From Father to Sons: Building a business for the next generation

Name: David E. Gronewoller

Title: President & CEO

Company: GC Partners and GRO Restaurant Group

Units: 14 Golden Corral

Age: 68

Family: My wife, Donna, 5 adult children, 12 grandchildren

Years in franchising: 29

Years in current position: 29

Since we last visited with Dave Gronewoller in 2014, he’s been busy adding more Golden Corral locations, has formed two new businesses, and has had the privilege of opening the first of Golden Corral’s new prototypes. Throughout, the North Carolina-based operator is still focused on developing his people and serving his customers in the Carolinas and Florida. 

Gronewoller unveiled Golden Corral’s first new restaurant prototype, the Gateway, in December 2018. The design’s contemporary exterior complements an enlarged dining area that features wood tones, a stone fireplace, and oversized windows. “It’s meant to attract a whole new generation of guests,” he says.

A year later, Gronewoller opened another Gateway prototype in the Miami market before forming GRO Restaurant Group with his son, Brendyn, who serves as president and CEO. “We purchased an additional six Golden Corrals (now seven) with Brendyn,” he says. “He brings a fresh new perspective to the business, and it’s great working with him.”

This past March, Gronewoller formed GRO-FS with sons Brendyn and Nathan, Jon Fritchey, and Roger Schmidt. The group’s first purchase was a Golden Corral in Fayetteville, Arkansas. Gronewoller, 68, says the business itself won’t have an exit strategy for at least another generation. “We are in this for the long term. As far as my personal exit strategy, as soon as Brendyn and our leadership team are comfortable, I’ll exit!”

PERSONAL

First job: My very first job was for a rancher in northern Colorado, digging and setting miles of fence posts. My first job in the restaurant industry was in Phoenix as a dishwasher.

Formative influences/events: Working on ranches in Colorado, and my uncle’s farm in northwest Kansas during the summers was very rewarding. My uncle was the smartest, most humble person I knew, and he taught me how to work smarter, not harder. Sports were also a great influence in my life. They taught me how to work as a team and with a team to win, while everyone plays a part. Taking a job as a dishwasher in a 24-hour restaurant after dropping out of college showed me that every position is important and deserves respect. Each role serves a purpose for the greater good, adding value to one’s family, one’s self, and the business. When I leave work, or any other task, I feel the best when I did everything I could to make a positive difference—for my family, for our employees, and the others our business relies on. It is just the best.

Key accomplishments: My family. I have been blessed and am extremely proud of each of them (including all four of my daughters-in-law and my son-in-law). Growing a successful business surrounded by the most incredible, talented, and committed individuals. They are just great people! Purchasing an additional six Golden Corrals (now seven) with my son, Brendyn, the CEO of the entity. Selected as Restaurateur of the Year by my peers in the state of North Carolina. Serving on the Board of Directors of the North Carolina Restaurant & Lodging Association for 20+ years (I think), elected Chairman in 2006. Being a founding trustee with the NCRLA Education Foundation supporting educational opportunities for the children of North Carolina hospitality industry employees. The countless Golden Corral awards our people have earned, along with being the first to receive Golden Corral’s Caring Culture Award. Elected and serving more than 20 years on Golden Corral’s Franchise Advisory Council and selected as chairman for 5 consecutive years.

Biggest current challenge: Making sure our team is prepared to compete in the industry, with all of the pandemic-related issues we’ve faced. Because of our strong team, we have done extremely well pivoting through the challenges.

Next big goal: Find solid opportunities for our long-term team members that will enhance them, their families, and our businesses.

The first turning point in your career: When I found out my wife was pregnant for the first time. I knew then that it was time for me to get serious. I was about to have a family and a legacy to protect and provide for.

Best business decision: Choosing to become a Golden Corral franchisee. We ventured into other businesses/franchises and divested them within 2 to 3 years. In my opinion, other concepts didn’t have what it took to support my needs and wants as a business owner.

