Troy Hooper Brings the heat with the story of Pepper Lunch and it growth in North America

basis. But before we get into the brand that you get to run Troy, why don't you introduce yourself to our audience that's less familiar with who Troy Hooper is?

I went to culinary school, and I became a chef and I cooked for almost six years, in a couple of restaurants, but really had that entrepreneurial spirit and have ever since been on the corporate side of both hotels and resorts and private clubs, as well as fine dining restaurants. And about six years ago, I decided to take our consulting practice and focus solely on emerging brands in the QSR, fast casual

space. Mostly, we still do some full service and casual brands, but mostly focusing on the high growth opportunities, and the exciting elements of new and innovative concepts and brands and working with founders and operators. So we've been doing that for the last six years. And pepper lunch came calling almost exactly a year ago as a matter of fact, and, and we've been involved with them and ever since and we're here to help make that brand even bigger than it already is,

web. I've been keeping up with you on on social and there's a lot of us crazy people that have been doing this for a really long time. So maybe that's maybe that's a business opportunity for some entrepreneur out there to go get right. Therapists for the restaurants because we're a sick, sick bunch for sure.

it's at. So for those that are less familiar, you talk about getting bigger than it already is. Pepper Lynch is already a pretty established brand, and other places in the world. But people in the United States may not be familiar with that. So if you would, why don't you take us back to kind of at least what you know about the origins of it and kind of where it came from, you know, from from the Asian side, and then kind of its entrance to the United States and where it's gone.

firm that we're a part of. And but 9094 You know, beef prices in Japan particularly are always very high, because they import about 98% of their beef. They actually export most of their wagyu. And wagyu is a very, very small production. business in general. And so beef in in Japan is very, very expensive on the whole, and especially in 1994 You know, the imports weren't as high as maybe they are today and prices were certainly on

attainable for most people. And so beef was considered a sort of a specialty item that you would have at celebrations at home you would you would make dishes or if you went out to a steak house, you know, that would be a very, very big deal. And most people still couldn't even afford to do that. So our founding chef decided that he wanted to make beef more affordable. And one of the staple dishes in Japan is called

beef pepper rice. And it is our core and signature item that we were founded on and is still actually our most popular are sold many menu items today still. And so this is a dish that you might have take a 18 or 22 inch iron skillet and put a big pile of rice in the middle and put some corn and margarine and pepper, black pepper and salt on it. And then you would put this slice beef all the way around the outside and you make this kind of doughnut on donut of beef and rice and vegetables.

And this is an item you would have as a celebratory item in a family meal. And so they would put this on the center of the table and everybody would be able to partake of it. So that dish was the impetus of this brand. And the idea was to take that dish and shrink it down to an individual size. So going from giant pizza to personal size, right? And how do we make it personal size? How do we cook it fast? How do we make this something for the everyday person both on affordability,

but on convenience, as well. And so he created the first experiential, fast, casual brand. And what do I mean by that this experience when you come into a pepper lunch, invokes all the senses, you hear the sizzle, before you see the plate, the effervescence of the odors are coming, you know that that steam, visibility of that steam and bubbling happening? Boy, the taste is amazing. So it really engages all of your senses from before you ever even

see the plate. And so they created this concept and it required some specialty equipment. And so he took the iron skillet and made it an iron plate took that handle off of it, and figured a way that if he added a metal core that was not an iron core to this plate, it would superheat very quickly and it would also hold heat more lot for longer. And so he created

this plate. And then he found an induction unit, electric induction unit and modified it and created his own, which we call a high energy on demand induction unit, you actually stores energy, you push a green button, it delivers that energy this plate and takes that plate from room temperature ambient temperature to 500 degrees Fahrenheit 254 degrees Celsius in 74 seconds. So this was the creation of pepper lunch. How do I make beef more accepts?

accessible, more affordable? How do I make it more convenient? How do I shrink this iconic dish down to an individual size? And what equipment will it take? And he invented the equipment to make it happen. And that is the foundation and formulation of veterans? It's what we are today?

started. But you know, how is it grown and what is it turned into, I guess internationally before we jumped to kind of where things are at on the domestic side and talking about the the food and all of that because I got on the piece.

