Troy Hooper [00:00:00]:

It's so hard to succeed in the restaurant business, but it is so easy because it's formulaic. If you understand the formula, if you know the benchmarks, if you know what to do to change those numbers, it really is not as hard as most people make it because it's really hard when you don't have the information or understand it. So get the information, get the education, get the support, get other people to help you figure it out and then make the is necessary. And now you're in a much better position.

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Angelo Esposito [00:00:30]:

Welcome to Wisking It All with your host, Angelo Esposito, Co founder of WISK.ai, a food and beverage intelligence platform. We're going to be interviewing hospitality professionals around the world to really understand how they do what they do. Welcome to another episode of Wisking It All. We're joined today by Troy Hooper, the CEO of Hot Palate America. Troy, thank you for joining us today.

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Troy Hooper [00:00:58]:

Hey, thanks for having me. Angelo, always enjoyed being here.

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Angelo Esposito [00:01:02]:

It's a pleasure. It's really excited to chat with you, especially because of your breadth of knowledge and experience in the industry. So maybe to kick things off, I know you have over 30 years of experience in the hospitality management space. Love to maybe kick it off with your story. Can you tell people where you are at right now and maybe the story of how you got to Hot Palate America?

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Troy Hooper [00:01:28]:

Yeah, I'm sitting in Oxnard, California, just north of LA, and been in California since 2015, but I've been in the hospitality industry for 31 years and a few months. I was actually born into it, to be honest with you. But I started as a bus boy at the second busiest Bennegan's in America, in Miami, Florida. I'm a third generation Miami, which is a pretty rare thing.

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Angelo Esposito [00:01:53]:

It is rare. I live in Miami and I can attest I don't meet many people that are from here, which is so my.

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Troy Hooper [00:01:58]:

Grandfather was second class of University of Miami. My father was born on campus of the University of Miami at doctor's hospital. And I grew up within a bike rides distance of the, you know, grew up in Miami. My father owned construction companies, and one of the things he loved to do or specialize in was restaurants, bars and nightclubs. So he did a lot of renovation, a lot of new ownership, renovation and reconceptualization work, and he built a lot of new from ground up and converted a lot of sort of ground floor retail space as well. So I literally grew up on a construction site of a restaurant, bar and nightclub. I thought I wanted to be an architect. Because of that, I thought I wanted to design and build and create these things, but life had other options for me.

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Troy Hooper [00:02:42]:

I became a chef. I went to culinary school at 17, worked in kitchens and cooked for six years. I became a sous chef of a finer dining italian concept and then just realized getting pans thrown at me and getting yelled at and all that. By the way, this is back in the little different, but yeah, basically been in the industry since I was a kid and just fell in love with it. Went to business school, kind of really wanted to follow the entrepreneur path. Nobody in my family had ever had a regular job. I come from a family of entrepreneurs for generations and across all the kids and all the grandkids and all that, everybody seemed to be an entrepreneur or go in the military, so I wasn't going to go in the military, so I had to become an entrepreneur, apparently. But I did my time in corporate.

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Troy Hooper [00:03:31]:

I spent a lot of time in fine dining, restaurants in the management ladder and got into fine hotels and restaurants within fine hotels. So I did a big chunk of my career in that space, which is great, really formative and foundational for management and leadership and understanding the guest and really catering to the guests at the highest level. So that's how I got down the road. But you asked at the end how did I get to hot palette? I did a podcast. The answer is ultimately I did a podcast. That podcast led to a conversation which led to an introduction, which led to an invitation to join this group. So content is king, right? But somebody found out about me, got to know me a little bit. And then when somebody asked them for some help franchising a brand, which is pepper lunch, which is the shirt I'm wearing, they asked me if I could come on board and help them reestablish the brand and start a growth plan and strategic growth plan for the brand not only in North America, but as we look to expand globally and it's a great opportunity.

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Troy Hooper [00:04:37]:

I'm really excited. Love the brand and happy to be here.

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Angelo Esposito [00:04:40]:

That's awesome. And I'd love to understand the journey because checking out, obviously your previous history, I know there was the Kiwi restaurant concept or Kiwi not concept, the Kiwi, I guess consulting is it. I don't want to butcher the name.

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Troy Hooper [00:04:55]:

Yeah. Kiwi Restaurant Partners is a consulting company. It's actually how we ended up at Pepper lunch. It's an emerging brand consulting company. So we help emerging brands establish themselves, get themselves ready for scale and whether that's corporate growth or franchise growth, about 80% of our clients are going down the franchise model, but most of our clients are actually private equity and venture capital who've made an investment and don't have an on team expertise in the space. And so they look outsourced to find a group that can help take care of the growth model. So that's what our consulting business does. And Hotpalot actually engaged Kiwi first, actually asked us to come on and establish a strategic plan and a budget, a three year budget, and say, what would it look like to grow this brand in North America? And then as a part of that engagement, part of that getting to know you process, they ultimately asked me to come on and be CEO and be the face of the brand and help the executive team establish what the future of this brand can be, not only here in North America, but globally.

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Troy Hooper [00:06:04]:

And I was happy to do that. I haven't outsourced myself in seven years. I've always been in the background supporting our team who goes out and helps emerging franchise or restaurant brands. But that business is still there. My partner Mark runs that business for us. We have a couple of clients still, but we're really focused 110% on the largest client we have, which is pepper lunch, and of course, me being embedded and then the rest of the team supporting has been a great model for us.

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Angelo Esposito [00:06:33]:

I love that. And so I can imagine 31 years, right? I have 30, but 31 years of experience in this space. We have a lot of restauranteurs and restaurant adjacent listeners, whether it's managers or bus boys or bartenders, you name it, a lot of industry people kind of listening. And so I'd love to understand kind of through your experience, what's the kind of process you typically look at when dealing with some of these brands? Like you go in, what do you do day one? Are you looking at that PNL? What are you doing to say, okay, let's get a benchmark? And how are we going to improve this? I'd love to understand a bit of the strategy you kind of typically walk through.

