Acquisitive Mind: For Harsh Ghai, the Sky's The Limit!
Harsh Ghai and his Northern California-based Ghai Management Services company have been on the grow, doubling the number of Burger Kings they operate (110) and more than tripling the number of Taco Bells (33) since we last profiled the now 34-year-old in 2015.
But that's not all. As COO of the family business, Ghai has been behind the addition of Blaze Pizza and Denny's over the past 4 years. Now the franchise power player is in the midst developing a 10-acre project north of Sacramento that will provide the family business with the opportunity to add even more units with Burger King, Taco Bell, Arco AM/PM, and a hotel. It's easy to see why he says his pet peeve is complacency.
We caught up with Ghai shortly after his return from an international vacation visiting Spain and Morocco. Eager to get back into the swing of things building his family's company, he generously took the time to share his thoughts on the past four years.
"We have grown through several large acquisitions. In 2016, we purchased 45 Burger Kings in California from a franchisee and then added 21 Taco Bells in Oregon through a refranchising deal, all within one week," he says. Since then, the company has added another 20 Burger Kings in California and divested 20 other Burger Kings in the Midwest. "We are trying to focus on the West Coast, but we would always be open to expanding anywhere in the U.S. for the right opportunity," says Ghai.
All of this growth has affected life at the home office. "We have expanded our support staff to meet the needs," says Ghai. "Our amazing people in HR, finance, risk, and development are instrumental in helping catapult our growth."
On the personal front, Ghai has become a father since we last interviewed him. "My wife and I had our first daughter, Saanjh, almost 2 years ago, and have welcomed our nephew, Ronav, into this world."
Asked about the future he says, "We have no desire to exit the business anytime soon." Of course not, there's so much more to do.
Name: Harsh Ghai
Company: Ghai Management Services
Units: Burger King (110), Taco Bell (33), Blaze Pizza (7), Denny's (1)
Family: Sunny Ghai, father; Tina Ghai, mother; Gurbir Ghai, wife; Saanjh Ghai, daughter
Years in franchising: 9
Years in current position: 7
My father. He started his journey as a restaurant manager in 1997. I watched him struggle and work hard to get what he did. It inspired me to join the family business.
Acquisition of several restaurants over the last 5 years.
Biggest current challenge:
Next big goal:
Growing to a half-billion dollar business.
First turning point in your career:
Back in 2000 when our company went from 13 restaurants to 25 restaurants in a matter of six months.
Best business decision:
Becoming a Taco Bell franchisee.
Hardest lesson learned:
Failure from developing into a new brand we are no longer in. While the concept is great, especially the food, the model did not translate well into franchising in a new market.
7 days with plenty of family vacations!
Absolutely necessary in helping to blow off steam and stay healthy.
Best advice you ever got:
"Your guest is never, ever going to have a better experience than the people who work for you." You constantly have to improve the experience of the people working for you.
What's your passion in business?
My people! Our strength comes from the people who make us successful, and they help keep me driven.
How do you balance life and work?
It's important to make time for yourself and family. You have to rely on and surround yourself with people who support you well, as well as take care of them for doing so.
Wine and sports.
Lord of the Rings. I am also a big fan of The Burger King: Jim McLamore and the Building of an Empire by James W. McLamore.
I'm a huge "Star Wars" nerd!
What do most people not know about you?
That I have a beautiful and charming daughter, Saanjh.
What did you want to be when you grew up?
We just got back from 2 weeks in Morocco and Spain.
Person I'd most like to have lunch with:
Taking people with you. Growth should apply to everyone. Taking care of the people who work hard for you will lead to them taking care of guests, which is most important.
Management method or style:
Developing a new business/concept without an existing base.
How do others describe you?
Fun-loving and innovative.
One thing I'm looking to do better:
I'm always striving to improve the guest experience in our restaurants.
How I give my team room to innovate and experiment:
Creativity is important in helping people succeed. I allow my team members to implement their own ideas. When they work we spread those practices. And when they don't, it's perfectly okay.
How close are you to operations?
Very close. Being in the restaurants and engaging with the restaurant team is important. You might sometimes find me on a line or talking to guests in dining rooms.
What are the two most important things you rely on from your franchisor?
Transparency and trust. The franchisee/franchisor relationship is tricky, and we attribute the recent success in our QSR business to phenomenal relationships we have with our franchisors.
What I need from vendors:
Trust and service. We expect great service just like our guests do. We also have reached a point where we have several amazing vendors we love to work with and expect them to help maintain our trust in them. We have left vendors who have broken that trust very quickly.
Have you changed your marketing strategy in response to the economy? How?
Spending is at an all-time high in our business and we are constantly developing fun and innovative things to help drive business. Our concepts are also doing a great job of providing a great value proposition to keep traffic flowing.
How is social media affecting your business?
Our brands are doing a great job of engaging younger audiences on social media. It has been a key driver for all of our concepts.
How do you hire and fire?
Hiring is tough in this day and age and we use many online resources to draw from. We also offer a competitive package and growth opportunities. Hiring well is the key to not firing. Training our management to interview better is the key.
How do you train and retain?
Training is the key to retention. We found that the best training execution in restaurants leads to the highest level of retention. Staying engaged with the team on training is also key to keeping team members happy.
How do you deal with problem employees?
Coaching and motivating is most important in ensuring there are no problem employees. Everyone has motivating factors. You just have to find what they are, especially with young kids.
Fastest way into my doghouse:
Not following directions!
Developing people for growth in 2020.
Growth meter: How do you measure your growth?
Sales and EBIDTA are important of course, but growth is also measured by the growth of people. New restaurant development is also a big growth factor for us.
Vision meter: Where do you want to be in 5 years? 10 years?
Our next big goal is to reach $500 million in revenue.
Do you have brands in different segments? Why/why not?
Yes. QSR is our core, but fast casual also has a lot of potential. We are also engaged in family dining.
How is the economy in your regions affecting you, your employees, your customers?
We are experiencing solid growth.
Are you experiencing economic growth in your market?
The current economic conditions are working well for us. We see spending is at an all-time high, and high wages are helping drive sales and traffic.
How do changes in the economy affect the way you do business?
Marketing to the current economy is important. We have seen brands flourish in tough economic times creating good value propositions and innovating.
How do you forecast for your business?
Detail is important. Each restaurant is its own individual business and you have to put detail into forecasting.
What are the best sources for capital expansion?
Relationships with key people and lending institutions are important to us. We have stayed with lenders because of our relationship with people there and often left when they leave.
Experience with private equity, local banks, national banks, other institutions? Why/why not?
We have experience with many national banks, and also with local ones. The national banks have been key in our large-scale expansion and development, but local banks have helped us grow in fast casual and real estate. We love the small banks as much as large ones.
What are you doing to take care of your employees?
Growth opportunities are very important to our people. We also make sure to offer competitive pay and have a great benefits program.
How are you handling rising employee costs (payroll, minimum wage, healthcare, etc.)?
Growing top-line sales is of the utmost importance in growing the bottom line while profitability is eroding. Luckily both our QSR brands have had strong sales comps this year.
What laws and regulations are affecting your business and how are you dealing with it?
Regulations are becoming increasingly burdensome, especially in development. It's an everyday fight with municipalities, and you have to reiterate that you are creating jobs and helping support communities.
How do you reward/recognize top-performing employees?
Again, through growth. We make sure that we find growth opportunities for those who perform well.
What kind of exit strategy do you have in place?
None. We have no desire to exit the business anytime soon.
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