Cameron Mitchell Discusses the Restaurant Business (Podcast)

I found our conversation quite fascinating if you're interested in the restaurant industry and what it's like to develop a restaurant concept and expand it from one restaurant too many across the country. Uh. They have five thousand employees and their restaurants of a variety of different names, probably best known as Ocean Prime Um, generate over three hundred million dollars a year and revenue. Uh. You'll find this to be a fascinating conversation. So, with no further ado, my

conversation Cameron Mitchell. My special guest today is Cameron Mitchell. He is the founder of the Cameron Mitchell Restaurant Group, now twenty five years old and employing five thousand people in sixty restaurants across the country. Cameron Mitchell restaurant group

generates over three hundred million dollars in annual sales. Mr. Mitchell was named Entrepreneur of the Year by Ernst and Young, as well as Small Business Person of the Year by the U s. S b A. He was also named to fifty New Tastemakers by the Nation's Restaurant News magazine, and he is the author, most recently of Yes Is the Answer. How faith in people and a culture of hospitality built a modern American restaurant company. Cameron Mitchell, Welcome

to Bloomberg. Thank you very much. Pleasure to be here. So let's let's discuss a little bit about your background. You didn't seem when you were growing up like somebody who was going to find his way into a chef's talk. How did you get interested in restaurants and cooking? It doesn't appear this is something you were very passionate about as a child. Now, I it depends on how far

back you want to go. But I had a troubled childhood into troubled youth, and struggled in high school and ran away from my home and dropped out of high school when I was fifteen, and my folks were divorced and my mom didn't have any money. And so when I came back would have been my junior year, I didn't have any money for lunch money, and she couldn't give me lunch money. And I needed to work. I

need to get a job. And so I got a job in es a local local steakhouse Washington dishes for two sixty hour and did that in bus tables and prepped a little bit through my junior and senior year in high school. And that's how I found my entree into the restaurant business. So, so let's talk about that, because you described in your book sort of being a terrible employee, constantly being late. You were suspended, you put on thirty days notice, and you describe an epiphany where

you realized, Hey, this restaurant thing is really interesting. What explained what that moment was like and how it changed your whole life. Well, I was just turned ninety at

the time. I've been out in high school for about a year, and I was living at home with mom, working for beer money, working for the man, not uh boy, but not yet a man, and um, just really squandering and UM I was working two jobs in the restaurant business, and I had trouble getting to work on time in the morning, and I got put on three days suspension in thirty days probation. So midway through that probationary period, and I'm just trying to fare what I want to

do in my life. And then I just have been struggling, and so I don't want to go right after college because I don't want to go to college not knowing what I wanted to do. So UM, I have suspended for three days, put on thirty days probation. And during the middle of that probationary period, it was a Friday afternoon and I was during shift changed, and I was working AM cook that day and a PM host at

the same restaurant. Yes, and that restaurant was a very busy restaurant, would probably do a thousand people that day between lunch and dinner. And UM, four o'clock in the afternoon shift change the restaurant, the restaurant's half full, the bar is packed with happy are uh. The AM shift was trying to leave, the PM shifts trying to come on. The managers are barking orders, and it's kind of pandemonium

in the kitchen, and time froze. I looked across the line in the kitchen and I said, I absolutely love this. This is what I'm going to do the rest of my life. I'm going to be in the restaurant business. So I worked my double shift and I went home that night and I wrote out my goals. I said, I was going to go to the culinary. It's two of America in Hyde Park, New York. I had heard about that. I'm nineteen years old, and I was gonna graduate.

I was gonna become executive chef by the time I was twenty three, general manager of twenty four, regional manager twenty six, vice president oper as a thirty, and president of a restaurant company by the time I was thirty five. Those are those are ambitious. And I woke my mom up at one in the morning, so I know what I want to do with myself the rest of my life. And she was quite relieved, needless to say. I got up the next morning and now I was working for

my I did a complete hundred return. I was working for myself, for my future, for my career. I had the best attitude in the kitchen. I was the hardest working guy in the kitchen, and I the day before, I was the laziest guy in the kitchen, a lousy attitude and working for the man and working for beer money.

So now you are change, Yes, I guess so for people who may not have ever worked in the kitchen, and I was a waiter and a short order cook in college, there's really especially during a rush, there's a tremendous amount of energy and sort of a controlled chaos. Is that exactly? That's a that's a great way, And for people who haven't experienced it, I could see how there's a tremendous lure there because it's always different every

day and there's so much stuff going on. What was it about that moment in time that had you flipped from being the bum in the kitchen to the hardest working guy in the building. Well, I just needed to find my way. I need to have my goal and that was the key difference. That was totally the key difference. And once I I've been goal warning it ever since. I still have on my desk today my fourth quarter

goals for my career for the next fifteen years. So I've been a goal center since day one and and it's worked well for me, and I'm still doing it today. So the Juvenary Institute of America is described has been described as the Harvard of food prep. You had written there are three kinds of c I A students, those gonning to be chefs, those who want to be in

the restaurant business, and those who were lost. How did you know that you didn't want to be a chef but wanted to actually be in the restaurant Well, it goes back to my goals. I knew I want to be a president of a restaurant company, and I said to myself at nineteen, Yeah, So I said, if I, uh uh, if I'm any president of a a restaurant company, I'd better know about food. And I was already working in the kitchen, but I didn't know anything about food. So I said, I'm going to go to the CIA

and learn about foods. And you they turn you into a chef even if you don't want to be a chef, and if you want to be in the management side, they still teach you how to cut. Oh, exactly exactly. Those fundamentals and those basics I still work with today and have been formed the base for my knowledge to build my career from. Let's discuss a little bit the process you go through in quote unquote finding great people.

