Patrick Sugrue | Crain's Washington D.C.

In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that have shaped their business philosophy.

Patrick Sugrue

Background:  

Patrick Sugrue is the president and CEO of the Philadelphia area–based Saladworks restaurant chain, which has more than 100 franchise locations in 14 states and three countries.

The Mistake:

My mistake was coming into a changed management situation thinking I could win over stakeholders with just a smile and a strategy.

As a franchisor, you put forward investment strategies and ask franchisees to invest in remodels, equipment, and so on; when I became CEO of Saladworks about two years ago, I did just that, [suggesting] my own strategy to help turn things around.

I expected quicker alignment from the franchisees, but it didn’t come. I [mentioned particular] business cases as examples of why they should do it and tried to win them over with facts, data and presentations; still, they resisted.

They were distrustful. The bulk of the franchise community was like, “I’ve seen this before. You bought the brand to put some lipstick on it and then sell it,” or “That sounds great, but I was burned the last time.” A remodel campaign that should have taken 90 days to [complete] instead took almost a-year-and-a-quarter.

That changed after we became an operator of some stores.

Be willing to make the same investment you’re asking others to make.

The Lesson:

In a new management situation, recognize how long it could take to win people over (if they were burned the last time), and be willing to make the same investment you’re asking others to make.

In the beginning, I thought being honest and demonstrating integrity was enough to build trust with the franchisees. But as a franchisor, you don’t own the stores — you own a brand, and the franchisees pay you a royalty for using that brand. So they think, “Hey, it’s easy for them to say.”

Now that we’re opening stores, [the franchisees] see us dealing with all the same things they are — from labor rates to food costs — and that’s helped us build trust. We aren’t asking people to do something we wouldn’t want to do, and we’ve seen more alignment as a result.

Had we recognized the amount of destruction the previous leadership had inflicted, and had we become a store operator earlier, I think we would have made faster progress with our initiatives.

Saladworks is on Twitter at @saladworks.

​Photo courtesy of Saladworks

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