Fired Up!: Former EMT Combines Subs with Service

Kevin Hatton is honest enough to admit that when he became an EMT at age 18, he came to the job with no noble or lofty motives. "My reason for becoming an EMT was that I would be able to drive fast and run lights and sirens," says the 39-year-old husband and father. "But I fell in love with it and worked for the Georgetown County, EMS before they even had 911 service."

The son of a Methodist minister and a family of restaurant owners, Hatton, who spent 12 years as an EMT, also spent time washing dishes, waiting tables, and learning about the restaurant business. "Once the restaurant business gets into your blood, it's there--you never really get out of it," he says.

Flash forward to 2011 and the Multi-Unit Franchisee magazine MVP Award winner owns five Firehouse Subs restaurants in the Charleston, S.C., area and lives a life that combines both of his passions: helping others and working in the food business.

Hatton, a native of Greenville, S.C., became involved with Firehouse Subs when he saw how hard his retired minister/father was working at the franchise he opened in Georgetown in the late 1990s. "He was working harder than I wanted to see him working, so I quit working at a seafood buffet in Myrtle Beach and came on board. Together we grew two other Firehouse Subs in Myrtle Beach and I became a franchisee with another Myrtle Beach location," says Hatton.

With a goal of opening 8 to 10 Firehouse Subs, he decided to leave the crowded Myrtle Beach market and move to Charleston, which had no Firehouse Subs. The city, which is recovering well from the recession, has been good for his business and his family, and Hatton has gained a reputation for helping out in the community whenever needed. His work with Firehouse Subs' Public Safety Foundation, founded by franchisors and former firefighters Chris and Robin Sorensen, has set him apart and continued the close relationship between the restaurants and public servants.

A highlight of his career occurred when a piece of equipment purchased by Firehouse Subs for the Mount Pleasant, S.C., fire department was credited with saving the life of a local man. The inspirational story caught the eye of Anderson Cooper of CNN, who sent a reporter to do a story on it. "Here we were actually making a huge impact on this man's life. That's more important to me than anything else we could do," says Hatton.

Questions

Name: Kevin Hatton
Title: Owner
Company: Second Alarm Restaurant Group
No. of units: 5 Firehouse Subs

Personal

Age: 39
Family: Wife and two boys
Years in franchising: 9
Years in current position: 9

Key accomplishments:
Opening stores even during a recession, my work with the Public Safety Foundation, and having a management team with each member having an average of over seven years with the company.

Biggest mistake:
Opening units in locations that were not good locations.

Smartest mistake:
Not knowing that I could fail.

How do you spend a typical day?
Analyzing sales numbers, setting schedules, dealing with catering orders, accounting, working with crew during the lunch rush, meeting with managers and staff to identify needs, trying to fulfill said needs, going over any goals and achievements, setting new goals, coaching staff, marketing, and reading and responding to email. I finish the day by looking over the day's sales.

Work week:
Often seven days a week, somewhere between 55 and 80 hours, even though I do try to take one day off and spend it with my family.

Favorite fun activities:
Anything to do with the water--boating, fishing, skiing (water and snow), diving--and playing baseball and football with my boys.

Exercise/workout:
Walk/jog at least two miles a day. I try to jog as much of it as I can.

Favorite tech toys:
My iPhone.

What are you reading?
How Funny by Dave Ramsey.

Do you have a favorite quote/advice?
"No excuses!!" It's from the book No Excuses: The True Story of a Congenital Amputee Who Became a Champion in Wrestling and in Life by Kyle Maynard. I also like: "When good leaders speak, people listen. When great leaders speak, armies move"; and "I have never learned anything while I was speaking." Best advice you ever got:
The Golden Rule. Treat people as you would like to be treated. Go the extra mile.

Formative influences/events:
Past bosses, my experiences as an EMT/firefighter.

How do you balance life and work?
Not very well, but I try when I'm spending quality time with my family to leave work behind.

Business philosophy:
Positive mental attitude (PMA). Go the extra mile. Do what is not expected.