A lot of executives say that's the most challenging thing they do is hiring, and sometimes you never know who's going to turn out to be great or not. You think you came up with a solution, tell us about it. The two questions I could ask thousands of times is where do you Where do you get such great people? And how do you deliver such great service? And I tell people the answer to the same, to essentially both questions,

we get the same people everybody else gets. I actually don't think it's that hard to get great people, uh, because I think everybody operate on the premise almost everybody's great. We just treat people great, and we inspire people to grow and learn and uh, and we care about them tremendously, and they in turn care about us, and they want to deliver great service, and they get excited about our company and they want to build their career. And it's uh,

such a positive momentum that permeates the entire organization. So you don't hire great people. You hire people and allow them to become great. Correct. And that's exactly right. That

seems like that's a challenge to do. How do you take a regular person in jobs that could be long, tiring, stressful and make sure that those folks always have a good attitude and always are you know, uh, striving for that the sort of greatness you describe, well, I think those long, hard hours not having a great attitude is a standard uh uh image of the restaurant business, if you will. But in our company it's not quite the same. Our company our number one value as our associates come first.

I see. I tell people that our company is built by its people for its people. Were not built for our investors, were not built for me. We're built for our people. You describe in your book a book that you found very influential, which was the customer comes second, which is somewhat counterintuitive and very much not how the usual management books discuss treating customers. Explain what the customer comes second actually means to your corporate culture. Well, we've

all heard of the customer comes first. That's preached almost everywhere, and here I am, as CEO of a restaurant company. I would say, our customers do not come first. Our associates come first. I'm even rasien enough to say we don't even have a direct relationship with our customers. We have a direct relationship with the people we work with, eight and day out. Our customers, who I call guests, come to see us once a week, once a month, once a year, sometimes once never gone forbid. But uh,

we have the direct relationship with our people. So I look. I described it as a triangular relationship. We take care of our people, are people take care of our guests, and our guests take care of our company. So that's how we do it. So obviously corporate culture is a big part of that. How do you go about building a corporate culture that encourages staff members to try to get to yes? How do you ingrain that into the philosophy of a restaurant company. Well, it starts with us.

You know, um, we say yes to our people all the time and they know that, and so, uh, yes is the answer. What's the question? Permeates every single corner of our organization And it might be as simple as a manager talking with some friends and hey, we're gonn a out of town in three weeks for a long weekend. You want to go? And he doesn't say or she does not say, I have to ask my boss, they say yes, I can go, no problem, and then they go tell their boss they're gonna be away for a weekend,

coming up here. And so, uh, that freedom and that belief that it's it's good for me, it's good for you, and so our whole team operates on that. So my office, we don't have a vacation schedule, we don't have fixed hours. We we we initially when it was just a handful of us, called it big boy rules. Hey, you know what you work is, come in, do your work. If you've done it three and you want to go home in three, who cares? And we assume you're not going

to be abusive on vacations. But one can imagine when we're twenty five people, your thousands of people, how do you make sure that people aren't taking advantage of being abusive of that? Well, our culture, in many ways, UH deals with that. But in particular I've always led the organization believing we lead the organization for nine percent of the people that are good, not the one or two percent of the people that are bad. And so, yes,

do we have people to take advantage of us? Sometimes yes we do, but we don't let that affect the positive work environment that we have in a great company culture that we have for the other of our people to enjoy. And and you're one of the executives who feels that your job is to help everybody else correct do their jobs. And I'm gonna throw another quote at you. Uh, instead of worrying so much about how I did my job, I switched my energy to helping other people do their jobs.

This was another epiphany moment you describe. Tell us about what triggered that that reversal and and how is it helped you in business since then? Well, it changed my life. One day as a younger general manager, I got I was working my tail off ninety hours a week, and I thought how successful the restaurant would be was how well I did my job and how hard I worked.

And uh, my boss called me into his office and uh, so you just had a clandestine me with eight servers who were gonna have mutiny on the bounty and either I go or they go. And he said, listen, he's gonna stay, but I want you to stay and let me talk to him. And so he told me about this meeting and I was shocked. I thought I was doing a great job and but I wasn't even focused on new people. I wasn't even worried about the people.

