My Plan to CONTROLAMERICA

During the past 30 years, Phil Romano has started no less than 20 different restaurants, several of which have become national chains. Since 1989, he has worked with B tinker International on restaurants like Romano’s Macaroni Grill, Spageddi’s and Cozymel’s. His latest concept. Eatzi’s, has turned heads in the restaurant industry by merging the grocery and restaurant businesses into what Romano calls a “restaurant meals market. ” D Business asked Romano to tell us about it.



People ask me, “What would you have done differently with Eatzi’s il you had it to do over again?” I say, “I probably would have opened a year earlier.”

I didn’t realize there would be such a pent-up demand out there. In my restaurants, I noticed that more and more people wanted their food to go. That meant that they stood at the bar while we packaged it for them. It was a pain in the neck. The food wasn’t meant to be taken out. I was giving them inferior food, which was messing up the flow in my kitchen while tying up a waitress who didn’t get tipped anyway. It wasn’t right. I saw the problem and decided to do something about it.

I knew that basically there were two places to get food today-restaurants and grocery stores. What 1 wanted to do was take the restaurant industry and the grocery industry and somehow bridge them together. The result is the hybrid-Eatzi’s.

But getting there was tough. First, I investigated the whole market and decided that I was in over my head. 1 knew ever}’ nook and cranny of the restaurant business, but the grocery business was a different animal altogether.

So I decided to get some expertise on board. I put a team together–some grocery people, some marketing people, some operations people. They needed to be there from the start so they could understand the various elements I hoped to bring together.

After that, I hit the road. For four months. I went all over the United States, took pictures where they allowed me to-even where they didn’t. There were some great places- some little bakeries, some stand-alone delis, some little chicken deals, some sandwich shops. There were some attempts to put all of these things together in grocery stores. But all of these things were just fragments of what would come together in Eatzi’s.

We took all these pictures and put them up on the wall. We’d look at them and visualize the things that we wanted. Then we started working on the design. I wanted the feeling of a great European marketplace. You have the opera music and the concrete floors. 1 also wanted to make a statement that we’re thinking about food here, not decor. Our food was going to be our decor.

One thing 1 discovered in the places that I visited was that most of the food was cooked behind closed doors. But where was the food made, who made it and was it frozen? It was all a mystery.

When I have a party at my house, everybody ends up in the kitchen watching what’s being cooked. This is the concept I’ve used in a lot of my restaurants. People like to see things that are happening, especially when they go into a restaurant. But most of the time you can’t see the kitchen. “What’s going on back there? Who’s cooking my food? Some kid in a baseball cap who was just cleaning the kitchen?” What are they trying to hide? It’s pitiful. The general public knows what they’re getting. They’re smart. I wanted truth in feeding.

I wanted people to see the manufacturing of the food right there. There’s a lot of excitement in manufacturing food-and that kind of excitement connects the customer to the process. That’s what I wanted to do with Eatzi’s. When you come walking in, the first one-third of the restaurant is manufacturing. You actually see our part in the manufacturing. You see it being done by chefs.

It makes a statement: “It’s fresh; the kitchen’s clean.” You tum around, see bakers; there’s a big oven. They even look like bakers. There’s this perception and right away, people say it’s got to be good.

We’ve been able to create a food culture. Not just a place where you buy food, but an actual culture created by the food. Eighty percent of what we sell at Eatzi’s we manufacture. The rest of the product, we buy to complement what we manufacture.

This food culture sets us apart from grocery stores. Most of the food that grocers have is food that they have bought. They box it, wrap it, package it, but they don’t produce it. Who are they going to have produce it? A mother putting her kids through college? A high school kid working a part-time job?

Not only do you need a chef creating recipes, you’ve got to have a chef executing those recipes. I try to take my staff into grocery stores and show them what we don’t want. 1 had a manager early on put Lay’s potato chips in the store. “What is this stuff?” I asked him. “The place looks like a 7-Eleven.”

He told me that Lay’s has the best chip in the business. “Campbell’s has the best soup in the world,” I replied, “but you’re not going to see Campbell’s soup on the shelves here. Get it out of here and don’t let that happen again.”

People say that we’re crazy, that our vision will drive our costs sky-high. We’ve gotten a lot of flak for our manufacturing concepl. That’s why I’m not afraid of anybody copying Eatzi’s. Because they’re afraid of putting 35 chefs under one roof. But there are not many places doing $250,000 worth of business a week in 8,000 square feet. Even though I don’t think anyone will copy us, I still worry that somebody will copy us and do it wrong- this is my biggest fear.