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Troy Hooper [00:07:12]:

Yeah, we have a really specific, pretty prescribed process. We are very nimble and agile and flexible, but at the same time, we know what we need to know. We know what they need to know. And it's really about figuring out where is everybody on the spectrum of understanding. And so for us, we spend about 45 to 60 days anytime somebody asks for help and to really look deep. And I say deep, I mean, under every rug and every closet and every dirty pantry or whatever it is, we are looking for all of the information to say, who are you? What are you? How did you get here? Where do you want to go? And sort of create that map, create that outline, that framework that says, okay, now let's figure out what your team experience and knowledge and skill set is. Let's look at this concept, let's look at the workflow, let's look at the product, let's look at the ingredients, look at the pricing. There's just no stone unturned.

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Troy Hooper [00:08:04]:

So we spent about 45, 60 days really doing a very deep dive into the brand and the team and the history and understanding. What is it that it is today and where are the gaps? What's missing? What do they need to know? What processes do they need inserted? What documents are they missing? Can we help them? And certainly we can always help them on things like supply chain and product innovation and menu adaptation, and certainly menu engineering and inventory management, all those kind of things. Kind of easy, right? But we really are looking at what is the future of this brand? How can this brand replicate itself, and what does it need to look like, feel like, sound like, taste like, et cetera? So we do that process and then we establish a strategic plan and we say, okay, to get where you want to go, 50 stores, 100 stores, you want to franchise, 1000 stores, you want to own ten more corporate stores. It doesn't matter what the goal is based on what you have and what the goal is. What is the path? We basically reverse engineer from the goal back one brick, one step, one task at a time to today, and we say, okay, here's the map, here's the roadmap. It's going to take this long, this many people, this level, these types of people. What are the gaps of humans you need? Who do we need to go get for you or bring to the table as a fractional or temporary or full time resource? And we map that out. And basically the brand, founder, operating team investor makes the investment into that organization and says, okay, I buy into the vision, I buy into the plan, let's go.

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Troy Hooper [00:09:36]:

And then what we do is we embed ourselves. We provide an outsourced c suite. And so we're basically fractional across until we're completely not fractional, right? We provide enough fractional support that you have everything you need on team, and we stick with you until we've got you in a position to achieve that goal without us. And so it's really introspection, short, mid and long term planning, strategic expenditure and budgeting. And then do we have the people? And we bring the people, the resources, the vendors, the products, the technology, whatever it is, needs to be brought to the table to achieve that goal. We bring all of that because we have experience, relationship and economies of scale that we can bring to the table to benefit you and we help get you from where you are to where you want to go faster than we think, faster than anybody else, more efficient than anybody else, and certainly at a lower cost because you have the opportunity costs, you have the lost costs of time and expending and hiring things that don't work or cost too much money or those kinds of things. So we're really just making the engine really efficient and faster and more productive at the end of the day.

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Angelo Esposito [00:10:50]:

That's awesome. And do you find, generally speaking, I know you mentioned franchise and you mentioned restaurant brands. Do you ever work with single locations or typically you guys find a certain minimum number of, let's say, restaurants is your sweet spot?

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Troy Hooper [00:11:02]:

No, definitely. Look, it comes down to mindset and financial resources, right? Are you in a position to fund the growth of this business, whatever that means? And most people think, oh, well, franchising, look, a lot of people get sold the idea like six, seven years ago, I would have been the first one to tell you franchising is disgusting and scummy and full of second used car salesmen and all this kind of stuff. Right? It's actually why we built KRP is because there were very few people in the industry that were doing this with high moral and ethic and really seeing it through. Right. But there's a real cost to building a franchise, infrastructure and business and team, and it's a different business. First question I ask people when they say, hey, Troy, we think we've got a great concept, we've got a great team. We know people want this in more places. We want to grow.

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Troy Hooper [00:11:50]:

We can't afford to build 1020 30 corporate stores, so we want a franchise. And the first question I ask them is, are you ready to stop running the business that you run today, stop being a restauranteur and are you ready to start providing to operate a service business? Because people are going to pay you money and you're going to owe them products and services, deliverables, and on a daily basis for the rest of your life, they're going to pay you in the form of royalties to receive your experience, expertise, assets and ongoing innovations. And that is your new job. You now work for them. Are you ready to do that? Is that something you want to do? And if the answer is, wow, yeah, I've been running my restaurants for 30 years. I'm really ready to teach and train and support and show other people how to do this. And I'd love to see my name and product replicated out there in the industry. Great.

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Troy Hooper [00:12:44]:

Then let's have a conversation about next steps. But it just comes down to mindset and resources. If you have the right mindset to be a franchiseor and you understand what that means and you have the resources to get it off the ground, look, it takes between two and three years to hit break even in building out a franchise infrastructure. So if you can fund the next three years and you can do what it takes to get that cohort of franchisees to sign on with you in that time frame, then it can become a self sustaining business. But most people are sold. Hey, 65,030, 5020, 5000. You'll get all the doc. Look, they're handing you a book off the shelf.

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Troy Hooper [00:13:21]:

Go to Barnes and Noble and buy franchising for dummies. That's what they're selling you. So don't get caught up in that. Understand that there's a lot more to it and you just need people. And, look, we're not the only one. We're very specific. We're very specialized. Have we worked with single unit concepts? Absolutely.

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Troy Hooper [00:13:39]:

You can find a single unit person who's created a really cool thing. Look, Chipotle was one restaurant store once, right, as everybody else was. So nobody walked out the door day one and built ten or 20 of something. We really think that it's not about the store count. It's really about the founder operator, the mindset. And are they ready and do they have the resources to create the growth that makes sense.