I was running around, falling around the restaurant, making sure they were doing their job right, etcetera, etcetera, with a fine tooth comb and driving them nuts. Basically, So I UH said to him, I said, I'll change my attitude. I'll change my way. And I read several books, and I thought, and I reflected, and I created, uh this leadership style of working UH through the people. We're here to support our people. And and then when I realized, it's not how well I do my job, it's how

well everybody else does their job is what's important. I and all my focus was on support all of my fellow associates that worked in that restaurant, and the whole thing changed on it on a time. So, how do you spot talents when you're when you're looking to bring on executive chef or even even a sous chef, or or someone at the front of the restaurant, host or hostess or a manager. What are you looking for in that process? What do you think you could just pretty

much take anybody and move them into that role. We pretty much believe we can take about anybody. So we don't really do much outside hiring. Ninety percent of our people come in from the hourly associate ranks and prove themselves at that point and and get promoted and grow with our company. Not to say we don't outside higher but very rarely. I don't want people to work and build their careers with the company and to have us outside hire someone on top of them after they worked

for the company for years. So talent really identifies itself through their job performance. As we move along, let's talk

a little bit about the book you wrote. Yes is the answer, And I have to start with the Milkshake story because it's got a little bit of five easy pieces to it, a little Jack Nicholson and then a little twist ending you and your wife are out with the family at a restaurant and you obviously can look at all the items on the menu, and if they have bread and they have cheese, you should be able

to get a grilled cheese. Accept Some places say no, tell us about that that moment, which I found amusing it while we're dating ourselves that we know Jack Nicholson and five easy pieces, right, So it's the film buffs who are younger will certainly know of the of the movie and the famous chicken salad scene. You can find that on YouTube if you're not familiar with the of the movie. But you're at you're at the restaurant. What happened?

So I wanted a grilled cheese sandwich. I had my four year old, my two year old with me, my wife and my mother and father in law, and so I want to get a grilled cheese from my four year old son. And uh, the gal says, we don't have grilled cheese. I said, okay, So I end up ordering a club sandwich. Hold the turkey, hamlets, tomato, bacon. So they had the bread, they had the cheese, and they had the grill. How Hard said, if you can saute this on both sides, that be fabious. So I

get that cheese turkey club. So then I asked her for a chocolate milk shake for my son, and she was, well, all we have is a Hoggandah smoke shake. It's like a quart of soft whipped ice cream. It's huge. It's way too big for your son. We just can't do it. And I said, okay, I said, can I will you ask your manager. So she goes to ask her manager. I see the manager shake her head. No. She comes back says, we can't do it. I said, okay, well can you have your manager come over to see me?

And my wife starts to kick me under the table. Don't do this, And I said, I just want to know why. Can I assume your wife has seen this movie before. I mean, this is not the first time, right, you've experienced what should be a yes and no, and you're just just miffed by the whole prod exactly, And I want to know why. So uh, she comes over and she says, well, uh, the thing is, we pre portion our ice cream, and we give your son a little bit of ice cream. What are we gonna do

with the rest? Now, I've been in the restaurant business at this point in time twenty plus years. I know no one's in back pre portioning the ice cream. And I say, okay, I said, well, will you can you make a chocolate milk for me? She now, she's great hospitality. Absolutely, I'll get your chocolate milk and starts to turn away. I said, hold on a second. She had hot, too hot desserts on him menu It said a hot carrot one carrot cake and chocolate. Brannon is hurtess and all

amode to? I said, what's all amode me? She's well, that's a scoop of ice cream. I said, perfect. Can I get an order of all a mode to go with my chocolate milk? And she said yes, but she chastised me. She said, this okay, sir, but it'll be expensive, and she was visibly upset with me and my wife. By the way, while you're all amoting this, hey run the whole thing through the blender, and now it's that

milk exactly. So I get the milkshake. And a couple of weeks later, on the keynote speaker at aison lunching for our local business magazine, I'm telling the story how the answers, yes, what's the question? Or yes is the answer? What's the question? However you want to phrase it? Um, And I tell the story. And so about two weeks later, a gal comes up to me on the street. She said, my husband saw you speak at the Hyatt, thought she did a great job, and I want to take you

up on your milkshake story. And so he went into one of your restaurants to the bar in order to try to order a chocolate milkshake, and they said no. And it's like she punched me right in the stomach, right there in the street. Tonight, I went into our Monday morning executive community meeting, fired up and said, you know, uh, our yes is the answer. What's the question? Is not permeating our organization well enough. We need to correct this.

And so we started a brainstorm and we started, well, let's tell that story, Let's make a video of that story, and uh, let's do milkshake pins Let's make milkshake the icon of hospitality and CM are all great stuff, and people have little milkshake going on right now. And basically it says if someone asked for something a milkshake or otherwise,

if you could deliver it the answer exactly. So I Uh, every new associated starts the company goes through a for our orientation into the company culture and philosophy and values and so forth, and we make every new associate that starts with the company of chocolate milkshake that day, and we take a lot further than that. We make thousands

of chocolate milk shakes every year. We start every major meeting, every staff meeting with a milkshake, toast to everybody, celebrating great people, delivering genuine hospitality, and yes is the answer. What's the question? So how do you how do you make sure that the customer experience is consistent across all of those different locations, different suppliers, different regions, different managers,

different staff members. If I walk into a camera Mitchell Restaurant here, there or elsewhere, am I going to get the same hospitality in the same meal or is it going to vary widely? But you're gonna get the same We are in UH coast to coast, were as far west as Beverly Hills to New York and everywhere in between. And we talked about our culture and values. You know, we have the same training programs across the company, we have the same standards, etcetera. But our culture and values

