Aspiring to cut store-level food and labor costs by an aggregate 100 basis points, or 1 percent, executives of the Taco John’s quick-service chain knew that operator pull would benefit the initiative as much as franchisor push.
Ray Lubesky, vice president of operations for Taco John’s International Inc., said the 425-unit, Cheyenne, Wyo.-based chain set out to achieve its 2011 cost-cutting goal by convening a series of 17 “Power Summits” with operations personnel from throughout the system.
GOAL: Improve or refresh the cost-management and local-store marketing skills of as many store-level management personnel at franchisee and company restaurants as possible.
SOLUTION: Stage interactive, one-day education and team-building summits in all operating territories.
“The focus of these summits was the nuts-and-bolts basics of hiring, scheduling and training to reduce labor costs and all aspects of food ordering, handling, preparation and waste cost controls at the unit level,” Lubesky said. “By taking the hands on, interactive presentations right to our franchisees’ neighborhoods and by touching the store-level operators, we were able to direct focus in all areas of these two prime cost centers.”
As a result, he said, as of early December the chain of 10 company and 415 franchised locations had already seen significant cost savings through 2011.
Lubesky said representatives of about 85 percent of the restaurants in the chain attended the franchisor-funded summits. He noted that most of the operators who did not take part hailed from restaurants on far-flung military bases.
The framework for summit sessions was a joint effort by the Taco John’s’ training department headed by Sue Livingston, director of training, and the franchise business consultants team led by Gary Yancik, director of franchise operations, Lubesky said.
During the interactive sessions, he said, operator participants were placed in work groups filled out with personnel from other franchisee organizations or corporate stores.
“All exercises were based on those work groups solving challenges, sharing ideas and working together as a team,” Lubesky explained. “This built networks between unit managers that didn't exist before so they are now continuing to work with each other and communicate to share more ideas and successes.”
He said the elimination of “old-school lectures” in favor of problem solving exercises led to a “high-energy environment.”
Each summit also included brainstorming tied to local-store marketing of Taco John’s new TJ Baja Boneless Wings products, which were so successful after their late October introduction as a limited time offer that they were recently added to the “West-Mex” chain’s core menu.
By the end of every summit, an action plan for improving food and labor management and local-store marketing was drafted for each participating restaurant. Lubesky said the chain’s franchise operations team then followed up with personnel at those units to gauge their progress.
“This approach,” he said, “made the difference between having a ‘rah-rah’ session and a solid program that has had impact in all three profit-and-loss statement line items.”