EP13: The Real Math of Restaurant Expansion

"Most people build for average, but new stores almost never open at average." Jason Morgan, former CFO turned CEO of Original ChopShop, has spent decades in the restaurant industry learning the hard truths of growth—and watching others get crushed by them. In this episode, Jason sits down with Rachael Nemeth to unpack what separates scalable operations from overbuilt failures, why he won’t ask his team to do anything he can’t do himself, and how training transformed from a compliance checkbox into a strategic lever.
Jason gets real about the risks of expansion, the limits of debt-based growth, and why most operators misjudge how long it takes for new markets to perform. He also dives into the ROI of training done right, sharing how his team achieved 94% completion rates across front and back of house—and what metrics really move the needle on turnover, tenure, and guest satisfaction.
Whether you're operating five units or fifty, Jason’s blend of financial discipline and frontline empathy offers a masterclass in building enduring restaurant businesses.

Key Takeaways

→ New Markets = Lower Volume: Stores in new geographies rarely open at brand average; plan accordingly

→ Training Isn’t a Cost Center: A 94% completion rate led to higher engagement and better retention

→ Retention as Strategy: $20K retention bonuses at 5 and 10 years build loyalty you can’t buy with perks

→ The Ideal P&L: A flexible model to spot early warning signs in labor and food costs
Perfect For:

→ If You Can’t Do It, Don’t Delegate It: Great operators know how to do the work—not just manage the work

Perfect For:
Restaurant operators scaling into new markets, CFOs trying to understand the real ROI of training, HR and L&D leaders building retention programs, and execs juggling culture, capital, and growth across 10–100+ locations.

About Jason Morgan:
Former CEO turned CEO of Original ChopShop with a reputation for leading high-growth restaurant brands through sustainable, capital-efficient expansion. Known for his operational discipline, high standards, and belief that leadership means getting in the trenches—especially when the AP clerk calls in sick.

Time Stamp Chapters
• 00:00 Intro and Jason’s Path to Restaurant Leadership
• 01:36 The Copy Machine Story: Leadership Lessons from Arthur Andersen
• 04:55 Why You Can’t Scale on Debt Alone
• 07:40 The Mistake of Assuming Average Store Volume
• 10:50 When New Stores Underperform: What Comes Next
• 14:30 Behind the 94% Training Completion Rate
• 17:12 Training ROI: What Metrics Really Matter
• 20:05 Creating a Culture That Keeps People
• 22:40 Why We Pay $20K at Year 5
• 25:18 Ideal P&L: Spotting Trouble Before It Hits
• 29:00 Using Opus + Ovation to Solve Real Store Problems
• 31:10 Lightning Round: The Realities of Growth, Store by Store

About Us
Opus is the hospitality training platform purpose-built for the frontline. Train 100% of your team in 101 languages on the job to quickly get them up the productivity curve. With full visibility across your workforce, you get the frontline business intelligence needed to drive your business.
Have an idea or experience you'd like to share? Keep the conversation going with us on LinkedIn: https://www.linkedin.com/company/opus-so/

About Us
Opus is the hospitality training platform purpose-built for the frontline. Train 100% of your team in 101 languages on the job to quickly get them up the productivity curve. With full visibility across your workforce, you get the frontline business intelligence needed to drive your business.

Have an idea or experience you'd like to share? Keep the conversation going with us on LinkedIn!

Transcript

Rachael Nemeth: 0:00

Hi everyone, I am Rachel Nemouth, CEO and founder of Opus Training. So excited to be here and to welcome you to Back to Basics. You know, the restaurant industry really loves to talk about acting like a bigger brand, but most operators really struggle with how to actually do that. And today's guest actually did it and has the numbers to prove it. So I'm sitting down with Jason Morgan, CEO of Original Chop Shop. He brings a really interesting combo of finance rigor and operational reality. If you haven't read his posts on LinkedIn, you should. He acquired Original Chop Shop in 2016 when it had just three locations, grown it to 27 units, while building out what I think is probably one of the most operationally sound businesses in FastCasual. GM tenure is over four years, and employee retention is nearly double the industry average. So what makes Jason really valuable for this conversation and especially for the operators listening is his willingness to show his work. And that is what today's conversation is about. So, Jason, welcome to Back to Basics. Nice to have you here.