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Angelo Esposito [00:14:05]:

And have you seen, like, I imagine most people who want to become franchisors probably have to maybe prove out more than one store. Have you ever seen cases where people go from one store to franchising? Or generally they kind of got to get at least a few and show that they can kind of repeat it. I'm curious because I have some franchise.

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Troy Hooper [00:14:24]:

I have to be very careful here. I don't want to use absolutes. The answer is yes. It's happened because pepper lunch franchised to the Suntori group after store one. Now, that was 1994. Absolutely. Is it possible to have such a home run in a single unit? Look, anybody can sell ice to an eskimo. At the end of the day, anybody can convince another human that they've got the next great thing and that they should franchise.

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Troy Hooper [00:14:50]:

Is that the right thing for you? Probably not. Okay, more often than not. That creates a lot of stress and friction. You as a franchiseor, really don't have the experience. I mean, it happens, but data, yeah. Sample size of one, like I said, not absolutes. But what I would tell people, what we always tell people is, ideally you have a minimum of three, up to five, between three and five stores. They can be in the exact same region, but they need to be across different demographic markets, right? So if you're in Los Angeles, you have all of the availability, you have socioeconomic, you have ethnic, you have mixed, you have affluence versus, you have all these measurements.

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Troy Hooper [00:15:37]:

And. Absolutely, in the Los Angeles area with 10 million people, you can certainly prove that this concept works in different areas, right? Totally get it. In most places, you kind of are going to stretch out to the greater rounder metropolis. You need a true suburban, a true urban, maybe a hyper urban. Do you have a traditional and nontraditional and inline and a freestanding, I don't know. Depends on your concept. But you usually want to have proof that you've done this three times, and you've done it in three micro markets, no matter how close or far they are from each other. The demographics are different, that this will fit and people of different types of lifestyle will patronize you to the volume to make those businesses independently successful.

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Troy Hooper [00:16:22]:

And so the other thing that does for you is if you have three to five stores, you now start to understand what supporting scale looks like on a micro level. But one store is really easy for, I mean, I can run five to ten myself, right? One store is pretty darn easy for a founder or a couple. But you start getting to three, five stores. Now you're having to prove that you can support other people, you can promote people, you can have leadership qualities, right? So you're starting to show that. The reality is, the reason we say three to five stores is to successfully sell a franchise to anybody who knows what they're looking at from a restaurant perspective, they're going to want to know that you've done this once, more than once. They're going to want to know that you can support multiple stores and that you can show leadership and structure. Because once you get to three to five stores, you have to have some systems, some processes, some checks and balances. You have to be working on your business, not in your business as much.

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Troy Hooper [00:17:21]:

And that shows me as a franchisee, the things I need to know about you. So it has a lot of implications and benefits. But of course it happens. Of course you could franchise at one store, look, 250 or so franchise businesses, about 60% to 70% of that 250 are restaurant concepts, are registered in the United States every year. Did you know that? About 250 don't renew their registration every year. So it's almost 100% turnover rate on the number of new people becoming a franchiseor and then number of franchiseors closing their doors as far as not paying to re register in the United States. So it's not an easy business.

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Angelo Esposito [00:18:05]:

An interesting stat. I did not know that.

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Troy Hooper [00:18:07]:

And it's been consistent for at least a decade.

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Angelo Esposito [00:18:10]:

Wow.

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Troy Hooper [00:18:11]:

And again, that's all industry. But restaurants make up around 60 or so percent of the franchise businesses being registered in the United States. So it's heavy, heavy, heavy restaurant.

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Angelo Esposito [00:18:20]:

I love that. That's crazy that when you think of those numbers, I mean, on the west side, we obviously help restaurants with the cogs side of things, cost of goods sold. So generally we look at it very operationally. We think about prime costs. You got labor, you got cogs. We really focus on the cog side. Food, beverage inventory, invoice management, recipe cost, et cetera. So for me, my brain always goes there when I think about how much opportunity there is.

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Angelo Esposito [00:18:45]:

But obviously you're way more broad and you think about the full spectrum from marketing to branding to you name it, hiring, everything. Yeah, everything. Right. So I'd love to hear. Obviously you're not going to share everything. We only got a certain amount of time, but just to maybe give people a little taste of some of the ways maybe restaurants can think of improving, let's say, their business. Right. And I know really the real value is if they hire you.

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Angelo Esposito [00:19:12]:

But at a high level, we have a lot of listeners that are maybe like, what can I do? I don't want to say easy because nothing is easy, but what are some things people can look at if they're running a restaurant and they're maybe looking to improve operations, improve with their bottom line, you have ton of experience. Can you share a couple of nuggets that maybe they can think about?

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Troy Hooper [00:19:30]:

Yeah, absolutely. We do this when we secret shop the restaurant, right. We do this when we get in there on day one before we've really seen or done anything. Now of course we get the PNLs right away. But to your point, number one, you have to know your numbers. And when I say know your numbers, not know what the number is, know why the number is what it is. Okay, first of all, you need to know what the number is. We do walk into a lot of restaurants and they don't necessarily know what the number is.

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Troy Hooper [00:20:01]:

And if we challenge that number, then they don't know how that number got there, right? So what is the number? Why is the number what it is? That is a self internal education. You can absolutely get help. There's tons of consultants, coaches, all kinds of ways. Look, you can go down the SBDC, the small business development center, at your local college or university in every city in America, and there are people like me who volunteer their time, and they'll walk you through A-P-L they'll walk you through your inventory. They'll help you understand where the number is coming from. Because just pushing a budding in a report out of your point of sale or your accounting management system, like restaurant 365 or something, or WISK, provides these insights and these analytics, whatever that is. Knowing what the number is makes no difference if you don't know how to change it. And so you have to know what to do to change it.