Hardest lesson learned: Trusting someone I do not know well. I had worked a number of years with Golden Corral before they franchised. No matter the situation, their word was worth more than the wording of any document. It was something I relied on. There were several hard and expensive lessons learned when I left and became a franchisee. Golden Corral understands that and provides avenues to protect new franchisees from those same types of mistakes.

Work week: I routinely get up at 5 a.m. Coffee, check email, calendar, reports, and plan the day. I’m in the office by 7 a.m. to make calls and attend meetings, then try to get out to the restaurants. Because weekends are the busiest days in our restaurants, I expect our management team to be there. I am no exception, and I work most weekends.

Best advice you ever got: Don’t try to fit a square peg into a round hole.

What is your passion in business? Knowing that I am making a positive difference in the lives of our employees, their families, and our guests every day.

How do you balance life and work? I don’t believe I do. I’m deeply passionate about both and give them all I have.

Guilty pleasure: Right now, my grandchildren. I enjoy spending all of my time with them.

Favorite book: Morning on Horseback by David McCullough, a biography of Theodore Roosevelt’s early life. Others I found interesting were 1491 and The Ranch. 

Favorite movie: A new series, “1883.” My great-grandparents were all settlers/pioneers, and growing up I heard a lot of stories. This series was very accurate in many ways, in line with those stories.

What do most people not know about you? I dropped out of college in my second year, packed up everything I owned, moved to Phoenix, and found a job as a restaurant dishwasher. I learned a lot about myself and the business, and loved the job and the people.

Pet peeve: Not doing the right thing.

What did you want to be when you grew up? Forest ranger/professional hunter for the Forest Service, or join the Ski Patrol.

Last vacation: Hunting trip to Oregon.

The person I would most like to have lunch with: Ronald Reagan. (Yes, I know that cannot happen.) Philip McLean, pastor, friend, and the man I respect most in this world and wish I could be more like.

MANAGEMENT

Business philosophy: First and most important, we give thanks to God for the opportunities he has provided. I firmly believe decisions need to be made as close to the guest or vendor as possible, and they need to be the right decision for the situation. “Do the right thing and do it well.” I promote or search to hire the best person, the best fit, and compensate them well. I require experienced management, with recent (within the last 2 years) legitimate and verifiable successes. When the right individual is hired (or preferably promoted from within), Golden Corral has an excellent training program to teach and guide, while working with one or more of our experienced general managers to better understand our culture. I have confidence in who I’ve hired and trust their decisions and actions. My responsibility is to provide them with the assets, tools, and opportunities they need—then let them do what they do best! They have a great amount of autonomy, staying within obvious guidelines to do what they believe needs to be done.

Management method or style: In touch, informed, and supportive. Constant communicator.

Greatest challenge: Challenging our general managers, associate managers, and professional (administrative) staff at a higher level every year. Our tenure scope is between 8 and 29 years and they each know their part of our business far better than I do, so it can be a real challenge to understand how and where to best support their needs to fulfill their responsibilities. Our hourly co-workers mirror this tenure in every single restaurant—something exceptional in today’s world and something we are all proud of as it speaks to the individual restaurants’ leadership.

How do others describe you? Driven, trustworthy, diligent, available, intensely competitive, and deeply committed.

One thing I am looking to do better: There are three things I want and need to do better: 1) Be a better mentor for my sons Brendyn and Nathan, who are now in our business. 2) Provide better support for our management teams and their families. 3) Get out of the office and into the restaurants more. That is where the action is. Once the doors are open, that is where everything begins—and ends—for our business.

How I give my team room to innovate and experiment: By being their biggest fan! As in any business, especially a franchise, there is a foundation we must operate from. So inside that, I’m open to anything that will make our business grow, operate better, and create opportunities for our people to develop and grow. Our people are very good at that! Golden Corral, a franchise-centric franchisor, is great about this also. They listen and are very supportive. Innovation from our frontline teams fills a pipeline supported by Golden Corral. This makes the system more agile and more competitive and drives our guest count and profitability. They listen and bring extensive expertise, knowledge, experience, and outside resources to the table.