Jason Morgan: 1:08

Yeah, thanks for having me. Looking forward to it.

Rachael Nemeth: 1:10

Introduce yourself and tell us a little bit about Original Chop Shop.

Speaker: 1:13

Yeah, so I'm Jason Morgan, CEO of Original Chop Shop. We are a better for you fast casual brand that it's one of the biggest menus in the whole space. We do protein bowls, salads, sandwiches, but we also do fresh squeezed juice, assay bowls, protein shakes, and we do breakfast all day. A lot of folks look at our menu and think we're crazy for having 50 plus items in a world where most of our competitors are going to a very singularly focused menu. What we see with the diversity of the menu is we see a lot of higher frequency. Everybody thinks we're crazy, and so no one's trying to copy it. And so it's like it's rare in this restaurant space that you find something that's unique and you find something that doesn't have a lot of people following, trying to do exactly the same thing you're doing. Second thing about what we've done is our model is a counter service model. So you order the counter, we bring the food to the table. And I've spoken a lot lately about you know a lot of my competitors, and almost everybody has moved to a walk-the-line model, and there's a lot of negative feedback happening about that in social media today. I saw something posted like slop bowls, I guess is the new phrase where people are just shoveling stuff in. Look, we we think that we have the ability to create an emotional connection with the guest because of the service model. If you go to Chipotle, we're I had lunch today, it's very functional, right? So people are coming in and they're they're walking the line and they're expecting to be asked, do you want this or that in your bowl? But they're not asked about, you know, how is your day or what's you know, good to see you again. It's a very transactional focus because it generates the easier labor model. We're doing something completely different. And so I really do feel like we have one of the more unique brands that are out there in the space. We bought the business in 2016, like you said, three units all in Phoenix, and then we've grown it to 26. We have 10 in Arizona, we have 13 in Texas, nine of those in Dallas, three in Houston, one in College Station, and then three in Atlanta. And uh we opened our next door in about three weeks in Phoenix, and then we're hoping to do somewhere between four and eight next year. It's incredible.

Rachael Nemeth: 3:09

When you acquired the brand, did it have that sort of take on the menu and and sort of how you situated yourselves competitively?

Speaker: 3:18

They they had it, they didn't know what they had, if that makes any sense. So, like I walked in the first day and was blown away. I was like, I get it. Like I completely get what this is, what this could be. Um, I don't see anything else like this in the marketplace. Uh, multiple day parts, I mean, we're open at seven in the morning, most of the stores close at nine at night, eight on Sundays. And so there are people that are trickling in all day long. And so you wake up and you've done a $10,000 day, and it's like, wow, that didn't even really seem that busy. I've actually had other restaurant executives say, Man, I'm so sorry about your location, you know, here it it seems never busy. Well, the store does three million dollars. Like it's a it's a busy, busy location.

Rachael Nemeth: 3:57

Well, and and you know, the other day I wrote about ghost employees, about how there's so few restaurants and frontline organizations that are actually thinking about the first 90 days as so critical to lowering those labor costs. I've spoken to CEOs who are actually just not thinking about it at all. They're saying, listen, we don't count those because it's such a high number. So I'm curious to get your perspective on how you sort of segment those labor costs.