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Troy Hooper [00:20:58]:

And what should it be? By the way, if you're in QSR, vast casual, do you have a drive through? What's your delivery? Off premise percentage?

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Angelo Esposito [00:21:07]:

What's a good benchmark?

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Troy Hooper [00:21:08]:

Right? What are the benchmarks? What should your number be? So, that's the hardest part. I'm telling you that most restaurant companies don't know how to deal with that and what to do. And so that's a big, big part of it. Look, labor is the number one variable, expense that you can control, right? Scheduling, set and forget the schedule. Know what formula works and why. Why do you have three people coming in two to 3 hours before your store opens? Do you need six or nine man hours to prep? Do you really? Or can two people do it in four? Ask yourself that. Try it. Press your team to step up.

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Troy Hooper [00:21:51]:

Right. Obviously, inventory. Obviously. I'd say most restaurant tours under ten units don't understand the opportunity to negotiate their supply chain and to get economies of scale to really affect that and to use loyalty to your distributors and manufacturers and service suppliers to reduce your costs. There's a lot of fine tuning and tweaking in those numbers, and you just go line by line. What can I do to change this number for the better? Lower for this, higher for that? How do I change that? And my answer for everything in this podcast and every day of my get help. I don't care if you join the Lions Club and there's a fellow restaurant tour, or you go to a restaurant industry event, you go to a conference, and you make friends around the lunch table, but get help. Hire a consultant, hire a coach, ask somebody to come in and take a look outside perspective.

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Troy Hooper [00:22:53]:

Look, when you're in the bubble, you're in the bubble and you can't see everything, let somebody at least tell you from the outside what they see, and then open your eyes, and then maybe you have an opportunity to affect it. But then if you don't know what to do, ask for help. It's so hard to succeed in the restaurant business, but it is so easy because it's formulaic. If you understand the formula, if you know the benchmarks, if you know what to do to change those numbers, it really is not as hard as most people make it, because it's really hard when you don't have the information or understand it. So get the information, get the education, get the support, get other people to help you figure it out, and then make the changes necessary. And now you're in a much better position.

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Angelo Esposito [00:23:34]:

Yeah, it's well said because it makes me think about that whole saying of is what I know is what I don't know. And then this is what I don't know that I don't know. And it's like asking for help, for whatever reason. I think it's tough for humans in general, like just asking for help. But in the restaurant industry, I have noticed even myself, there is a bit of that. It seems more common. People don't ask for help enough. They do kind of work in silos.

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Angelo Esposito [00:23:57]:

There's so much you could learn from peers, but it seems like it's a bit blocked off and you struggle and you don't go for that outside help. So I think that's a good theme for people listening.

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Troy Hooper [00:24:10]:

Very few people walk out of their job at McKenzie, Ernst Young or off of Wall street and open a restaurant. So the reality is most restaurant tours are not finance managers, right? And that's totally understandable. But you're running a business, your livelihood depends on it. More importantly, your employees livelihood depends on it. The stakes are really high. Do what it takes to learn the process and learn the systems and learn how to run your business most efficiently and effectively. And my God, there's so much free information. How many of these podcasts could you listen to? How many other podcasts could you listen to? How many YouTube videos could you watch? Right? How many people on LinkedIn or other places could you follow that every day? Are literally just dropping the answers to the questions.

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Troy Hooper [00:24:57]:

The answers to the test are out there for free, just floating. You just got to grab them and ultimately bringing it all together. Like we said, there's so many free resources and so many people that want to help and that have done it, if you see a successful person have done it, ask them. They most likely want to share their knowledge and experience with you to make it better for you.

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Angelo Esposito [00:25:18]:

Yeah, it's funny you nailed it because it's tied back to the vision behind WISK. I started WISK in end of 2014, so it's been almost ten years. And I remember when I started, it was simple mission. It was just to give restaurant tours their time back. Because what I saw time and time again in the beginning was mostly friends, but then that circle evolved. But it was like, they love the hospitality space, they love the idea of guest experience. If they're on the food side, maybe, the culinary side, maybe, but architecture design, it was like a lot of artistic stuff and guest experience. And then it's like they get into it, and I kind of realize, holy crap, I need to do all these things like providing a PNL report and recipe costing, and it's so important, it kind of sucks.

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Angelo Esposito [00:26:00]:

And it's a bit tedious, but it's like inventory, things like that, but it's so important. And so that was the idea. How do we give them their time back? By speeding those things up so they can actually focus on those other things. But having said that, one of the things that I noticed when I started working with a lot of restaurants with WISK is how common it was that people didn't really have a Fully Fledged p l, which I found Crazy. But then I realized it's kind of the norm. So I'd love to know, from your point of view, when you deal with people, how common is it that, like you said, number one is having the numbers, how common is it that their numbers are either, like, half baked or just they don't really have the numbers?

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Troy Hooper [00:26:36]:

Pretty often. Pretty often. Look, every P l has an opportunity, really getting it structured and understanding where the numbers are coming from. The accuracy of the data is one of the more problematic areas. Is right information being put in the right place? Is the same information being put in the same place every month. That's another issue is that sally categorized it this way. Steve categorized it another know. One of the biggest opportunities is on the inbound invoicing and inventory.

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Troy Hooper [00:27:14]:

Really, really having your inventory nailed down. And when something gets substituted or you try another vendor, you buy the same sort of thing from another vendor, cross matching those again so they represent in the right place. In the same place. That's a lot of freaking work. That is a bookkeeper's full time job. And if your bookkeeper is not in your business and understands the difference between this pasta and that pasta, this purveyor and that purveyor, paying attention to a case equals x at one company and a case equals y at another company, these are things that you've got to break it down to the smallest measurement, and this is just my system in my way. But if you're not breaking it down to the smallest measurement, so that everything is measured the same way at the individual portion level, so to speak, at the raw and at the rendered product, then you really don't know what you're paying, you really don't know what it costs, and therefore, you really don't know what it should be priced at. So, inbound, back of house inventory management, invoice management, proper categorization, huge opportunity, menu pricing, menu engineering and menu pricing.

