Dennis Riese, president and chief executive of multibrand foodservice company The Riese Organization, recently talked about business in New York City, where he franchises such concepts as Tim Hortons, KFC, Pizza Hut and T.G.I. Friday’s.
How is business in New York?
It’s down. But in my particular part of the business, it’s not down as much as it is in other segments. Because I have a large percentage of restaurants in locations like Times Square, Fifth Avenue and by Penn Station, I have very high traffic despite the economy. In New York City, the hotel industry and the airline industry had to discount severely to bring tourists in, and that’s been very effective. Now that they’ve paid so little to get into New York, they have more money to spend and are much more willing to spend it in a T.G.I. Friday’s than at a high-end restaurant.
Will you expand your Tim Hortons holdings?
I don’t own any exclusive territory for them, so I can’t really say what they’re planning overall for the New York market. But I do have limited rights to develop more stores in midtown Manhattan and intend to go slowly. I’ll do it one by one with their consent.
What does the brand need to grow?
It needs a fair amount of operators to contribute to an advertising co-op so it can afford advertising and compete. Right now we’re taking a wait-and-see approach with any major future investment while we analyze our current investment.
Do you conduct business differently now?
FAST FACTS HOMETOWN: New York CityEDUCATION: bachelor’s degree, New York UniversityHOBBIES: “Spending time with my family, dining out with my wife, and Giants football.”CAREER HIGHLIGHTS: managing to save the Riese Organization, which faced some serious financial problems in the 1990s; acquiring the original T.G.I. Friday’s in New York City.
HOMETOWN: New York CityEDUCATION: bachelor’s degree, New York UniversityHOBBIES: “Spending time with my family, dining out with my wife, and Giants football.”CAREER HIGHLIGHTS: managing to save the Riese Organization, which faced some serious financial problems in the 1990s; acquiring the original T.G.I. Friday’s in New York City.
The formula the Riese Organization follows these days is the most lucrative and profitable formula we’ve ever had. It’s a large departure from our past; primarily we are looking to acquire properties to put our own restaurants in. It’s very rare that I’m interested in leasing properties from other landlords. I feel like I’m making them rich on behalf of my efforts. It’s more a matter of what types of properties we’ll have an opportunity to acquire. Depending on the location and other factors, we’ll know what brands are most suitable for them.
Does fine dining still intrigue you?
Yeah, I have interest in that, but purely on an emotional level. Most fine-dining restaurants lose money or work very hard to make money. It’s not a great business model. T.G.I. Friday’s makes much more money than the average fine-dining restaurant. But I answered yes because I’ve been in the industry my entire life and think it would be very exciting to operate successfully a relatively high-quality fine-dining restaurant. If I could pull it off, it would be something to be proud of.
What’s your prediction for the future?
People have always got to eat; that’s the good thing about our business. People may be staying home more right now, but we’ll get over this. We’re not going anywhere. The industry is always going to be super-strong—it’s not going the way of GM or Chrysler. It’s a great business. I love it.