Speaker: 4:25

I tend to have epiphanies every three months, six months where something just like hits me over the head, like, how did we not see this? And I probably have told you the story before. We were we were in Phoenix maybe three or four years ago, and we were we were driving around with my head of HR and my COO, and we were going store to store, and we had just looked at turnover, and turnover is like like really high at the time. And I was like, this doesn't make any sense to me because everywhere I go, I see people that I know. Like I it's the same people working at each of these locations. And so we we went back and cut the data in a different way. We we went back and said, okay, if I've got 40 or so hourly people on each on each team, what do the top 15 people look like? How long have they been here? And and it turned out those people had been here for two and a half years on average. I was like, well, those are the people I keep seeing. Like those are the people I see every time I come. And then the other 25 people are people that are gonna be short-term employees with us, and it's just always gonna be that way. And I think the realization of like, okay, these 25 are always gonna churn. Uh, how do we want them to represent the brand in the in the 693 days they're gonna be here? Yeah, and so one of the things we use with with the Opus, your tool, is like we we have really focused on onboarding, and in those first 30, 60, 90 days, I want you to know the menu and I want you to know our hospitality standards. And if that's all you know, I'm I'm winning. Like I'm winning because those people are gonna turn. And then for the other folks, we've we've built more of a career pathing platform where you you show people how you can get from cashier to shift leader to AGM and so forth. So I'm seeing with the trend in the back of the house. And that all comes back to back when I told you I left jobs a lot. Like we brought that sort of idea of like if we can keep people continually learning and feel like that people have a continual, this is what I'm working towards, or this is an opportunity that I'm getting, that people will stay, and people will appreciate it. And so that's what we've seen, and we've had a lot of good success with that so far.

Rachael Nemeth: 6:24

I love that approach too, um, to sort of put people into quartiles almost and say, you know, this is how we're gonna attack this. It's almost like in tech how we think about different use cases, you know, you can't solve the same problem for everyone. What that really makes me think about is um you said this quote. You said it's rare that operational issues get mentioned as reasons for soft sales results.

Speaker: 6:48

Yes.

Rachael Nemeth: 6:49

And especially when brands are really blaming external factors. So walk me through your analysis process when same store sales are underperforming. And more specifically, how do you separate execution issues from external market factors?

Speaker: 7:05

Yeah, it's hard. It it's it's it's stupid hard. And for us, we we want to know if if we have a store that's underperforming, first off, did we pick a bad real estate site? And the answer typically is no there, because we we've done a lot of diligence and and and we're really good at that. And so we we're fairly certain by the time we get something open that that it's a good site. Second question is is something happened externally that that's impacting us, right? So is a new competitor opened up next door? Is there access to parking that's messed up? Is the street under construction? Is there something external that's happening? Because we we believe that we have a brand that if it's executed well, should be continuously growing. I felt the same way at Zoe's Kitchen. It's like if you had a store that was underperforming and was losing sales, and it wasn't some external factor that was obvious, it probably was something happening in the four walls of the restaurant. And and it was almost always certain back to the leadership in the restaurant wasn't doing what you wanted them to do inside the restaurant. And so it's it's easy to go there immediately, right? And go, you know, Susie's not running the store very well, the sales are down, but you sort of work your way to that. And and we have we have a lot of analytics on our side here that that sort of tell the story of is is is this happening a lot? And uh, and so you know, we're looking at at internal reviews, uh customer third-party reviews, we get a lot of reviews. We use ovation. I talk about ovation a lot. I think I talk about ovation and opus more than anything out there, but um, you know, we we did 64,000 uh ovation reviews last year as a brand and averaged a four or six. And and that just if something's going wrong inside the store, our customer is going to tell us. And so we use that. We we have you know different metrics we're asking people to hit in terms of scheduling and staffing and running the labor model, running ideal food costs. Like we have all these uh administrative numbers that are important to us that if you're not hitting them, you we pretty much know, right? And and and and then you just factor a lot of this stuff in. So we we don't necessarily have a scorecard, but we have what we call an ideal PL. I think it's maybe one of the best things we do. I have uh a fixed variable cost PL based on whatever your sales are, this is what your profit should be. This is what your EBITDA should be. Because a lot of it is is it it flexes with increases or decreases in sales, labor margin goes up and down, the the fixed cost that are direct operating costs go up and down from a percentage standpoint. But but we then trend that over time. And so I can look at a store and say, like I've got a store in Atlanta that's had four straight months of really poor performance in terms of labor and food cost. Um and we we think we we have a problem there, we're addressing the problem there, trying to understand what's happening. We don't think it's a a management issue, but we think there's a um just a disconnect somehow in the labor force that we're getting there of not doing what we'd like them to do. So we're we're on top of the underperformers and and very like very analytical in terms of how we think about them.