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Troy Hooper [00:28:29]:

Look, I've never walked into a restaurant that the sales mix didn't tell me to take a percentage of the menu items off the menu, right? And most of those menu items included one or single use ingredients, right?

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Angelo Esposito [00:28:44]:

Oh, wow.

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Troy Hooper [00:28:44]:

And so how much prep can we save you? How much inventory waste can we save you? How much holding cost can we save you? These are very simple, but pretty complex compound. Yeah, they compound and they compound every day. And waste is a big issue. Right? Are you measuring shrinkage? Are you measuring waste? Are you accounting for and writing off shrinkage and waste? If you change the raw product coming in the back door, can you buy something par baked or par cooked or commissary style, pre sliced and diced? Does that make sense? Sometimes it does, sometimes it doesn't. Right? French fries maybe? French fries, maybe not. So, depends on your business and what your product you're trying to deliver at the end of the day is. But man, that's just what we just talked for 3 minutes. Imagine that.

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Troy Hooper [00:29:37]:

45 days, 50 menu items, 500 ingredients, right? Imagine answering that question for every single thing. But once you've done it, it's done. And so changing item, buying a new item, adding a menu item, taking off menu item, becomes really easy and really data driven once you've got the system in place.

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Angelo Esposito [00:30:00]:

Yeah, I love that. It's funny you mentioned the kind of buying same item from different suppliers. On the technical side, that was one thing when we were, because WISK real quick, nugget. We started off in the early days and was really beverage focused. So bar inventory, bar management. Then over the years, a lot of full service restaurants we work with are like, please, please do food. So we finally launched food, and now it's f and b. But on the food side, one of the challenges, we solved it now, but it was exactly that.

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Angelo Esposito [00:30:25]:

It was like people would come from maybe trying different systems and say, oh, I was using this other system, and now the problem is I have like 17 versions of this tomato, but I just make tomato sauce. We came up with exactly what you mentioned, but it's that concept of what we call item variation. But it could be tomato a, tomato b, tomato c, which have different costs, maybe different size, different cases, but sometimes they use it interchangeably in a recipe. So there's so many nuances, like you mentioned, that kind of go deep, but at a high level, I'd love to maybe just touch on. I find menu engineering super fascinating. Do you have any quick nuggets you can share there? Because I think sometimes you look at a menu, there's a lot of tips on, do you put images, do you not? You add dollar signs, do you not? There's a lot of that side, maybe the visual places, like maybe a cheesecake factory that spend a lot of r and d on their 50 page manual menu. But I'd love to hear anything you can share. Again, I know that there's only so much you can share because your process is 45 to 60 days.

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Angelo Esposito [00:31:28]:

So there's a lot of high level.

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Troy Hooper [00:31:33]:

So high level is people specialize in menge engineering. We hire it out. We have people on our team or off team. It's a big deal. Look, there's a lot of data out there. And so here's where I would start. The most important place to start is this. Who is your customer? Do you actually know who your customer is? And how many segments does your customer break out into? We call them avatars.

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Troy Hooper [00:31:59]:

Right? How many different personalities are there? How many different types? Family of four. Both parents work retired, one person works, blah, blah, blah. Break down your customer into the biggest but most specific buckets you can. And who is your customer? The reason I say this, is this what you're going to offer and how much you're going to charge and how big those portions are and whether they're salty or not salty. These are all questions that get answered by understanding who your customer is. And if you don't take the time to really deeply, deeply understand who your customer is, then you're just guessing. And you're guessing with your money. You're making products that people may or may not purchase, and you don't know whether they want them or not.

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Troy Hooper [00:32:46]:

So to figure out if they want what you're making. You shouldn't wait for sales reports to tell you if they bought it. You should know before you decide to put it on the menu that it belongs on the menu because you have people who want it. And so that's the question to ask. That's the really difficult one to answer. Now, at a high level, there are companies you can pay in the restaurant industry, data companies that specialize in providing you menu detail. They literally have the menu and the sales data for every restaurant in the world, basically between two or three of them. So who are you? What category are you in? What kind of food do you have? Who's your competitors? Up ladder.

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Troy Hooper [00:33:30]:

Down ladder, direct competitors? Who are the customers they serve? Are they different? Are they serving the same food but getting a totally different customer base? Why? Is it their price? Is it their portion size? Is it the variety? Is it the simplicity of the menu? You want to be the chipotle of something. Look at Chipotle's menu, right? Things, 15 items max. So you walk in the door with 55 menu items. I had one the other day, sent me their sales mix report. 112 menu items. Right? Do you have that many different people that want that many things? Because I'll tell you what I order at every restaurant, one or two things from every brand. I know what I want when I show up to the brand. Now, I'm a unique.

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Troy Hooper [00:34:14]:

I know there's people like me, but I'm one avatar.

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Angelo Esposito [00:34:16]:

I'm similar to that, too.

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Troy Hooper [00:34:17]:

Yeah. Right? I find the two or three things I like at the restaurant, I might interchange one or two of them. But basically, I get the roast beef dip at lazy dog, and if I'm not that hungry, I get the wings. That's it. So everybody's like that in a lot of ways. So understanding who your guest is, what they want, what they want to pay for that, what portion equals value? So it's the value proposition equation, right? You have to understand what that is. And when you can solve the value proposition equation for each one of those customer segments, or avatars, now you're much closer to providing what it is they want. And then ask them.