Are you in the franchising, real estate, or customer service business? Why?
Franchising... I know my strong points and my limitations. I found a brand that truly fits me both professionally and personally. I don't think I could have come up with the ideas on my own.

What gets you out of bed in the morning?
My alarm clock, plus I love what I do. I love making people happy and meeting new people. I love to talk to people. I love showing people that Firehouse makes the best subs and has the best culture anywhere. I love the smile that wasn't there when they came in. That tells me we just made their day. And it's easy to make someone's day--just give them a great experience. Go above what is expected. Go the extra mile.

What's your passion in business?
Not only do I want to be wealthy financially, but also personally and emotionally. I want to make a difference in our employees' and our customers' lives and in our community. I don't want just to run a good sandwich shop. I want to touch lives, and if we make a few great subs along the way, then great. If it's true that you judge a person's success by the number of people that show up to their funeral, I want the line to go around the block.

Management method or style:
I lead by service. I try to serve my employees as much as they serve our customers.

Greatest challenge:
Transitioning from one or two units to four, five, and beyond while still keeping my management style.

How close are you to operations?
Daily.

Have you changed your marketing strategy in response to the economy? How?
Wow, did I! I doubled my required marketing contributions and launched an aggressive radio campaign. I also went grassroots, and my management team and I went door to door with goodie bags to tell people about Firehouse and to form a personal relationship with those businesses.

Personality:
I think that I'm a hybrid. There isn't one that describes me. Sometimes I'm very laid back and just go with the flow. Other times, I'm on fire, going 100 miles an hour.

How do others describe you?
Hopefully as a nice guy.

How do you hire and fire?
Hire slowly and fire quickly. I look for people with the same work ethic and desire to please as I have, not necessarily the same mindset and ideology because that can bring fresh perspectives. You have to fire with compassion because these people are possible customers and ambassadors of your company even though they have been let go.

How do you train and retain?
Constantly, to keep our crew engaged.

How do you deal with problem employees?
I try to retrain and also find out what the true issues are. There are two things that cause people to fail to perform or conform to your company's standards: either lack of knowledge or lack of desire.

Bottom Line

Annual revenue:
Prefer not to say.

2011 goals:
Continue with the success that we have had with both the stores and the Public Safety Foundation, identify a new location in the Charleston area, and implement better training procedures to handle the added volume of business.

Growth meter: How do you measure your growth?
Transaction counts and sales.

Vision meter: Where do you want to be in 5 years? 10 years?
Five more stores in 5 years, and in 10 years, 10 more. But still working with Firehouse and the Public Safety Foundation.

How has the most recent economic cycle affected you, your employees, your customers?
It has taught me to be frugal. Our employees appreciate having a job and being able to provide for their families. Customers have had to find ways to pay the bills, and when they come to eat they expect great value and demand better service.

Are you experiencing economic growth/recovery in your market?
Recovery.

What did you change or do differently in this economy that you plan to continue doing?
We changed our marketing strategy and tactics and our emphasis on service. We plan to continue on this track.

How do you forecast for your business in this economy?
Take current trends and apply them to last year's numbers.

Where do you find capital for expansion?
Certainly not the banks. I have done SBAs and they are just as tight as a bank now. So I look for private investors.

Is capital getting easier to access? Why/why not?
No. The money is out there but lenders are just shell-shocked. They want to make every effort to determine that you are a sound investment. The past serves as a good reason for them to be this way.

Have you used private equity, local banks, national banks, other institutions? Why/why not?
All of the above. You have to be creative in ways to look for capital.

What kind of exit strategy do you have in place?
I have a great life insurance policy.

What are you doing to take care of your employees?
I feel that I listen to their needs and try to give them the support they need to succeed.

How are you handling rising employee costs (payroll, healthcare, etc.)?
We have had to raise prices but only as a last resort. We have become frugal in our spending and had to cut some things, like Christmas parties.

How do you reward/recognize top-performing employees?
Public recognition, small bonuses, movie tickets, free subs.