Rachael Nemeth: 10:01

So speaking of underperformers, you know, we you sort of had this process of elimination to say, okay, I'm walking into a store that's underperforming. I have I'm I have almost a checklist that I'm kind of working my way through. Um from a financial perspective, how do you evaluate what's worth investing in? You know?

Speaker: 10:20

Yeah, so so we we made a decision really probably right around the COVID time period that that that we were going to double down on what we were offering, you know, our salary team members in the in the shops. We actually got rid of the bonus structure and instead gave that back to them in salary. And and so it's my belief that people don't work any harder uh if they have a bonus or not. That if you've hired the right people, that they're gonna come to work every day and they're gonna give you their best. And and if if a competitor opens next door and the sales are bad and they would have lost their bonus, that's not really their fault. Like it's not not their fault. And so we found ourselves always making exceptions to the to the policy, and then we're like, well, let's just get rid of it. And a lot of those folks, they love having the um uh the same the same amount of money coming into their bank account every every two weeks, right? Right, right. So we did that. We upgraded our benefit packages, we added some mental health uh benefits as well. Um for the hourly team, we started paying people you know next day if you wanted to be paid next day. Um we put in a retention bonus, uh, which we didn't have before, where if you're with us for five years, we'll cut you a $20,000 check at the five-year anniversary, and then uh year six, seven, eight, nine, four thousand each year, and then at year 10 another $20,000. And um it's it's a little bit from a finance person, it's a little bit painful at times to go, whoa, we're paying out a lot of money next year for this for this plan. But at the same time, I've got tenure, like like amazing tenure with these folks that have been here for a long time. So we we have a um we have a pretty good program in place in terms of of salary benefits. Um we also we have biannual review process where we we go through this is your you know, this is what you're you're doing great at, this is what you need to work on, these are your your goals. And so we give people twice a year a chance to earn a merit increase. It works out to be the same dollar amount as if we'd have given it once a year, but it it shortens up that review cycle, and and I think that's been interesting. We used to do it four times a year. We just felt like that was a little administratively hard to pull off. And so we switch back to two.

Rachael Nemeth: 12:22

But it's almost like a tighter feedback loop.

Speaker: 12:24

It's a tighter feedback loop.

Rachael Nemeth: 12:25

And you can correct faster.

Speaker: 12:27

Yeah. And so we've kept our span of control really tight in terms of most people have four, four to six restaurants in our in our regional focus. And so, and and they're they're they're hands-on, they're in the shops, they're they're not paper pushers or or sitting on the computer in a in a booth while everybody else is working. They're they're shoulder to shoulder. And so we've I think just we've created a good environment here where um everything it feels very flat um in terms of structure.

Rachael Nemeth: 12:54

Right, because you sort of reduce the scope of what you're in. Yeah.

Speaker: 12:57

It's like like our our office is a good example. We we are in 3,000 square feet. There's 20 of us that are in here, and nobody has an office. Like we're all like it's a big bullpen. Like uh, there's not a single office for anybody, and and I love it. Like, I I I don't I don't want to be behind a door and close the door and hiding from people. Like, it's it's amazing to have everybody out in one space. And so I think that's the sort of the environment too. Like when I walk into a store or or Kyle Frederick, my COO, walks into a store, nobody's scared of us. Like it's just like we're their buddy. Like we're we've created an environment that that I think people uh are excited to see us. We when we've toured potential investors in the past or or other folks around, they're always amazed. They're like, these people know who you are. They they they know who you are, they know everything. I was like, well, that's great. I'm glad I'm glad they do. But it's it's not like I I met someone a couple weeks ago, I won't tell you who it was, but um they run a big brand, and I asked them about stores they had in Houston, and they didn't know if they actually they gave me three stores that were not in Houston. And so, like, like I was like, how do you not know if you have stores in Houston or not? Like, like, like it just baffles me. So we're very connected. We're very connected to the data, to the team, to everything about what's happening here, and that just goes back to the I think the finance piece of the of sort of how my mind works.