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Troy Hooper [00:34:57]:

The thing I'll leave you with is don't guess. Ask them. Ask your community. Ask your existing customers. Ask your prospective customers. Are you even opening a store in the right neighborhood? Are there enough of the customer that you want and need to keep your business supported? Do they exist? Are they even there? So just because the rent is cheap doesn't mean it's a good location. So, yeah, these are the high level starting point. And I always start with the customer first.

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Angelo Esposito [00:35:26]:

That makes sense. And for people that maybe want to get their feet wet, it sounds like obviously this is quite intense work, but maybe to get their feet wet and thinking about. Because I think just the fact that you mentioned, hey, understanding your customer avatar, there's probably listeners that are like, who is my avatar? What would be maybe a good first step to start thinking about that, right? Like, if you're a restaurant, how would you go about maybe starting to think? And maybe there's services, maybe there's online graphic data. What would be maybe a good first step that the average restaurant can take to at least go a little deeper on who is my client.

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Troy Hooper [00:36:00]:

Look, ultimately you can pay $30 to $230,000 to a branding agency who will do the work with and for you, the answer is have a notebook or an iPad or whatever. Have a way to take notes. Stand in your dining room, your bar, your restaurant, and just like you see people standing on the corner counting cars, by the way, they're not just counting cars, they're counting the car, the type of car, the direction it's going, the speed it's going, how many humans they can see in the car when it goes by. So do that for your restaurant. Take a survey. Take a real survey. Do it for seven days. Look, I go to the same place every Tuesday, Thursday.

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Troy Hooper [00:36:43]:

Seven. Right? It's pretty consistent. So maybe do it for one week, maybe do it for two. But if you do it seven days, from the moment you open to the moment you close, if you stand there and you take in notes, okay, family of four, right? Hispanic mom and dad, boy and girl. And you just start a very big spreadsheet. This will get wide really quick. But with a spreadsheet, you can sort and organize and collate that, right?

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Angelo Esposito [00:37:10]:

Right.

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Troy Hooper [00:37:11]:

What percentage is over 55? And these are generic buckets. But how many groups of students come from the nearby college? What day do they come? What time do they come? How many are in that group? These things. This sounds really big. The answer is, if you just stand there for a week or two, it becomes very clear. You see the patterns. You start to see the buckets. Now, this goes down to about four avatars, okay? We've got these kind of people that come from four to six. These kind of people from six to eight.

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Troy Hooper [00:37:45]:

We've got a lull from eight to nine, but we've got the late night crowd that packs the bar at 930. Blah blah blah, right. And then go to other restaurants and do the same thing. Who's your competitor? Just go sit at the bar or sit in the restaurant where you can watch the front door and just quietly take notes in your head of, okay, my competitors guests look like this.

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Angelo Esposito [00:38:04]:

Wow.

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Troy Hooper [00:38:05]:

They get a bunch of this kind of guests that I don't get. Why is that? Oh, they have a happy hour from nine to eleven. So they're getting late night hospitality workers or people getting off from the hospital that's nearby. They get off at 07:00 or 09:00 or 10:00 right. Hospital nurses get off at 10:00 p.m. They're hungry. Right. They come by for a snack and a drink.

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Troy Hooper [00:38:27]:

They might be drinking coffee, but they come by. So that's where you start to understand who they are. Then you ask them, that's great. Then you put a group together and you do what's called a focus group. And you don't need a big focus group marketing company to charge you $50,000 for this either. You just walk up to the table and say, hey, my name is Troy. I've seen you in here a few times. I'd love to ask you a little bit about your experience.

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Troy Hooper [00:38:52]:

We're just trying to make sure we're serving the right things and that you're getting the experience you want. We want to make this the best place for you. Right. Would you mind if I bought you a meal? If I gave you a $50 gift card, $100 gift card, if I gave you a Starbucks or a target gift card? Doesn't matter what it is, right? Would you give me an hour of your time? I want to put a group together of folks that come in here and I want to ask a handful of questions and definitely buy you food, definitely reward you, want to make it worth your time. But I'd really love your feedback. Most people want to give you their feedback. And if you make me feel special and go, hey, you're important enough, I notice you, I see you. I want your opinion.

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Troy Hooper [00:39:33]:

Will you help me help my business? I'd say nine out of ten people are going to say yes. Hell, for the free meal, they'll say yes, right?

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Angelo Esposito [00:39:40]:

Agreed.

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Troy Hooper [00:39:40]:

Yeah. And then sit them down and ask the meaningful questions that matter to you.

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Angelo Esposito [00:39:44]:

That's great advice. I love it. And then I guess there's maybe one more theme and then I'd love to. I think you're dropping so much good knowledge. So I also want to just make sure we plug how people can find you, where they can find you, how they can learn more about your services and then even know how much you can disclose. But even to learn a bit about pepper lunch specifically, I think could be cool. But before jumping to that one theme, I'd just love to talk about, because we spoke a bit operational, a bit labor, so we're touching a bit of cost of goods. So we're touching a bit of themes.

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Angelo Esposito [00:40:12]:

Menu mix, one last theme, because it's a big one. So I'm not expecting to go super deep, but again, you've been dropping so much knowledge, I got to at least touch this topic is, can you maybe share some things? You see, I always hear restaurants kind of complaining about, I just need to get more people in the door. So the theme of maybe marketing, how do you get, and I know that's a very broad things to say, marketing, but anything you can share on that side of things, because it's one of the most common things I hear from restaurants. Our food is great. This is great. Just not enough people know about us. What kind of general knowledge can you share on that front?

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Troy Hooper [00:40:46]:

Yeah, look, restaurants do about 1% to 2% of the marketing they should do. Like, at the end of the day, it's a pretty competitive space. Like, go drive down the street, three blocks in all directions, and count how many restaurants there are. Right? People have choice. I mean, come on and build it, and they will come. That was in 1980. The world is fast paced. People are making decisions very quickly.