franchisee outside of Japan. And they are responsible for actually proliferating this brand all throughout Asia, outside of our domestic business in Japan in today. We have 200 stores in Japan. And we have 508 Total around the world in 15 countries, including the United States, Canada, the territory, the United States, and Guam, Australia, and all Asian nations, except for Mongolia, which is in the plans by the way. We're in every Asian nation except for Mongolia, and we're

coming for you Mongolia. It's growing by the way Mongolia is growing. So you know,

opportunities are. And one of the opportunities obviously being the United States, which we'll start to talk about in a moment. But also they really needed to scale up the infrastructure more more quickly. So what they did was they went back to Centauri and they asked if they could buy the franchise business by the Suntory pepper lunch business and we did just that we actually bought the entire food and beverage portfolio back from Centauri. So now we own all the

Suntory related restaurants. But the biggest one being pepper lunch. And they had, you know, not only had all of their own stores, corporate stores, but they had, obviously, the entire franchise network outside of Japan under their tutelage. So we now have this larger, more experienced infrastructure. They've been with us for 28 years, right, so. So now we have that fantastic infrastructure that brings all of that institutional knowledge and

experience. Three of our top five executives, were the three general managers of the first three stores that opened outside of Japan. And they've been with us ever since. Right? Very. So there's this fantastic connection to the history of the brand, lots of institutional knowledge and experience and an amazing pride. And so I get to be the beneficiary of all this

energy and excitement. But the real reality is the largest opportunity for pepper lunches growth going forward, in the near term was to, to grow in the United States and Canada to take on North America and really put some significant effort there. And that's where they came to us and me and particularly, and said, Hey, can your company and your team helped us on the infrastructure development build out the business in United

States? And would you be a part of that by being the CEO of our parent company in North America and help us on a global scale with our other CEOs to sort of cross pollinate knowledge and experience and resources. And I said, this is a fantastic brand. I'm thoroughly excited, I hadn't outsourced myself for over seven years and taken on a role outside of my own company. And I said, you know, I just can't pass this up. This is this is a fantastic opportunity, and a really cool brand, with great,

great people behind it. And I'm just honored and truly blessed to have this chance to be a part of it. It's a lot of fun.

domestically? Where? Where are you guys open today and then talk to me a little bit about kind of your growth trajectory for where you guys are at because it's not a name brand today in the United States or Canada. And so you guys are going into communities? And where are we at today? And kind of what's the strategy on that, from that perspective? Yeah.

there. And then we came to United States as matter of fact, what what they did was they asked our Australian franchisee, if they'd be interested, given their experience with the brand of over 12 years and 11 stores in Australia, would they be interested in helping the brand grow in North America? And so the up so they said yes. And they sent one of their four partners here to live. And they did a fantastic job. They

arrived in 2015. And by 2017, we're under construction, and in 2018, opened three of the five continental US stores, and in 2019, open the other two. So in 18 months, they opened five stores across three states, United States, not being US citizens never having lived here. So kudos to them for doing a phenomenal job. But they open three in Southern California and LA in Orange County, with Irvine, Artesia and Alhambra.

And then Las Vegas, in, in Chinatown, in Las Vegas, just off the strip, and then in Houston, in what's known as they're trying to town as well, which, you know, smart move to put a footprint in a new country is to sort of be near to the population of people that would be familiar with not only the brand potentially, but but certainly the food genre as well. So that's where we are today. With with obviously the plan to conquer the rest of the

United States. And we estimate conservatively but but we think appropriately. We believe the United States could handle at least 600 locations over the next 10 years.

that type of cuisine. And then people get experience with it and so trim minute I'm gonna pivot a little bit I'm gonna geek out a little fanboy on the on the food experience so fast, casual excited, you've been there so many relatively small footprint, and again, selfishly like I said, I've been watching online. So I've watched some of your guys's food tours in Southern California in Vegas

over the last few months. And so with that, what is the experience like because it is different than anything I've

ever experienced. And truthfully, part of what I want this audience to hear is it was hard for me the first time I went it was hard because it was it was not your typical Dave's hot chicken you get a you get tenders or you got sliders like you get you know, you're going into a to a taco places like you're, you know, you're getting tacos or you're getting, you know, a burrito, you go into burger place you're getting,