Rachael Nemeth: 14:19

You've uh struck this really beautiful balance of of getting in the n in the mud with the numbers, but also the people. And and um I think you've kind of chosen to live in both camps. You're you have a very analytical brain, but you also understand the reality that your frontline doesn't think that way. They think about what's the next paycheck I'm gonna get. And I heard you say earlier, you said, you know, training at Zoe's just wasn't working. At Chop Shop, you've been using Opus for over a year now. You've been a huge advocate for us. And and what I'm curious about is what really sealed the deal that this was the right training tech for your operations.

Speaker: 15:02

Yeah, so we we we wanted to be video based. Like we we wanted the video to be video-based, and and we actually like the idea of creating the content ourselves uh so that it has our look, our feel, our people. Uh, we wanted video-based, and and look, this is we we are very early, we had a video-based training before Opus, and we tried to make it use for everything. We almost try to use it too much. And so with with Opus, what we've focused on is we've narrowed it down to the onboarding and and campaign rollouts. With a narrower focus, we've been able to get people much more engaged and much more involved. I think our last campaign rollout, we had like 94% of our team completed the training, which which that's front of house and back of house, which is just mind-blowing because you know, in the in the older days, you know, years ago, we'd be lucky if 40, 50% of the front of house completed it, and nobody in the bag of house would complete it. Right. And you'd end up with a 30% completion rate. But that 94% of our people got on, went through it. And this is all the people that are going to be here 30 days, 60 days, 90 days, too, right? Back to that. Like all those people completed it too. It's um, it's it's just great. It's it's been really good for us. The the the feedback, um, you know, we're looking for other ways to use it um to to solve. You know, one of the things we we'd like to be able to do very quickly is if we're having a store that's having problems with hospitality or food accuracy to be able to point them to, you know, training for that in particular.

Rachael Nemeth: 16:32

Right. All right.

Speaker: 16:33

And I know that's that's in the works with ovation integrates. Yeah, and so so that's all that's all very interesting to us as well. I think we'll keep it a very narrow scope of what we're trying to use it for. Um and and then we still do a lot of shoulder-to-shoul training as well.

Rachael Nemeth: 16:47

Yeah, which should never go away. That's a lot of how we align our organizations, is is you've had that that philosophy of, yes, we need a platform that can sort of do everything, but we also want to make sure that it's targeted to the things that we need in the organization right now. I mean, maybe that campaign is a great example here. When you look at those completion rates, what metrics do you track to just ensure that you're actually delivering the ROI that you're looking for?

Speaker: 17:14

Um, I don't know if there's anything in particular that I track. I mean, we're we're tracking turnover, right? We're looking at turnover, looking at tenure. We're we're looking at uh 30, 60, 90 day tenure as well. Um we're looking at guest at reviews, whether it's through the Google or whether it's through Ovation to understand how we're performing there. Um a little bit of everything. There's not anything in particular that's a lot of different things.

Rachael Nemeth: 17:37

Not a single metric. Yeah. I think that's how a lot of operators are thinking about it too. And that's why training has become seen as like the cost center instead of a clear ROI. Because with um certain pieces of technology, you can clearly say, okay, this is making it faster to do X, Y, and Z, but training is so embedded in every interaction that it can get harder. But if you're seeing the needle move on those initiatives like turnover or you know, same store sales or something, but you're also seeing that there's a correlation to completion, then that's how we think about it too. It doesn't have to be overcomplicated.

Speaker: 18:17

I mean, like you could you can always just go go put a training dollar to people that are turning over and come up with a gigantic number. It's always a gigantic number when you think about it that way. And so just to know that you're keeping people longer is sort of inherently implies that that number's lesser. Yeah.