UH is the backbone of what we do. And I look at it this way, Um, we teach our people our culture and our values. We teach them how to think, and if they know how to think, they'll know what to do. And so early in our earlier years, our culture and values as we spread out of town did not resonate as well as it did out of town as it does in town. Why what do you think that? Because we opened our restaurants without a town people and so forth, and we uh didn't really know how to

transfer that culture and those vous. We didn't we brought people in. We thought if we hired it outside manager, then come in for eight to twelve weeks and train and and learn. And it's just not that way. So can you change twenty years of experience in ten weeks now? Now we take usually take six months to a year for an outside hire to really adapt and learn to our culture. So today we won't open a restaurant without

a homewre own management team in that restaurant. And it's very important to inculcate that culture uh into that new property, no matter where it is. So restaurants are notorious for having a very high failure rate. You described the second restaurant you opened as, Uh, you're you're prepping, You're in the empty building. A police officer comes in and, uh, he's just checking on the building. What he's doing here? Oh,

we're opening a new restaurant here. And at that point, after you already committed on the lease and you've already raised money and we're under construction. Yeah, hey, what's this neighborhood? Like? Is it safe? And he kind of surprised you with his answer, didn't he? Right there, there's been some some trouble, wasn't there. Yeah. So it was seven o'clock at night, you know, the construction team's gone. I'm just it's a beautiful,

clear night, and I'm talking to the police officer. I look across, you know, a couple of blocks down the way. I see a lady dressed provocatively walking down the street. And I said to him, a lady in the evening. That's in the evening early And I said, uh uh, she prostituted. He was, oh, yeah, there's a bunch of them down there, but there's some hotel dinner. And I said, well, is this a safe area? You know? Yeah it is,

but you know, we had someone got killed. I was just seen two nights ago across the street here blood everywhere, and I'm like, oh, my goodness, what have I done? So? And but you meanwhile, that restaurant was around for what seven years? Yeah, But generally speaking, when a new restaurant launches, that's that's a u The triumph of optimism over rationality, isn't it. Most restaurants don't even last two years, right, So how do you how do you manage that those

challenging odds and continue to open restaurant after restaurant. Well, that particular restaurant I say, made enough to feed a cat for seven years. But anyways, and that was a mistake. And we've made mistakes and make lots of mistakes. And I look at his batting average. Um, I look at every five restaurants I opened, one is not going to do very well or might even close. The other three or what I call singles, doubles or triples, and then and the other one, the fifth one is a home

run out of the park. And so you average from all together, I get five good ones. So we know we're gonna get mistakes, but we've we've gotten better our craft along the way. And you know, I go back to um when the high failure rate in the restaurant business, to me is a little bit of them in this misnomer simply put, Uh, a lot of people want to be in the restaurant business, and they it's kind of

very relatively low barrier gentry as far as cash. Still a couple hundred grands to open any rest for your first one, maybe you can get away with that. You know, we spend millions of dollars today to open our restaurants, but certainly my first one was four hundred and put it that way. But uh, I always say, people don't walk around a grocery store pushing a grocery cart saying I want to be a grocer, but they do go

to restaurants. Let's say I want to And so if you think if you take out the people that maybe really shouldn't be in the restaurant business, out of that equation and the success rates a little bit higher. But because of that um it creates a lot of failure rate. So assume you have access to plentiful capital, especially your shop. You have a good track record for twenty five years. What's the most challenging thing about launching a new restaurant? Is it the location? Is it? The theme? Is that

the food? What? What's the biggest challenge? Well, you already took my first challenge out of the picture. Has capital access to plentiful capital? That's never been the case. It's it's a lot of capital. And you write in the book, how challenging. It was to constantly come up with every restaurant is four or five years ago, not not now, that's today. That's two million dollars right right, exactly so, and if you're in New York, it's five millions. We

spent eleven million open New York. Really that's a lot of money. Was it worth it? Very much? So? And I'm assuming Beverly Hills isn't cheap eve okay, we're so that raises the question. You have a lot of restaurants in Ohio and Columbus. I would imagine that's much less expensive. And if you could attract as much of a crowd, are are those restaurants more profitable or are they not capable of doing the volume of a New York or l A both? I mean, it's it's it's a We

talked about return on investment. It's about volume and uh, you know capital invested. So yes, there's less capital invested, but the lower the volume, so you might have the same return on investment as we have out somewhere else. So what are the other mistakes that that restaurateurs make? I have to assume being eneralized, we will take a break for dinner and we'll finish by midnight. Um, I under capitalization. I've heard from other restaurateurs. What what else

is an issue? Obviously by the book, Yes is the answer. What's the question? Is all about your values and your beliefs and your philosophies. I think are very important. A lot of people start out. I don't even have any values written down, or any mission or anything. Don't even understand that. So that's that's first and foremost of my book. Uh, Understanding brand and brand development. Restaurant brand development. Uh, you know I'm gonna have a barbecue restaurant that's super healthy. Also,

which is it? You're right, you can't have everything has to be congruent all the way across the brand. So an even restaurant branding itself has taken me years to really understand and and and maybe get a little good at it. Now here's mine naivete as a foodie here in New York. If the food is really good, you really have to go out of your way to mess that up. Am I wrong? Once you get to wow, this food is great? Is that sufficient or does that not get it done? Well? That's just I think one