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Troy Hooper [00:41:11]:

Decisions are different every day for different reasons. Whether I drive down the street to Chickfila or I ordered it to my house today, I paid $24 for breakfast when it would have cost me, I think it's 895. If I had driven up there, but I didn't have time. I had to get on my podcast with Angelo.

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Angelo Esposito [00:41:30]:

Thanks. I just got to say one thing for people listening, because we also have the audio version on Spotify, apple, et cetera. So if you're not watching the video version, I want you to know Troy just whipped out a cup from chickfila. That was awesome timing.

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Troy Hooper [00:41:44]:

You've got to be good at telling your story. You've got to understand modern marketing. And from that perspective, I don't mean algorithms and I don't mean spend. Digital marketing on social media is free. All you have to do is do a lot of it consistently, and you need to be very transparent and tell your story. People buy from people. People don't buy from menus. I don't go to lazy dog for the menu.

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Troy Hooper [00:42:08]:

I go to lazy dog because of where it is, how long it takes. Everything's predictable for me. I know where it is. I know how fast to get in and out, where to park, how much it's going to cost me, how long it's going to take. I know the quality and level of service I'm generally going to get. I know the portion size that's going to satisfy me. I know I can take my son and stick him in a booth and corral my three year old so he's not running all over the store. I know they have food for him.

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Troy Hooper [00:42:34]:

I know it. I know it in and out. So that's why it's easy, right? So you have to convey to the consumer who you are, what you do, why you do it that way. Peel back the curtain, explain, and it's all free. The answer is social media, because that's the free starting point. Right? Are there analog things? Are there neighborhood community things? Of course. Get out in the community, join the chamber of Commerce, go to the networking events, do all the old fun things, hand out free coupons. By the way, this is something that was used to get Done every day and hasn't.

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Troy Hooper [00:43:06]:

Eighty s and ninety s, definitely. MAybe early 2000s. Somewhere along the way, we stopped giving away food. You know that Jersey Mikes will tell you. The founder of Jersey Mike's will tell you that the most important marketing tool they have after their employees. Their employees are. Their number one marketing tool is their employees telling other people about their food. And their restaurant is giving out a free Sandwich, like making sandwich boxes and taking them to the little League, taking them to the networking event, the Business.

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Angelo Esposito [00:43:33]:

I didn't know that.

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Troy Hooper [00:43:34]:

Right. If people taste your food, they're more likely to want to come in and try more of it. So keep in mind, we're talking about cogs. If you know what a menu item costs you, you know what it actually costs you to give it away? Giving out a $50 gift card is not giving out $50 from your pocket. Right. It's giving out what it costs to produce $50 worth of food in Your restaurant. Give it away. I have what's called free on me cards.

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Troy Hooper [00:44:01]:

I don't have any in front of me, but free on me cards. One of our franchisees is a habit burger franchisee of multiple locations. He carries around a stack. He gave me 100 of these cards. They're worth $6.29 because if you watch him scan it, it comes up on the register. 629 free hamburger. It's a free char burger at Habit Burger. Do you know how many of those I've given out.

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Troy Hooper [00:44:24]:

I'll never eat 100 char burgers in any reasonable amount of time, so I give them out. So now all kinds of people are going in and trying habit burger because Troy's giving out this guy's free food card. So marketing is your responsibility. Nobody's going to tell you. My friend Shawn Walchef has always said.

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Angelo Esposito [00:44:41]:

He's going to say, Shawn, nobody's coming.

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Troy Hooper [00:44:43]:

To tell your story. Right? Tell your story. It's free. By the way, you don't have to get on the camera. You can have Susie, the server who loves this stuff, be your TikTok person and they can go around and put the camera in front of your face, your chef's face, nobody's face. Employees face, customers face. No face is required. They can just produce content for awareness and it just has to be done consistently.

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Troy Hooper [00:45:12]:

But I would say this. All staff meeting. Hey, everybody. Who in here has more than 1000 TikTok followers? Great. What do you talk about on TikTok? Oh, man, I do this Star Wars Lego thing, blah, blah, blah. I create cinematic letter. Oh, that's really cool. You're a very creative person.

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Troy Hooper [00:45:31]:

Could you do something like that for our restaurant? Yeah, I would love it. There's nobody more invested in the success of your restaurant than the employees who are getting paid by you, who want to be there because they chose you over all the other restaurants they could work for. So use your employees. Use your customers. You probably have customers that are in the business of creating marketing and print materials and digital advertising and Google search optimization. Come on, you don't have to learn it. You don't have to do it yourself. Ask and invite people to be empowered to help you.

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Angelo Esposito [00:46:04]:

I love that. I love that. And Sean. Yeah. Shout out to Sean because he really does a great job with this. But I think it's something that has to be said more because a lot of restauranteurs often think, ah, I don't know anything on social media or what kind of content. But one of his lines that I love is just like, be the show, not the commercial. And I think that gives restaurants the permission to be like, don't overthink how you're going to make this cinematic thing of a chef cooking this plate and the finished version that you spend two weeks and it's a 1 minute clip.

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Angelo Esposito [00:46:33]:

Instead, the content is the show. Behind the scenes. What you're doing new staff, you're putting up a new sign, like film someone doing that, just what you're doing day to day becomes the content. And the truth is, it'll suck and then it'll get better as you do more. So it's like you need to go through sucky content and then it gets better and better, but there's no shortcut. And so I always like to share that, too. It's like, just start. Even if you don't know what to pose, start.

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Angelo Esposito [00:46:56]:

And no matter what you'll get doesn't matter. Better. Yeah.

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Troy Hooper [00:46:59]:

You're doing it and nobody else is. Or you're doing it and your neighbor competitor is not. I mean, at the end of the day. But here's the reality. I'll give a free one. Sure. User generated content is free. What is user generated content? Your guests and or your employees are producing content inside your restaurant about your food.