Rachael Nemeth: 18:33

Earlier you mentioned this is not uh a one-man show. You have a team that's really um helping you execute on these initiatives. And you talked about how you hired doers, not traditional executives. Kyle, your COO. That sounds like it comes really from experience. Was there a hire or a situation that really taught you the difference between someone who can talk versus someone who can do?

Speaker: 19:00

Yeah, that's a good question. I I've I've seen it my whole career. I'll step back to way back to like and tell you where where it sort of first time it hit me. Uh, I was at work for Arthur Anderson out of business school back in a long time ago. And I had someone that was senior to me walk past the copier to bring me a piece of paper to make a copy for him. And I was like, what in the hell, man? Like, like, like I've I've got an MBA from a top 20 school, and and you you what it took you longer to bring it to me than if you could have just done it yourself. And so at that point, I'm like, I'm never gonna ask anybody to do something that that I wouldn't be willing to do myself. Not only willing to do it, but I better know how to do it, right? So so I I pride myself on knowing how to do most everything that everybody's doing. I may not be able to do it as well, but but if if my AP clerk is out tomorrow, I probably can go go cut checks and and run run AP, right? And so uh I've I've wanted to always sort of hire people with that same mentality. Um you see in in these bigger organizations, like at the Harris of the World, not so much of Gaylord, but but there was a few there probably, you see people that get hired into these very senior roles, and they don't do a lot of day-to-day work. Um they hire people, they then hire people, and all of a sudden you end up with layers of people, and the people at the bottom are doing the work, and everybody else is sort of managing the managing the managing of the work. It's just uncanny. And so I think like in some of these big restaurant companies, I mean, sweet green have picked on quite a bit on my LinkedIn post, um, I think that's a challenge for them there. I mean, they're running three times the the GNA that then anyone else is running in this in the in the space. And I think that I think that's the issue is they've got person on top of person on top of person. So what we did here um early on is that the the first core round of hires at Chop Shop are all Zoe's kitchen people. I was very fortunate that the uh the people that that wanted that that I wanted and and they wanted to come, they came over to Chop Shop. At Zoe's they had seen explosive growth, growth for the most part really well done, but they were at job levels that didn't participate in the financial upside that uh myself and a few other people had at Zoe's, but they got all the experience. And not only did they get the experience, but they were so young that if they went and tried to convince a recruiter in the space that they had the experience, the recruiter would go, no, you don't really know how to do that.

Speaker 1: 21:23

Right.

Speaker: 21:23

You don't have to do it and like I know they know how to do that. So um, so that's who I hired. I hired people that that had seen a lot at a at a at a young part of their career and had lots of upside. And as always, we were I mean, until the IPO, we were doers. Like it was it was a lean group, and then the IPO sort of turned that business into into what I'd seen elsewhere, where you all of a sudden have executives, right? And the executives come in and and they vented bigger businesses and they just build structure and and it's just a lot of fluff. And so we've tried not to do that here. So back with everything we've done here is very lean. We've got a handful of people, two, three people in each department, and um there are things I do every day that would probably shock you in terms of like.

Rachael Nemeth: 22:07

What's one thing you've done today that would shock me?

Speaker: 22:09

Um I am the database administrator for our restaurant 365 recipes. And and like, do I need to do it? Probably not, but I built it when like seven years ago, eight years ago. I'm very particular about syntax and how things are set up. It's correct. It could easily become not correct, and it doesn't take much time. And so so I I jump in when there's a change to be made, I jump in and make the change. Um I probably need to give that to somebody, but um, but I enjoy doing it. And it's again, it doesn't take it doesn't take a lot of time, and and I know it's right. And and that being, you know, the the largest or second largest expense on the PL, like having comfort that that's right is is really good. And so the people that I've hired have that same mentality where they're they're they're open to doing anything that comes up. It's a good environment to be in. And and when people seeing, you know, they see the leadership doing those kind of things, they just sort of like emulate it as well. And they and it's like it just sort of creates the same environment for everybody.

Rachael Nemeth: 23:11

So um you've given a lot of people advice as and and financial advice as someone who's been plugged into the industry for you know 15 plus years. What's one thing about the future of restaurants that most operators are getting wrong today? What's your advice to them?