How close are you to operations? Very. Every day I am in the office and try to get into the restaurants after my calls and meetings. I work on the weekends as well.

What are the two most important things you rely on from your franchisor? 1) Protect the brand. 2) Provide a significant, legitimate competitive advantage in all relevant areas of our business.

What I need from vendors: Commitment and partnership. We value our vendors and couldn’t be in business without them. We work hard to maintain long-term and trusting relationships with our vendors. We expect the best and freshest product—at the best price—to provide to our guests.

Have you changed your marketing strategy in response to the economy? How? Golden Corral has a great marketing department and outside agencies coordinating our systemwide plan and needs, along with insight and support for programs we do outside of the system in our markets.

How is social media affecting your business? We’ve had great success with social media and are currently expanding in this area.

How do you hire and fire? The general managers of our Golden Corral restaurants do the hiring and firing and we provide them with the resources and support they want and need in their particular market. Terminations are something we take very personally. A termination means we both failed, and both have ownership in the failure.

How do you train and retain? Golden Corral has an excellent training program for every position, along with self-development systems for those who want more. With that, along with our focus on having the best co-workers for them to work with—it’s great. Our culture plays a large part in retention, and we provide opportunities for every individual at every level and position to develop and grow, including our leadership.

How do you deal with problem employees? Head-on and up front. If the individual is capable, has been trained well, but just can’t get it right, we’ll see if there is another position for them. For some individuals, nothing works, and the sooner we confront it and cut the strings, the better off we both are. In some cases, we’ll help them find another job elsewhere. That said, our other staff members in general take care of a capable individual who won’t perform, which makes their jobs more difficult.

Fastest way into my doghouse: Not doing the right thing (in any situation), and not doing what you said you could and would do.

COVID-19

How did Covid-19 affect your business? It was devastating. Literally all media, even in our industry, determined “buffet” was history. They would be no more. It was everywhere. All the big Las Vegas hotels were redesigning their buffet spaces for something else.

How have you responded? Initially, we thought it would only last a couple or a few weeks, maybe a month. Thanks to our franchisor, and our national and state restaurant associations, we knew what was going to happen three or four days ahead of the announcement and immediately had a conference call with my operations and administrative team. Collectively, we created a plan. First, we all believed in our business, in our people, and that when it was over, we would still fill a need in the communities we operate in. We knew it would be a fight, and a fight we were ready to win. We jumped in punching, kicking, and screaming with everything we had to win. Each general and associate manager took the responsibility to ensure each hourly employee went online and registered for unemployment insurance immediately so they wouldn’t be doing so while the rest of the country was. We came up with an effective plan to compensate our management teams and professional staff. What we did was a suggestion from our general managers. Our general managers communicated with our most needy hourly employees with families, bringing them into the restaurant to take from our inventories, food, and other necessary supplies to get them through. What was left was given to our other employees. We did some deep cleaning and maintenance, again using our employees with the most need. One way or another, we kept our key employees engaged. Collectively, we devised a service standard for a “buffet” that provided the safest dining experience for our employees and guests. I’ll challenge anyone who had a safer way.

With restaurants spread over 5 states, 14 counties, and 14 cities, we reopened within zero to 3 days after the local mandates were received. Trying to monitor daily the executive orders and local mandated restrictions was a nightmare. In one state, where it did not quite fit the governor’s mandate, we met with the officials with oversight who agreed, and though the executive order wasn’t changed, we were given a phone number to call if we had a problem with enforcement. In another market, we were way outside of an executive order. When an inspector showed up to inspect, she said, “Don’t worry about it, we love what you are doing, and I’ve eaten here 10 times in the past three weeks.”

One restaurant has provided meal programs typically referred to as Meals on Wheels, serving daily hot nutritional meals, at no cost, to those in need since 2005, providing more than 1.1 million meals annually to five surrounding counties. Since these meals are delivered hot and fresh daily to each recipient’s home by volunteers, they were effectively shut down for what would have lasted 18 months. Our general manager, Francis Traver, came up with the idea that since each county had a full staff for these programs, we would provide the meals frozen, and each county would use their staff to deliver five frozen meals once a week to each recipient, instead of a volunteer delivering one hot meal each day. Over the 18 months it took to get fully back into the program, every recipient continued to receive their meals.

