did you start? I’m like, I’ve worked in fast food. I started and I worked, uh, as a busboy and I worked a pizza shop. And, um, you don’t just go here. There’s a path. I think sometimes everyone thinks everyone wants everything to happen right now.

Um, so I got to fill out that journey on a, on a piece of paper to a group of students. And it was kind of cool. Cause you get to see little things that you can try to like tackle and do. And I go, your life circumstances might be different, but, um, mine, we’re all attributed to why I am where I am. And I think we all have that, but sometimes you get that nuclear perfect family, maybe no tragedy, no hiccups. You’re kind of like thrown out to the world. Now what? But I didn’t, you know, I, I got dealt a more, I think, critical, important role of having, you know, kind of a disrupted family and, you know, not having a father figure in my except for coaches and, you know, uh, former bosses. Um, but I, I think that people should realize that food is here to stay and there’s so many different channels that it’s being disrupted by.

 

Ashish Tulsian: 

That is, that is so awesome and wholesome that, uh, you’re pro restaurant career and you’re doing a bit to inspire 20 year olds or 11 younger, uh, telling them that there’s a, there’s a path.

 

Rusty Bills:

I think there’s a stereotype too. I think there’s a stereotype about restaurants. Restaurants are easy. Uh, we went through that phase back in the, uh, early two thousands before the economic crash of the housing market, but people were getting home equity, lands of credit, taking money out and buying a subway or buying a taco tomorrow or buying these small QSRs, 250 grand. Oh, this is easy. And they’re a teacher.

They were doing something else and they can’t even do a subway because they just, your, your mind comes in as if it’s so basic to this day. One of the challenges we have with these big investor type guys is your time is valuable. So say you said, Hey, I’ve got a group of people I want to invest X amount of dollars, your company. And we’re like, well, you know, we need you to go into training. You’re like, I can’t go. I’m going to have, I’m going to have AJ to do it, you know? And so you put him through eight weeks of training and they come back and they fight us on that. Well, why can’t it be five? Well, look, we are setting you up for success and more training is always better.

You’re never going to have enough training in life, but it’s this short term necessity of like, well, I gotta pay for housing. I gotta pay for this. He’s going to be over there. I’m like, it’s going to be worth it in the long haul. So we’ve had to set up a, what we call investor training. So for the, the, the guys who do that, where they’re, um, excuse me. So we did an Arkansas 20 store deal and, uh, the, the main investor had to go through two weeks of business one-on-one and get behind the counter and learn how to make a chili dog. And so they understood the capabilities of it. The, the challenge of the investor world is that we had a store, um, in Colorado Springs. They did not, we created because of this. They hired a manager who was not on the franchise agreement who came in and then during training just quit. So now the restaurant’s brand new and no one knew how to run it.

 

Ashish Tulsian: 

Oh, wow.

 

Rusty Bills:

So we started a new campaign. So they, they ended up going through training. We, we shipped someone there, helped them, but it just tells you, you learn from mistakes and we’re like, you know, you don’t own that person. They’re, they’re a free agent, right? And a general manager, they can go work for anybody. So it just changed the way we do it because I think people want a shortcut. And I think that’s one of the best lessons I like to tell people is that there’s no real shortcuts to learning things correctly.

 

Ashish Tulsian: 

Um, and you need to go get down dirty in the trenches. Yeah. Otherwise, most of your knowledge will remain academic and that’s not going to solve the problem.

 

Rusty Bills:

You know, I love that. When I started the training, when I was 31 years old, I was scrubbing toilets, scrubbing the thing, making chili at 6am, doing everything that, uh, Aggie, one of my all-time favorite ladies in the business, she’s been there for like 45 years. She’s amazing. Um, she taught me that stuff. She reminded me of my mom, um, just hard work, dedication. You don’t get to come in for a free pass just because I’m not going to, I always, my philosophy, which I think a lot of people have, I’m not going to expect someone to do something I don’t know how to do.

I know how to do all facets of our, of our restaurant. Maybe not someone else’s, but it’s, it’s imperative. It’s also a trust thing. I think people know when I’m talking or when I’m in their restaurant, I know how to do it and I’ll, I’ll fill in and I’ll, I’ll the, the headset and the computer that, that you don’t, it’s a repetitious thing. So little Sally there, she should knock out a drive-thru where I’m like, uh, where do we add fries again? You know, but making the food, doing everything.

I think it’s a respect thing that people find, uh, important. So I always tell my team like, Hey, go in there, show them, but also your knowledge is critical. So they, they can work in a line of partner. We always call it like shoulder to shoulder. You know, if you get into a restaurant and there’s short staff and things are in crazy, don’t do an audit, drop that stuff down, get on there, make them feel the lunch rush and then sit down and talk to them about, is this a, is this an ongoing thing or is this a one-time deal? But our threat should not be to go and to just kick them when they’re down, you know, then you get this adversarial relationship of, Oh, you guys are the bad guys or the cops. So that’s, yeah.

 

Ashish Tulsian: 

That is absolutely phenomenal. And Rusty, I can, I can hear that, uh, people who are working with you on your teams or who are under your mentorship. Um, I’m sure it’s a privilege that they’re working with a leader who, uh, believes in getting, you know, hands on with, with stuff that you’re supposed to do. Uh, thank you for being on the pod. 

 

Rusty Bills:

Absolutely. Thanks for having me.

 

Ashish Tulsian: 

Absolutely enriching conversation. Good.

 

Rusty Bills:

Thank you very much. I really appreciate it. This is awesome.