leg of the stool. What are the other likes well, sir service, and you can debate whether food or service is more important or there's different studies on both. I think they're about equal. Really, I'm surprised to hear that, Yeah, you remember bead service, but you don't you know, I can't. I can tell you about a million spectacular meals, but I don't recall every saying this waiter. Usually they're unobtrusive, and when the service is really really good, you almost

don't notice it. Right, unless you're in the industry, I can't help but notice it. You're not going to go to a place that's got great food even though the services loudy. Sometimes you have a bab But also you're not gonna go to a place with great service and lousy food. Correct. Correct, So that's why I say, Hence, I think they're both equally important. Then, uh come as the ambiance, which is a lot of that is the uh unobtrusive things that you may not even necessarily realize

whether you like or don't like. You know, you might right, you might sit in the restaurant saidies don't really like this place. You may not know why exactly, but maybe the lighting is not right or the music is not right, all those intangibles to a certain extent, and then marketing. You know, Um, you can't really have a successful restaurant unless you also know how to market yourself because if you're you don't have a great location, people need to

find you. So you have to spend a lot of time and energy and tuning your horn to a certain extent in marketing yourself. So it's really those are the four legs of the stool in my book. So let's talk about another intangible. You mentioned the music and the lighting. I have some favorite places my wife refuses to go to on weekends because it's so crowded and it's so loud. It's not relaxing. You want to go on a Thursday or Sunday, I'm happy to, But Friday and Saturday night

it's a zoo. Is that an issue you have to deal with or is that just my Uh? It certainly is. You know, noise and sound is certainly an issue. We've had to add soundproofing to restaurants along the way. But uh, you know, first of all, little energy has got to be right. I say, people go out to be stimulated, not to sedate it. So, uh, in a restaurant tours nightmare is an empty, quiet nighting room, so we don't want those. So, uh, think about where we're coming from,

and we we want loud. We want that energy. Energy breaves energy earlier. The staff is happier, the guests are happier, everybody's excited. Um. But you have to be able to talk at the same time. You have to be able to converse and enjoy yourself. That that's pretty reasonable. We have been speaking to Cameron Mitchell. He is the founder

and CEO of the Cameron Mitchell Restaurant Group. If you enjoy this conversation, be sure and check out our podcast extras, where we keep the tape rolling and continue discussing all things food related. You can find that at iTunes, Overcast, Stitcher, Bloomberg dot com, wherever your finer podcasts are sold. We love your comments, feedback and suggestions right to us at m IB podcast at Bloomberg dot net. Check out my daily column on Bloomberg dot com slash Opinion. You can

follow me on Twitter at rid Halts. I'm Barry Rehults. You're listening to Masters in Business on Bloomberg Radio. Welcome to the podcast, Cameron, Thank you so much for doing this. I am a a foodie and I've gone out to

Michelin Star restaurants all over the world. I'm very happy trolling my way through Chinatown finding random Malaysian restaurants or Shanghai soupi buns or someone someone on Lynnette Lopez from Business Insider on Twitter mentions that there's this restaurant in Flushing called Galaxy Dumpling House, which goes, oh, they're opening a new location, they're testing out a franchise concept. And I said to her, we, you know, have some people do a pub crawl to go to a bunch of cars.

We did a dumpling crawl through Queen through my birthday year ago, through Flushing Queens. We went like a dozen. I got home, I didn't eat for two days. It was just that's a lot of dumpling. Galaxy Dumpling has like a hundred different dumplings on the menu. It's just and they're all, you know, individual hallmade. So I was intrigued. But when I saw your book and I saw your

your history, um, I was kind of intrigued by it. Um. I'm fascinated by the idea of taking a successful restaurant concept and expanding it elsewhere, be it franchise or or your own approach. And every now and then I'll see you a little restaurant and say, this is little place not too far from where I live called Cactus Cafe. It's just really good, simple Mexican food and grilled proving chicken in in a room smaller than we're sitting in

right now. And I was saying, every time I see this place, some they could open a hundred of these if they were wanted to. The stuff is it's not there's a million of these little places like that. This is different, it's unique. I'm shocked nobody ever did that. So I have to ask you, when you come up with a concept that's successful, are some of these successful? Is just not translatable? It's just lightning in a bottle

and it's that one location. And are you ever surprised when something that you thought, oh, this is pretty good but not spectacular, and then it has legs in it it keeps going? How do you How does that process go from hey, this is a pretty good restaurant idea, now they were a hundred of them. Well, it's kind of a multi prompt question. I think. You know, not every restaurant operator wants to build multiple restaurants. Not every you know, an under a restaurant operator wants to live

on an airplane and travel all the time like we do. So, um, I personally wanted to build a national brand. I wanted to do that, so we we kind of looked for it and we worked it. And building a national restaurant brand, uh, takes a lot of time and effort, years years of time and refinement of that brand. So it's not as simple as just replicating you're right, there is Uh, there's certain regionalities of the country. You know, barbecue doesn't necessarily

travel all over the country. It's just different, especially different types of barbecue. So there's just a lot goes into it. And I think just having a individual successful one restaurant doesn't always mean as translatable to build across the country or across the town. So now, what is the rusty bucket? What? What is that? It's a corner sure foot hundred corner neighborhood tavern concept. It's uh, we put in affluent suburbs. It's a great place. We really say it kind of uh.