There are two things I’m most proud of: 1) We retained every member of our management teams and professional staff and 85% of our key hourly employees. Though we are not what we consider fully staffed, we are staffed at a level to handle our business and far better off than everyone we know. 2) Our general and associate managers. After all our restaurants were fully open, our business was doing incredibly well. We calculated everyone’s compensation compared with the previous year, then wrote some very large checks to each of them that made their earnings whole to the previous year. While delivering these checks to these individuals, I found out that some of them had been taking the checks we were sending them during the shutdown, cashing them, and giving that cash to their employees most in need. This humbled me more than anything. Heartwarming!

In summary, we have recovered, we are well over pre-pandemic guest counts and sales, and are setting record profits. There are only a few non-QSR/fast-casual restaurants that can say that. This is all due to the leadership in our restaurants. Golden Corral has been very supportive of the methods we used, communicating successes in other areas, and keeping every franchisee up to date was paramount.

What changes do you think will be permanent? I believe that is still to be seen. We will retain whatever is necessary to keep our employees and guests safe.

BOTTOM LINE

Annual revenue: $69 million for our 14 restaurants.

2022 goals: The same as every other year: to grow our market share in each market we serve.

Growth meter: How do you measure your growth? Guest count growth. Economic factors may dictate price; we look at sales and expenses on a per-guest basis. If we aren’t growing guests, we really aren’t growing.

Vision meter: Where do you want to be in 5 years? 10 years? Enjoying life and hearing about the successes of this organization, moving forward, sideways, or upward, whatever they may be.

Do you have brands in different segments? Why/why not? We ventured into other businesses/franchises (well-known fast-casual and full-service) and divested them within 2 to 3 years, as it wasn’t a great fit.

How is the economy in your regions affecting you, your employees, and your customers? We do everything possible not to allow the economic problems that we are facing affect our guests. We have been very fortunate in staffing where we could use a few more people, but we are in far better shape than the industry as a whole and other restaurants within our markets. The same goes for food availability. Our vendors have bent over backward to get us the products we need, and we are very thankful for them. Telly Smith, who runs Golden Corral’s purchasing and distribution, has been tremendous in this regard.

Are you experiencing economic growth in your markets? Across the board, yes.

How do changes in the economy affect the way you do business? We won’t let the economy affect the way we do business. We may struggle with economic issues, but we do not let it affect the way we do business. That would be a terrible thing to do.

How do you forecast for your business? One restaurant at a time, in small pieces, starting with guest counts by day, then building out from there. We definitely involve each general manager’s input.

What are the best sources for capital expansion? Preferably from within. Our capital company has been tremendous in supporting our plan and working with us throughout the pandemic after the shutdown.

Experience with private equity, local banks, national banks, and other institutions? Why/why not? Over the years we used all of these except for PE groups. We found that as we grew, we required lenders specifically attuned to our industry. Any smart operator should look at all sources of financing within their scope.

What are you doing to take care of your employees? I’d say the first responsibility to each employee is to give them outstanding employees to work with. We do what we need to do.

How are you handling rising employee costs (payroll, minimum wage, healthcare, etc.)? With great care. There are a lot of people specifically targeting our people.

What laws and regulations are affecting your business and how are you dealing with them? Regulations are constantly being added and we confront and deal with them. For me personally, it’s most difficult when a regulation detracts from an individual’s responsibility for themself, their family, and in their decisions and actions.

How do you reward/recognize top-performing employees? There are countless ways. However, we believe the most important is to recognize top performance immediately and to let everyone else know. Our team knows!

What kind of exit strategy do you have in place? As far as our business, we won’t be talking about an exit strategy for at least another generation. We are in this for the long term. As far as my personal exit strategy, as soon as my son Brendyn and our leadership team is comfortable I’ll exit!