Southern Hospitality: It's the Secret Sauce for this Multi-Concept Operator

Thomas "Tab" Broome got an early start in the franchise business, going to work for a restaurant group in Raleigh, N.C., about 30 years ago.

At the time, the company ran a string of Darryl's restaurants (which looked a lot like Applebee's, only with a little more variety and flair), a group of 11 Pizza Inns, and The Angus Barn steakhouses. General Mills swooped in and bought the pizza places and family restaurant business, and Broome got a chance to work for a large restaurant corporation.

They offered me a job, he says, but it would have required him to move to Florida. That wasn't a change Broome wanted to make. Looking back, he has no regrets. General Mills later sold those businesses and better things were opening up for Broome in North Carolina.

He signed on with Scottish Food Systems in Laurinburg. The company traces its history back to 1964, when Edwin Pate, Jr., signed a franchise contract with Harland "Colonel" Sanders and a contract with Hardee's Food Systems.

Ten years later, Broome decided to go into business for himself and bought his own restaurant. After four years, he had firsthand knowledge of every aspect of running your own food operation. "When you're not in a franchise operation, you basically do it all," he says.

The most valuable lesson, perhaps, was that he felt best suited to be working for Scottish Food Systems--and he went back. In 2007, with the company's president retiring after 23 years at the helm, Broome was promoted from company vice president to the top job.

Before Broome ever took a job at a company, though, he had plenty of experience with hard work. Growing up on his grandmother's farm provided the kind of down-to-earth lessons in good work habits that still guide his career. And it's helped steer his two brothers through successful careers of their own.

At 51, there are still plenty of challenges ahead for Broome. But through good times and adversity, he has been learning every step of the way. Some of that know-how is on display in every franchise restaurant operated by Scottish Food, where the secret sauce for success is good old Southern hospitality--a standard Broome helps establish every day at 27 KFCs and 8 Pizza Inns.

QUESTIONS

Name: Thomas A. "Tab" Broome
Title: President
Company: Scottish Food Systems Inc.
No. of units by brand: 27 KFCs and 8 Pizza Inns

PERSONAL

Age: 51
Family: Married to Beth, 29 years; daughter, Brooks, in college
Years in current position: 2½
Years in franchising: 26

Key accomplishments: For the past year our company has been running under 80 percent turnover, which is very low for the industry. On another point, in '07 and '08 our brands had the highest per-store average in sales for multi-unit franchises in the U.S. We've grown some high sales in the last few years.

Biggest mistake: As far as I'm concerned, learning how to manage people early on. I sometimes allowed employees to stay in positions longer than I should have after learning they had lost their motivation for the job.

Smartest mistake: Buying an independent restaurant and running it for four years. The experience taught me numerous valuable lessons. Most importantly, I learned how to survive building a business, marketing, advertising, everything.

How do you spend a day typically? Up early to review sales trends in my home office, looking over the night report from the previous day's records. Exercise. Then getting to work to do normal administrative stuff. I try to spend some time daily in some of our restaurants.

Work week: We are in a lot of advertising co-ops. Most weeks we have some type of co-op meeting. I'm out visiting restaurants. Our company pushes community involvement and I'm involved in some community affairs. And I'm in the office early trying to get some things done.

Favorite fun activities: I love golf and offshore fishing. We're 30 minutes from Pinehurst.

Exercise/workout: I go to the gym three or four times a week. I love playing golf as much as possible and there's the treadmill and light weights.

Favorite stuff/tech toys: I'm not much of a tech person but I do love my Blackberry.

What are you reading? I haven't read a book in six or eight months. I read all the trade magazines and articles and there are writers I follow.

Do you have a favorite quote or advice you give? Build people, and sales and profit will follow. That's what I tell my people all the time. We believe that we're successful at this through the people we have, not because of the systems we have.

Best advice you ever got: I've gotten a lot of advice. I've had three or four special mentors. One of my first was Sam Burns. His quote was: "The early bird gets the worm." That's what he kept telling me. Good work habits are critical to success. He instilled that in me.

Formative influences/events: I grew up on my grandmother's farm and I started working at 11 or 12 years old. Learning how to work and manage money at an early age, that was the story of our success.

How do you balance life and work? I believe to achieve balance and success the two must intertwine. When I'm with my family I'm never too far from work and when I'm at work I'm not too far from my family. You have to be committed to both sides.

MANAGEMENT

Business philosophy: Treat your employees with the same respect as your customers and they will move your business forward. Allow them to do what they do best. I've always wanted our employees and company to be the best. I'm not looking for average. I tell people that when they start interviewing. I'm also fearful of failure and that is a motivator for me.

Would you say you are in the franchising, real estate, or customer service business? Why? Customer service. Both of our brands--Pizza Inn and KFC--have delicious food when it's prepared by the book. What's taken sales to a whole different level is good, Southern hospitality.

What gets you out of bed in the morning? The challenge of building a business.

What's your passion in business? Watching people develop. I want to continue to build a company in which an employee says they treat you like family and they want you to be successful. Being best is about hard work and discipline. My goal is to inspire employees to be great at what they do.

Management method or style: Treat everybody as equal. Never talk down to a person. I see my role as one of leadership, inspiring store management and upper management to stand above the competition, where at the end of the day they feel like owners.

Greatest challenge: In the last four or five months, with the economy where it stands, staying disciplined to the principles that got us where we have gotten to, realizing that you have to give up margins to ride this storm out. I think a lot of people in this business have raised prices way too high. We tried to stay as low as possible. That's a challenge, to know that discipline has to take over.

How close are you to operations? I'm very close. I'm active in all of the big decisions. I have a director of marketing and of operations, and we discuss all of the major things that are going on. I know from my office about everything going on in the field.

How do others describe you? I asked my director of marketing to answer that and I think she was honest with me: confident and self-assured, driven, considerate, kind, sincere, progressive, forward-thinking, and sharp.

How do you hire and fire? I personally conduct multiple interviews. I don't hire unit-level people anymore, but I did at one time. We do multiple interviews and extensive background checks for hourly as well as management employees. I never hired anyone where I wasn't convinced--and they have to want it, too. We try to make sure neither side makes a mistake. I never fired anyone who didn't know it was coming and given fair warning, unless it involved an ethical issue.

How do you train and retain? We have many systems in place that motivate our employees through recognition and rewards. I feel that people are searching for the tools to be successful and we try to supply them with those tools. The average tenure among general managers is 15 years. For our associates and assistant managers it's 10 years.

BOTTOM LINE

Annual revenue: I don't disclose that.

2009 goals: We want to grow 4 percent in sales this year in both brands.

Growth meter: How do you measure your growth? My philosophy has been to be patient, have the right people in place, and build one or two locations a year--and that's if you can find "A" locations.

Vision meter: Where do you want to be in 5 years? 10 years? I want to be known as the best-run restaurant company in the United States. Whether we have 100 or 500 restaurants doesn't matter.

How is this economic cycle affecting you, your employees, your customers? Our customers seem to be more affected than the employees. Our payroll is the same as last year. We've tried not to cut back or only cut back slightly in hourly roles. We've taken care of our key people. They got raises. Nothing has changed for them.

What are you doing different in this economy? I'd say we're watching manageable budget items and we're working a little smarter when it comes to expenses.

How do you forecast for your business during these trying times? I look at the current trends and I project from those numbers. That's a monthly thing that changes as the world changes. The 4 percent growth we're looking for was done in October and we still expect to reach those goals.

Where do you find capital for expansion? We're self-funded with no debt. If needed, we have credit lines with partnering banks.