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Troy Hooper [00:47:20]:

Okay. They're doing.

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Angelo Esposito [00:47:22]:

Yep.

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Troy Hooper [00:47:23]:

Hashtag my restaurant name. Search my restaurant name on Instagram, Facebook, TikTok, whatever. Search the name of your restaurant and just see how many videos exist where you've been tagged and you don't even know it. Then all you have to do, and legally, you don't even have to ask. Ethically, it's the right thing to do. Dm them, message them, go into the comments and message that don't go in the comments, say, oh, my gosh. Thank you so much. That was great.

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Troy Hooper [00:47:50]:

We love what you said about us. We're so happy. Please dm us and we want to talk to you about maybe a free meal. Great. Then everybody sees your comment. That's great. But in their profile, you can message them. It says message here, right? You can dm them, message them and say, hey, Susie, really love the video you made about our food.

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Troy Hooper [00:48:09]:

Would love to use that video on our channel. Would you mind if we repost that on our channel? And Susie says, oh, my God, my restaurant that I love going to. And I create videos about it because it's so cool. Or I love, yes, I would love for you to repost my video and give me credit and use my name. That would be great. I'm now a content creator. People love it. Use it.

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Troy Hooper [00:48:31]:

It's free, user generated content. Repurpose other people's stuff they made for you.

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Angelo Esposito [00:48:37]:

That makes ton of good knowledge. I love that. And so to give a chance for you to obviously also share, people probably listen to this and taking notes. I think a lot of good knowledge being dropped. So maybe we can just wrap up, but get into the last couple of minutes on how can people find you? Where can they go? How can they maybe learn more about your services? And then I'd love to give you a bit of time to even just share a bit about pepper lunches since that's a new project.

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Troy Hooper [00:49:05]:

Yeah, I appreciate that. So I'm really easy to find. I don't know if Sean created this. We all say it in our groups, which is. I'm weirdly available on LinkedIn. J-J-I have a legal first name that's not Troy J Troy Hooper on LinkedIn. If you just google Troy Hooper Pepper lunch or Troy Hooper Kiwi, I will come up. I promise.

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Troy Hooper [00:49:28]:

Easy to find, easy to get a hold of. Feel free to DM or message or email me. Love to always give back feedback and input and resources if we can. We'd love to share what we know with everybody who needs it. As far as Pepper lunch, we've launched pepper lunch franchising in the United States. We have seven stores in North America, five in the continental United States. We've partnered with three new franchise partners that are all going to open ten stores in the next five years between Florida, Hawaii and Arizona. We are going to close a couple more deals this month.

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Troy Hooper [00:50:02]:

We have some great momentum going on. But if you are in southern California, Artesia, Alhambra, Irvine, if you go to or live or visit Las Vegas, we're 8 minutes off the Strip in Las Vegas. Please go check out pepper lunch at Shanghai Plaza. By the way, talk about UGC. Keith Lee has goes to our restaurant pretty regularly. He's mentioned Pepper lunch three times in his content. Shout out Keith Lee, we love you. And if you're in Houston, we're in the Bellevue area, what's traditionally known as the Chinatown area of Houston, currently Vancouver, BC and Guam as well.

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Troy Hooper [00:50:36]:

But we'll be coming in this year. We'll be coming to Phoenix, Tampa, Orlando, and it'll be 2025. But we'll be opening in Honolulu, Hawaii as well. But pepperlunchrestands.com, check it out. It's an experiential, fast casual DIY tepanyaki. What does that mean? We bring sizzling hot plates of raw ingredients to your table and you add your sauces and spices, mix and mingle it the way you like. It's very social and shareable. It's very content rich.

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Troy Hooper [00:51:07]:

Visually, it tastes great. The ingredients are amazing. Look, you can get in and out for $20 in under 20 minutes and get a very satiating, high quality, tasty japanese meal. It's extremely authentic. This was founded in Tokyo 30 years ago. We have 513 restaurants in 15 countries. We're in almost every asian nation on the planet and Americans and westerners love the food too. So get out and check out pepper lunch online or in person to go.

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Troy Hooper [00:51:38]:

Whatever works for you. It's a phenomenal brand.

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Angelo Esposito [00:51:41]:

That sounds delicious. I mean, definitely when you open in Florida. I'm based personally in Miami, so whenever you open any Orlando, Tampa, count me in. It sounds amazing.

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Troy Hooper [00:51:53]:

We'll get you up to Orlando or Tampa, the end of 24. We'll have a store opening in each for sure. But hey, look, if we're in Tampa, Orlando, Miami is going to be on the list here pretty quick, I'm sure. So as soon as we get a franchise partner ready to go in South Florida, we'll make that happen for you.

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Angelo Esposito [00:52:10]:

I love that. Well, you heard it here first. Troy Hooper with a ton of knowledge, ton of experience to share today. So thank you. I think our listeners are going to love this. A lot of tidbits they can actually act on, which I love not just chatting, but actual real value. So thank you for sharing all your knowledge. And then once again, you know how to find Troy Hooper online with his LinkedIn handle.

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Angelo Esposito [00:52:31]:

Or just quick google Troy Hooper. Kiwi or Troy Hooper. Any other keyword will pop up. And last but not least, make sure to check out pepperlunches.com.

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Troy Hooper [00:52:42]:

Pepperlunchrestants.com.

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Angelo Esposito [00:52:44]:

Yeah, restaurants, my bad. So pepperlunchrestants.com. There you go. Troy, it was a pleasure having you on the show. Thank you for being here and sharing all your knowledge.

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Troy Hooper [00:52:53]:

Thanks, Angelo. It was a great pleasure. A lot of fun, beautiful.

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Angelo Esposito [00:52:56]:

Feel free to check out WISK.AI for more resources and schedule a demo with one of our product specialists to see if it's a fit for.

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