Speaker: 23:30

Yeah, so I'll I'll focus this on small company-owned restaurant concepts because that's where that's where most all my experience has been. Uh I think the thing that people miss the most is that when you open stores in new geographies, they're not going to perform at the rate that your average is. And I see people make this mistake every day.

Rachael Nemeth: 23:53

They just expect cookie cutter results with the city.

Speaker: 23:55

Well, they just the well the problem is that in in these small businesses, uh it's very equity intensive in terms of you you can't grow a business like mine through debt. You have to have equity. And if you built structure and an overhead team, you likely have very little profitability in the early years. Some most and a lot of people don't have any profitability at all. So you can't borrow money to continue growing. You have to continue bringing equity in. And most of the time you you have just enough equity, right? So you're planning and you built a three-year model, and and you expect stores that you're opening to open at average volumes, and they don't. And they won't. And it's a rare, it's rare that they do. And what happens to people is that they get they get those stores open, they don't perform, and then they've also got leases signed for the next year already, because there's a 12-month period of time, and all of a sudden they're in a huge financial crisis, in a cash crisis. And more times than not, what happens then is the whole business sort of stalls, stores get closed. I just was sending an email just before this to someone that actually had the same question. It's like, why are your stores in Atlanta and Houston performing less than the brand average? And I'm like, well, that's how it works. Like we have at least we have three stores there that they opened at 60 to 70 percent of brand volume. They will not grow past that until time passes or more stores get built. Again, it's very predictable in my mind of how this all works and the math behind it. But the mistake people make is they just they get they get over the skis and what they've committed to, and then they the when the stores don't perform, they don't have the money to keep going.

Rachael Nemeth: 25:34

And and looking ahead a couple of years, do you think that's what separates the winners from the losers?

Speaker: 25:42

I think that um I think there are going to be very few winners in my space. It's small small company winners because of that, and because of the lack of investment from from firms. Um, there's just not that many people out investing in small restaurant companies today. The people that that made a lot of money pre-COVID, their funds got much bigger and they've gone to bigger opportunities. And the people that lost money pre-COVID, which is the majority of people, they don't want anything to do with restaurants because it's a tougher environment. And then you've got these new folks that are coming in that don't really understand it. And so there's there's very little investment happening in my mind in sort of that 15 to 30 unit restaurant uh segment. And and so when I look at it, and and I've tried to do quite a bit of research, and every every couple weeks I find a new uh restaurant that I miss. But we were at a conference, we we were recognized this year as number 13 on the movers and shakers list. Um very excited to be there. This is the best, best high ranking we've had. I was at the banquet looking at people they were calling out, and I was like, man, all these people are franchise oars. Like every every single one of these people is a franchise oar. Like, who who are the company-owned people in the top 15? And it was us, it was Chipotle, 3,800 restaurants, and uh and Urbane Cafe out of California. Yeah. So I came home and I was like, I wonder if what we're doing is just really not that many people doing it or succeeding at it. And uh, and so I started trying to compile a list of of fast casual restaurants, all company-owned, um, in three states or more, uh, and uh less than 40 units. And you would think there'd be tens, 50, 100 of these across the country. I think I found 12. Like 12 in the entire U.S. that that meet that criteria, and and most of those are small, and and about half of them have already tried to grow and have failed because of what I've just told you, right? And so when you look at the universe of people trying to do what we're trying to do, I think there's less than four or five people in the entire US today that have a chance to get to 50 units in the next three years.

Rachael Nemeth: 27:44

Like I think that puts you as such as as a real model for what it could be.

Speaker: 27:48

Absol 100%. Yeah. Yeah, that's that's my argument. That's my that's my pitch to people is like like Right.

Rachael Nemeth: 27:53

This isn't doom and gloom. It's like this is possible.

Speaker: 27:56

Yeah, it's it's it's it's possible. It's hard, but it's possible. And and you've got to have like one of the things that that that we did that's very differentiated versus what a lot of folks do is we started putting in systems and process uh at three restaurants.