it's not that. And so talk me through kind of even, you know, you talked about really that that rice and beef bowl that kind of the staple of your menu, the pepper, you know, beef that that originated everything. But it's so much more than that. And I'd love for you to geek out for just a little bit on that. Before we get you know, before before we dig into much more because again, I'm salivating I just ate lunch and I need to I need to go find myself a pepper lunch somewhere. So

creep. So we're doing a little bit of a retooling just to just shrink it back down just just a hair not much. But look, this is

a phenomenal brand. And honestly, there is something on the menu for everybody that is one of the things that I really admire about the concept is we have eight categories, you know, eight sections of the menu, the pepper rice section, is pepper rice can be done with any of our proteins, beef, and chicken and shrimp, and salmon, etc. So you can have pepper rice, many different ways, which is just the BASE PROTEIN plus rice plus veg sauce it the way you like

right. So that's the simple sort of salt and pepper version of our food. And then we have have the same exact options in the curry vertical, the teriyaki vertical, etc. So we have sort of the plain pepper and salt option, a curry sauce option, a teriyaki sauce option, and we have a cream sauce, which we use for our pastas. But look, a lot of people do a cream, beef and cream chicken. So basically the cream sauce is its own sort of vertical, it makes it really

easy. If you look at it in these categories, we have a seafood section, we have a steak section which is unique. We only serve maybe one steak in most of our stores worldwide. Here we've been up to six steaks, we're kind of bringing that down a little bit to probably three or three or so steaks, but we sell a lot of steaks. It goes very well and people in America love steak and vegetables. So steak and rice is going very well

there. And then we certainly have a vegetarian option vegetable only version of that. And then we have a rice sorry, a salad option. We have a beautiful large salad and have a small I would call those shake salad to to go kind of like the McDonald's shake sounds pretty similar. So there's eight categories. If you kind of pare it down that way you can just take any of our proteins and match with any of our sauces and

veg combos. And that's what makes it what we call DIY teppanyaki Yep, we're not gonna build your own bowl or build your own down the line concept like a blaze pizza or Chipotle, but you can really customize from our menu any way you like. Add to that we have what we call add ons. Man roasted garlic chips if you haven't Jeremy next time, I don't care what did you get add roasted garlic chips

with suggestions. And then once you place your order you get your beverage Have a seat just like you would at any other fast casual. And in five to seven minutes, we're going to bring you this sizzling hot plate of ingredients and the proteins are going to be raw with the exception of chicken. You're going to cook it your way we call it sizzle it your way, you're going to enjoy that sizzle in that bubble and that effervescence but you're going to really create the dish the

way you want. We have two table sauces we have a garlic soy that you mix up the garlic in the soy sauce with a little stir stick and you can use as little or as long as you like. And then we've got a Japanese Steak sauce. It's an apple plum, sweet, sort of like a sweet barbecue in a way they call it steak sauce. So you can do that as an alternative flavor profile. Look, one of the favorite things to do is get a non curry dish and order the curry on the side or the cream.

So this is how you can really build it and make it your own way. And so what we find is most guests Come the first time and they're not sure what to have. And so we suggest beef pepper rice, that's our signature dish we were founded on and we might tell them about these other add ons and enhancements they can do. And we definitely will instruct them at the table of how to sizzle it their way you know, table sauces and, and the process of how to how to make

the best way possible. But then you find once you've been there once or twice, you get pretty adventurous pretty quickly and you start experimenting and playing with the menu and I'll give you on Jeremy next time you're in I told you, I want to host you and visit you visit with you when you're here. My favorite dish today is actually the seafood pasta olio. And I actually do all shrimp, I just leave the scallops and salmon off. I do all shrimp with pasta

and cream sauce. It comes with mushrooms and then you can add the other enhancements as well. But man, there's just that black pepper flavor that is really evident in that dish. And I love the pasta. It's it's kind of light for a pasta feels very light for lunch. So it really there's almost endless options. Right?