Uh is the default vote? You know, you've got kids, you want to go out to dinner? Uh you don't, you know where wore the kids be happy? Where were mom and dad be happy? And that's where we're really basically bedroom pasta's, pizzas, that sort of thing, but good food from scratch, great environment. You know, the bar is right in the middle of it. You're gonna have people drinking at the bar and still walking with your kids and feel very comfortable. And it's that kind of place.

So it's really those affluent suburbs were in six states right now around the country. So a chain like the twenty three how large can that get? Is that something you would want to expand to two hundred restaurants or is it you just have to find the right place where it's a good fit. Well, we're still working on that. You know, casual dining itself and is um probably one of the more challenge parts of the restaurant business. So fine dining where Ocean Prime brand lies is doing very well.

We all know fast casual is doing very well. It's it's uh um competitive, that's the thing that's saturated, you know, And I've never wanted to get into that fast casual business because of that where do you draw the line on fast casual above, like, um, well, you know it's Chipole. You know everybody, everybody want to do the Chipole delivery model, and and everybody wanted the success of Chipotle, and you know you've had a lot of failures along the way

with that too. And but you have everybody her brother throwing money on it, trying to get into it, and I've just uh tried not to do that. I didn't want to do that. What about all the burger chains that are coming out to challenge McDonald's, some of which have really taken off very quickly. Sure, I mean shake Shack is actually a good example. Five Guys Burger is

another good example. Uh this At one point, I had our vice president operations leave us because he wanted to do a burger joint and start to burger craze, and I didn't want to get involved with it. I mean, that's a very competitive space and you have all the legacy McDonald's, Burger King, Wendy's, um go down the list, Arby's Summer margins. So that's a tough business that would imagine. Yeah, it's just something I prefer not to get into. So

Fast Casual is Chipotle and Higher. Yeah, you're not in the fast cast. That's that we would call that as limited service. There's counter service, etcetera. I'm we're in a full service space. The full service space is the casual brands like a Rusty bucket. You know, you can put Applebeas and Chili's in there if you want. There's others. Then there's upscale casual, and then there's the fine dinings. So we play in all three of those those segments.

Are there any upstir scale casual restaurants that have managed to build more than just a local footprint, Well, sure, the uh the national standard bearer, gold standard is Houston's uh said, polished casual segments. You know, those are who really the rest of us aspire to be cheesecake factories in it and that genre, you know, not as good as Houston's. But on that genre there is respectable, huge, huge media. It's a little bit it's a different approach.

But along those lines and and and those are the you know, then there's the fine dining brands like Ocean Prime. That isn't a major markets across the country. So New New York pass some rule on New York City about if you have more than five restaurants with the same name in New York, there was certain disclosure requirements of them. So the Houston's and some other similar chains in New York basically, well, we'll just change a couple of exacts and thanks for the silly rule. Yeah. Um, there's the

national rule to that. Over twenty units, you have to label all your menu items with the calorie counts and all that. I think that's what the New York and you know that's UM. The jury is still out on really how that's affecting restaurants. I was talking to a CEO of another restaurant company that has done that, and and it's just shifted the way people order. It hasn't really affected their business volume. So what does it do.

It affects the dessert order. Yeah, when they see lobster mashed potatoes or grotten at calories, they're ordering something else, but they're still ordering. So it hasn't really UM. And you know where you believe and that I believe in freedom of choice, and you know, people can do what they want. The problem is once you put the calories down, you're nudging people in one direction or another. I guess, Um, let's talk about tipping. I that's a big issue some people.

I was just in Iceland, where there is no tipping on the entire island, and when they told us that, I was kind of shocked. Although everything is kind of expensive there, so it's obviously no free lunch, it's built in. That said, it was kind of nice not having to worry about it to think about it. Where do you land on the should we have tipped servers or should we just pay them a salary and build that into

the price. Well, I definitely differ on that than our friend Danny Meyer, who's leading the charge on the note tipping program. And I understand what he's trying to do. He's trying to bridge that gamp and the disparity between front of the house associates and back of the house associates people and people in the dishwashers, the bus by people in the back. They're they're not making a whole lot of money compared to the bartenders, waiters, correct hostess.

And I understand it. But uh, and again the jury is still out on whether it's really working or taking hold in his company, he's doing it, and he's making that decision and trying to change the way we do business, and there's a lot of pushback. Um, you know, I'm trying to reserve judgment on that. I'm trying to keep an open mind. But I don't really like that personally. I like the tip, I like gratuity. I like uh, great servers make more money than not so great servers.