Speaker 1: 28:10

Yeah. Right?

Speaker: 28:11

We we by the time we had eight restaurants, we had something that was very repeatable and scalable. And and a lot of times, um, it's not a finance person like me running the business. It's a creative type that is, you know, that it's into the food, or they're a chef, or they're they're that that's what they've done. Uh and and they get they get to the point where they're so big they they hard to go put all that stuff in, or it's failed before they put the stuff in. So I feel like we're, you know, it it's a it's an odd model, but it's a model that I've seen now work twice with with Zoe's and here. And so now like convinced this is the best way to do it.

Rachael Nemeth: 28:44

Well, it's been very impressive to watch you all to to to be on this journey with you. Um and and I agree, I think there's a really interesting opportunity for original chop shop to be a model of of a new way of operating restaurants, or maybe not even a new way, but just uh a more transparent way. Um so, Jason, you are super transparent online on LinkedIn. Um I'm gonna make you transparent in a new way. We're gonna do a quick lightning round to finish up here. The challenge here is it's less than 60 seconds, it's five questions, it's all about you. Um so we'll start with uh what was your first job?

Speaker: 29:24

Uh first job, I worked in the concession stand at a uh Carmike Cinemas in Opalica, Alabama, where I grew up.

Rachael Nemeth: 29:30

Wow. You were in the food industry.

Speaker: 29:33

Yes. Sling of popcorn and dye cokes, yes.

Rachael Nemeth: 29:37

What's a restaurant industry trend you're completely over?

Speaker: 29:41

A trend that I'm over. I I I I'm overpaying for influencers. I don't think it's worth the pay. I don't think it's worth the money. I don't I don't think it's worth the money. Uh in in especially for a brand like us.

Rachael Nemeth: 29:53

Hot take. Hot take. Um all right. What skill are you? You going back to basics on personally as a human?

Speaker: 30:04

As a human. Yeah.

Rachael Nemeth: 30:05

What are you working on? What are you trying to learn?

Speaker: 30:07

Man, these touchy-feely questions are tough for a finance account.

Rachael Nemeth: 30:11

That's why I asked them.

Speaker: 30:12

Oh my gosh. What am I working on as a human? Messaging. Just messaging. I I I tended to be very direct in the early part of my career to the point where I think it was offensive to people. And so I've learned a lot in the last 20 years, but I'm always conscious of it in terms of how I write emails, how I interact with people. I tend to try to give people outs, even though if I know, like if you send me something that I know is wrong, I'm gonna write something back and say, you know, I'm not sure if you've if you've thought about this, you know, but have what about this? And not I'm not gonna tell you you're wrong anymore. 20 years ago I always said you're wrong, and this is the right answer. And so I continually work at that.

Rachael Nemeth: 30:49

That's a great answer. That actually answered my last question, too. Um so we'll end there. Yeah, Jason, thanks for indulging my lightning round. Thank you for joining us today. This was awesome. Uh it's it's always such a pleasure to talk with you, and I always learn so much. And if you haven't caught Jason, either visit one of their stores at Arizona Atlanta Greater Texas area. Um, or catch him on LinkedIn. Uh, he has really great things to say. Jason, thanks again, and uh we'll see you soon.

Speaker: 31:19

Yeah, thanks, Rachel.

unknown: 31:20

Bye.

Rachael Nemeth: 31:20

Awesome. Bye.

Speaker: 31:26

We have biannual review process where we we go through this is your you're doing great at, this is what you need to work on, these are your your goals. And so we give people twice a year a chance to earn a merit increase. It works out to be the same dollar amount as if we'd have given it once a year, but it it shortens up that review cycle. And and I think that's been interesting. We used to do it four times a year. We just felt like that was a little bit administratively hard to pull off. And so we switch back to two.

Rachael Nemeth: 31:52

But it's almost like a tighter feedback loop.

Speaker: 31:54

It's a tighter feedback loop.

Rachael Nemeth: 31:55

We can correct faster. Yeah.

Speaker: 31:57

And look, we got