I went early on because the the office was right near the the Irvine store but but longer term, it's like you guys have evolved, have evolved to meet those needs. And at the same time, one of the things that consumers are looking for, and I know you guys are hitting right on this as is they're looking for the power to choose, they're looking for the no veto rule, you can go there with your kids, you can go there on a business launch, you can go there, you know for dinner with your

family. And you can you can get the quality of food that's hot, fresh, and serve to your liking the way you want it. You know, it's the Burger King Have it your way, you know, you guys are hitting that. Talk to me a little bit about the the, I guess the fallacy that says people want this but no different than Korean barbecue or anywhere else that you might be cooking your own food on this hot plate. That probably creates

some opportunities. You talked about chicken needing to be prepared in the kitchen because you can't serve raw chicken, or you're gonna probably get yourself in trouble, somebody's gonna get sick. How have you guys protected yourself against them creating them. And I know years ago, I was working with California Pizza Kitchen, iconic brand out of Southern California and they were like, We won't allow somebody to put barbecue sauce and spaghetti sauce on the same pizza. We just won't.

Because it's gonna it's going to hurt our brand. And I was like, Well, that's very interesting. You know, you can do anything you want except for this. have you guys gotten any of those kind of, I guess toy from from that perspective? Have you guys dealt with any of that? Where you found that people are? are having a bad brand experience because of the way that they choose to customize? Yeah,

prideful people. And so there isn't this impetus, this there isn't this draw to, you know, evolve something or change something for the sake of change. Now to say that we absolutely have adapted it to every country we are in there are menu items that are very specific to the flavors, tastes and traditions of that country.

But we don't abandon or lose the authenticity of our founding flavors, sauces, etc. And we are extraordinarily over protective, we have an entire team who all they do is check specs, inspect our CO packers that create our sauces for us inspect the beef, packing houses and slicing houses to make sure that our

spec is always the same. They're not cheapening the product, they're not shaving grams off of the individual pieces like that we aren't getting what we pay for because we are very proud of the quality of ingredients. Look, you can get in and out of pepper lunch for $20.20 minutes. But I'm telling you that the quality of the food is better than most casual restaurants, you could get in and out of in an hour, right for twice the price. And so a quality of food

is very good. It's very helpful and clean that we don't there's no breading there's no you know, frying of that, you know, we have a couple we have fries and sweet potato fries and onion rings here in America. But besides that, and by the way, those are very good but you know, we take very good care of the brand and so that translates to everything we do. And the reality is is we don't have anything on the menu and Ingredient wise that we wouldn't be proud or think would be

authentic. If if you use it or, you know, brought it across into a dish. You know, the idea is that the concept synth is so simple that it's really protein, rice and veg, right. And any combination of protein, rice and veg is pepper lunch. And so we're not, you know, seeing a situation where we have this whole other sort of side menu and then people want ingredients from there. Look, I do that I go to lazy dog all the time. And I'm like, look on a Sunday morning. I don't want the Cajun

gravy. I want the regular gravy. Thankfully, they have to gravies you know, for my for my chicken and waffles. So I'm a fried chicken and waffle guy on a Sunday morning with a Bloody Mary. You know, we're not in that situation where we kind of have different genres of food, which casual dining has that right and fine dining, too. And that's where in those environments you say, Look, that's not really meant to do that. You know, we don't have that. So we're very fortunate in that regard.

themselves? Because that is to say, but it's like, you know, I've got four small kids, and I've got they're not small anymore, but they were small at one point, you always had to be careful to make sure that you were smart enough to make sure that it didn't hurt somebody. The first time I went there, they were very conscious of that. And I guess for those that that are getting this visual, talk to me about I guess even operationally how have you guys dealt with that?

experience. But you set it on this wooden board. We do that with it with a tool that we're not touching it right, it's 500 degrees. And then we put this ring of paper on it right before we put it in the window to go out. And so that ring of paper does two things. It first says Don't touch it's hot. Right on yeah and read letter. Most people don't read though I you know, I probably guilty of not really knowing what it says on it. And then, but it's just

thick enough. And quite realistically, it's 500 degrees when we put it in the window, but you know, iron, it loses temperature pretty quick. So the outer edge of that kind of comes off of that temperature pretty quick. But by the time you hit your table, that piece of paper gives you just enough physical barrier, that if you were to grab your utensils or napkin or drink and brush your wrist or your palm against it, it would register your brain is warm, hot, maybe even. But it wasn't

serious. The idea is just to prevent you from getting seared. And the reality is that temperature comes down from that searing level of temperature pretty quick. And so really, it's just buying you those few seconds to a minute to keep you from touching it inadvertently. And, you know, knocking on wood we've literally never had in 30 years next year. Never had an incident never had a claim. Never had a complaint that that was a problem for us. It's a little obvious, though, right?