Think that's great. And now we on other hand, uh, tip of the hat to Danny. I mean, we're trying to take care of our back in the house associates more and and and still able to do that and giving them raises and paying them more along the way. Um, but you know, not everybody's cut out to be in front of the house. Not everybody's cut out to be in the back of the house, and not everybody, uh

makes the same amount of money across America. So it is what it is to a certain extent, and I do personally like to up and I think it's one of the great hallmarks and hospitality. So one of the questions we didn't get to during the broadcast portion was the different regions in the country. Um, you mentioned Beverly Hills, what about further up the West coast, San Francisco, Portland, Seattle. Are you in in those locales or are you interested

in going there? Well, Uh, they're tougher markets to do business in because of the regulatory requirements and so forth. But and we had a deal in actually Seattle, and we passed on that deal because of that. However, we're working on a project currently in San Diego, and we're currently looking up in northern California. So um. And there's lots of great successful restaurants in California. Portland is a

fantastic food city, really good food city. Although people have told me that it's very difficult to move the needle. If you need any sort of local government waiver or approval, it's can And there's a lot of independence. There's a huge independent dining scene in too. So um. That's probably we might not be top of our list in terms

of national destuls. So you started in Ohio. What about places like Chicago and Indianapolis and other major cities in the industrial Midwest, Sir, we're in uh we you know, we started building outside of Columbus in the Midwest. So we're in Chicago, We're in Detroit, Indianapolis, Columbus. Um. Natural Movement from there in Florida. You know, we have a

lot of those are where are you? Are you in Florida? Yeah, we're in Naples, Tampa, and Orlando, and we're looking now on the east coast, the Boca North Miami Palm Beach area. And which which concepts do you want? Really? So you want to go high up, high ends in all those places? Correct? Correct? Very very interesting. Yeah, Ocean Prime is the brand we're building for the time being. Um, you know, we're you know,

we may build more Rusty Buckets. Like I said, we have two concepts within our our independent group that we're looking to maybe take outside. So I have to ask you a naming question, a brand new question. Ocean Prime it sounds very high end, you fresh seafood, Prime, Steak sounds great. Rusty Bucket isn't a name that comes to mind about a restaurant. What what's the concept? Like the branding concept? It's casual. That name kind of came out as a fluke and um and took off and it

has legs. But yeah, when we go to new markets, people like what is that? And we have to explain a little bit more. And restaurant naming itself is very challenging because that name you want to reflect on what that brand is. It's just like Prime exactly, So how does rusty? Yeah, but there are there are examples to that that you know, have broken that mold to a certain to me easier or not to me. I hear Rusty buck and I'm like, do I want a Rusty

bucket of food? It's it's so countintuitive, but I know that's been a very successful chain for you guys. So whatever that quirkiness is, it seems to catch ps. But but once people once it's in the neighborhood, people kind of it stays with them and it's like, oh, the Rusty Bucket, it's a very different Um. It's not McDonald's clearly, and it's not Ocean Prime, um, but it seems to

have found a sweet spot right in the middle. Well, what you get is people say, let's just go to the bucket, and it's just the bucket that that's that's really interesting. So we went over tips um, and we went over branding. I have to just a little bit, just just put a toe into the con restaurant concept creation because you describe in the book, you describe the process, but it's very generic. You don't get into the specifics.

So I for my own curiosity, how do you come up with the brand new concept that's different from are you going to other restaurants? Is it brainstorm storming? How do you come up with, Oh, this is a new idea, let's test it out, and now it's in fifty cities. How does that happen? Uh? Well, I'm not sure there's really a lot of new ideas out there. It's just your version of your artistic impression of someone else's new idea and the twenty people painting the fields out the

window exactly. So I think, you know, in every restaurant we've done kind of has a story to it, you know. Um we have a restaurant called the Barn at Rocky four Creek and it was an old barbecue restaurant, and um, our guy said, they called us and said, hey, we've gone out of business. Would we like to put a restaurant there? And I said, no, we don't want to this barbecue replace this bar now, we don't want to

do it. And I remembered, uh as I was saying that, Uh, well, the one of the top grocering restaurants in the country is called the Angus Barn in North Carolina, and it's the top restaurant in North Carolina. And I said, boy, this barn is perfect for that concept. It could be perfect is the concept of the they say, uh, upscale casual steakhouse, kind of a little little bit of a

Ralph lauren Field. It's not fine dining, it's not all white tablecloth, but it's it's approachable and um, between cat fast casual and fine dining, well somewhere between fine dining and upscale cats just a little bit up there. But and and we did it. We have another restaurants site in our short north of Columbus that this location became available. And this is back when the gastropub craze was going on across the country. And and so we said, you know,

I called the land ord up. He said, what are you gonna push? I said, I don't know, but I'd like the site. But they'll be fried chicken with street street tret shots sauce on it. And you're exactly In fact, I was just there last night. So um, you know it's just two pans now Ocean Prime. You know, we we wanted to build a high end steak and seafood restaurant, and we didn't want to necessary Botto Steakhouse, and so

that's how that it was. Original name was Mitchell's Ocean Club and when we sold to Ruth Chris, I sold the name Mitchell's specifically, so we saw had Caram's restaurants, but it was Mitchell's Fish Market and I couldn't call Mitchell's Ocean Clubs. So that's when we rebranded and came up with Ocean Prime and we felt it fit the the concept perfectly. I know I only have you for a certain amount of time, So let's jump to some

of our favorite questions that we ask all of our guests. Uh, nobody's gesturing at me yet, but sometimes they'll wave and say, we have Uh, you know, I get the bring bring the plane into the carrier. Um tell us the most important thing? People don't know about your background? Although after the book, I don't know if there's a whole lot of stuff. Yeah, that's a tough question because I am an open book and its talks about that, and yes is the answer. What's the question I would say? If

what people really don't know about me? As I'm still an entrepreneur, I'm still chicken little. I'm still scared every day. And uh, even with the national success we've had, I still wake up every morning and check our numbers and see how we're doing. And and I'm nervous all the time. So that's that's a surprising answer. You you mentioned the fourth quarter for a Cameron Mitchell. Really at this point I should ask you, what what are your plans for

the fourth quarter? Well, two things one uh, and I'm working on this currently is to move to truly a chairman's role within the company, which is chief strategy officer, if you will, uh. And then really uh chief steward of the company and and legacy and stewardship of the organization and really about part and partial. While we were at the book, guess as the answer, what's the question is to share that knowledge and to tell that story. Uh.