It's not like yeah, it's not like oh, this is laying in front of Mexican restaurant, they put a ceramic plate in front of you and say that's hot. And he was holding it with his bare hands, maybe a light rag. But they've been doing that for years, right? His hands are numb, and you touch that and it's like, Oh, that's really hot. You know, we don't have that same scenario but but similarly it's like hey, you learned pretty quick that that's probably not something I want to touch. Yeah,

lunge veteran. When I look across the room and I see people taking the ring off and folding it. I'm like Oh, they've been here before. They know that get that ring out of the way. I just I just want to eat my food.

understatement. Because quite frankly, there's lots of I mean, you get small little footprints, fantastic food, lots and lots and lots of runway for you guys. Where are you guys going? Next? What what is it? What does the future look like for those that have yet to experience it? And when can they expect it to, to kind of come around?

right? If you have 10 to 20, or 30, restaurants, across a couple of brands in a city, that you probably know the area very deeply and have great community roots that's important to us. And so these are the folks that we're working with and talking to early, we've been very, very fortunate to have a lot of fantastic inquiries, and be building a lot of very strong relationships with these types of groups throughout the last

number of months. And so, as of the time this podcast will air, it's official that we have sold the state of Arizona, we will have at least 10 stores in the state of Arizona, those partners are really excited, we're very excited to have them as well, they're very experienced in the business. And they're going to be very aggressive. They're looking at coming out of the gate with two or three stores under construction simultaneously. Wow. So we have a couple of partners with the

same mindset. So you know, that is the one that is announced double today. But I'll tell you that I expect by the end of the year that we will have between five and seven states, either fully territory built out, as far as commitments, or big chunks of some of the bigger states committed, we expect and then are on the trajectory to exceed 55 units committed this

year. And by the way, for those friends in the industry committed for us means that they have actually fully paid all the franchise fees for all of the stores they are committing to upfront. This is not a deposit or a promissory note on future growth. These are hard commitments, and these folks are going to build the stores. And by the way, we've actually added an aggressive element to it. If you buy a minimum of five stores from us, which is where we start, you need to build those

in three years. It's a one year to do one store, and then two stores a year after that. And so that schedule continues whether it's 1015 or 20 units. So we are looking for fast growth with experienced operators because like being around 30 years, having the team that we have having the experience to be in 15 countries, we grow at five stores a month now we are currently opening five per month, as I'm talking to you, we have 508 stores, in three days, we will be official and ring the

bell for 513 stores. So this trajectory continues for us in the foreseeable future. And so we believe that because of our simple operations, our simple equipment and kitchen design package, and our experience building lots of restaurants very quickly in our history. With the team that we have, we are fully geared up and ready to go. Our supply chain is established nationally already. We have all of our embassies and contracts in place. We have equipment being staged

throughout the country. We manufacture and provide our cooking equipment, the induction unit is actually manufactured for us. And we actually warehouse that and supply it ourselves. So we are pre staged and ready to go for massive growth. So that's our model for the foreseeable future. We're excited about it. We're seeing fantastic uptake and interest in it. The phones are ringing we're

very happy for that. And I'm just excited to see pepper and lunch start to be in places like Phoenix and very likely in Honolulu, Hawaii and more of them in California. Certainly coming to Texas I'm sure we

LinkedIn, pepper lunch restaurants on LinkedIn is a great place to keep an eye on what's happening.

out with us. Trey, thank you so much for educating the audience about what prepper lunches I'm excited for your guys's growth to our listeners guys, we know that you guys have got lots of choices on how you guys spend your time so we appreciate you guys spending time with us each week. When we post one of these if you guys have got guests that you guys want to have on the show, send them my way. I'd love to talk with interesting restaurant tours, interesting

technology providers. Troy thank you so much and to our listeners make it a great day.