We uh were the lead donner. I'm opening and sharing the fundraising efforts to build new eighty thousand square foot Hospitality Management School and Columbus at Columbus State College. Um, we are opening to Bud Dairy Food Hall, which is uh takes ten restauranateurs, young buddy restaurateurs will be in this space. And our goals to help and we run the bars, and we run the food hall. We curated these restaurants, and our goal is to help take these

restaurateurs to bricks and mortar restaurants along the way. Um, just all about the young leaders in our company, working with them and helping build their careers, etcetera. Tell us about some of your early mentors who helped guide your career. Yeah, I didn't have really uh a lot of early mentors and who I talked with. I believe people could have mentors that they don't even necessarily know. Rich Melman and Chicago that's entertaining your restaurants was certainly one of mine.

Norm Brinker from Chili's his book and he's been inspirational to me. Dave Thomas from Wendy's his story. Um, there's lots of those. Herb Color, CEO of Southwest Airlines. I think their story and how he ran a business is incredible. So, um, those are some of the people I looked up to as I was coming up the ladder. You mentioned a few books. What are some of your favorite books? Um, My all time great favorite book is good to Great.

Jim Collins. I'm a Jim Collins disciple. I think he was instrumental in that book, was instrumental in helping turn our company around and ultimately resulted in the sale of the fish Market. It's been instrumental in the ability of the Ocean Prime brand itself. And um, so I love all the management books pat Lyncone. Uh, I've read every single Spencer to the Who Moved My Cheese? One Man Manager, all those leadership books, I've it too. I find it

was very valuable. So and you you mentioned in your book, Um, the Customer Comes Second. Any other books from your book you wanna bring up a reference? Uh? Well, the Customer Comes Second was from how Rosen Booth that that was inspirational in helping me write the company Culture and Values. Uh. Um, I think yes is the answer. What's the question I think will be hopefully people. UM tell us about a time you've failed and what you learned from the experience. Um.

I'd like to think I've never totally failed. I've been knocked down many, many, many times, and um the biggest Uh. But I would think failure in my experience was we've had restaurants fail, etcetera. I've made some mistakes there, but really after two thousand eight, we just sold you know, two thirds of our business for ninty two million dollars, and I in my humorists and my ego, and I ran out and signed a bunch more leases. I was

gonna uh another twenty plus million dollars in development. I was gonna rebuild the even that we sold and uh it took ten years to build. I was going to rebuild it in three years. And and then the great crash happened, you know, eight, and these restaurants didn't perform well, and I almost ran a company off a cliff in two thousand nine. It took some really lousy entrepreneuring to get us into that mess, and it took some really hard work and great entrepreneuring to get us out of

that mess. So if a young millennial or a college grad came to you and said they were interested in going into the restaurant business, what sort of advice would you give them? First and foremost, anybody started a business,

I would say, get some experience. You know, we have a lot of these young eighteen eight twenty year old two I wanted to just graduate from college, start their business and make a bazillion dollars, And I think people need to get experience first, first and foremost and work for some successful companies and understand what it takes to be successful. UH. Secondly, they better think about their values and their culture and what they stand for and get

those identified right away. And thirdly, you had to be willing to UH work your tail off and be knocked down and get right back up. And entrepreneuri has been one of the toughest things I've ever done in my life, if not the toughest thing. And our final question, what do you know about the restaurant industry today? You wish you knew twenty five years ago when you were first

launching Oh, sure, you know. I think the biggest thing I've learned really is the power of branding UH and how to develop restaurant brands and how important that is and that the brand, all the brand touch points and the brand DNA UH is congruant with everything across that brand. So that took us a long time to learn, and it takes years to really refine a brand and really to create a successful brand doesn't happen overnight. H quite

quite interesting. We have been speaking with Cameron Mitchell. He is the founder and chairman of the Cameron Mitchell Restaurant group. If you and joy this conversation, we'll be sure and looked up an Inch or down an Inch on Apple, iTunes, Stitcher, Bloomberg dot com, wherever final podcasts are sold, and you can find any of our other two hundred and prior podcasts over the past four years. We love your comments, feedback and suggestions. Be sure and write to us at

m IB podcast at Bloomberg dot net. I would be remiss if I did not thank the crack staff that helps put together these conversations each week. Medina Parwana is our producer, Attica val Bron is our project manager. Taylor Riggs is our booker. Mike Batnick is our head of research. I'm Barry Ridholtz. You've been listening to Master's Business on Bloomberg Radio.