It took us a while to learn this animal ourselves. Il took us almost seven months to refine our concept and become profitable. 1 don ’( think anyone else has that kind of money to spend. They’re going to fall short, and when they fail, the industry will say, “Well, that’s a bad niche-that niche isn’t going to work.” That’s bad for us as we grow and think about things like an IPO.



PEOPLE COME INTO EATZl’S ON THEIR WAY HOME FROM work; they are drained-and first thing they see is all that action, the kitchen, the food. They hear the music and see the color and smell the smells. People are elbow to elbow. They see the whole thing, the masses moving to the right. And when people miss something, they don’t go back against the current. They go all the way around and make another loop again.

Our challenge was to take what we’d seen out there in those individual specialty stores, put everything together and not make it look like a food court. We’re a place where probably 80 percent of the food people come in to buy, they’ve already tasted. But we want 20 percent of our product to be something unique to them. We’re going to show it to them; we’re going to educate them; and we’re going to develop their palate. And then they will associate that food with Eatzi’s from that point forward.

In creating the Eatzi ’s hybrid, the main thing that I had to bridge was the difference between grocery and restaurant people. We had an ongoing debate between the grocery store managers and the restaurant managers. The restaurant managers won.

Grocery people take care of their shelves and expect the shelves to take care of the customer. That’s like giving your kid a video to watch instead of spending time with him. Restaurant people are more focused on the customer. You always see restaurant managers asking how the meal was. The only time you get to talk to Mr. Whipple is when you mess up his Charmin.

We did some focus groups, and they told us that, in fact, we had fine-dining quality food. Our average meal costs $7 to $8. If you had that in the restaurant, it would cost you $30. We’re cheaper than restaurants and more expensive than the supermarket. Which is exactly where we want to be.

We’re still tinkering with the concept, though. We’re going to start doing our own mustards and sauces because we think we can make it better than what’s already out there. We’re looking into catering, thinking about doing frozen meals- not in the grocery store, but where you can buy a week’s worth of iow-fat, low-cholesterol food, and we deliver once a week into areas around the city.

Eatzi’s has become a lifestyle for people. It’s a place to see and be seen. You come in the morning and get your coffee, read your paper; stop by on the way home. I really wanted that to happen. I even thought about having post office boxes in the back.

I specifically didn’t want to put in too much seating, because I didn’t want to confuse the customer. Ninety percent of everything that we sell at Eatzi’s is take-out.

Can you imagine if we had more seats? Women would be trying to shop with people watching them. It would be too intimidating. That’s why the seating we have is in the back and outside.

I think we were able to find the perfect location [Lemmon and Oak Lawn avenues]. What we wanted to try to do was to get within the core of the city itself. That’s where you get the recognition. That’s where you get the publicity.

Take Cozymel’s up in Piano. Out there, we are doing about S4 million a year in business. Everybody in Piano knows us, but nobody else in the Dallas area knows we’re even there. So what I’ve done-and I’ll do this in each city-is get in the core of the city, get recognized with publicity, and then when I go to suburbia, they’ll be waiting for me. People from suburbia come into town, but people from in town don’t go out to suburbia. So it’s important to get to the core first.

People keep asking me. “When are you going to put an Eatzi’s up in Piano? How about Fort Worth?” Well that’s just not going to happen for a while. It’s going to cost us just as much to put a store in Piano as it is in Chicago–and Chicago’s going to be one hell of a market.

My strategy is to plant our flag in as many different cities as possible. We’ve captured Dallas. We’re going to plant flags in Houston, then Washington D.C., Chicago. New York, Los Angeles. They’re talking to us about the basement of Macy’s in New York. I don’t know if we’re going to do that. That would be different and 1 don’t want to take any chances with Eatzi’s.

But what we don’t want to happen to Eatzi’s is for it to become overexposed. It needs to be like a brand name that’s available, but not all over the place. Otherwise, we start bastardizing ourselves. I don’t want people to get tired of Eatzi’s.

Recently we’ve been scouting locations, looking for the best possible areas in the United States. We hope to build two new Eatzi’s in 1997 and six to seven in 1998.

Of course, when you go into another part of the country, you have to consider changes in the tastes and styles of that particular region. No way we’re going to bring 35 chefs from Dallas to Los Angeles. We’ll bring two to three key chefs from here-and the rest we’ll hire in L.A.

I want us to be on the cutting edge, at the epicenter for creating a nationwide concept. We’re staffing up now. We’ve got a corporate office that costs $2.5 million a year, separate from Brinker International. We’re geared up to build maybe 12 to 15 more Eatzi’s without adding a single employee to the corporate entity.

1 ’m putting together a group of six chefs from around the country and giving them stock options in Eatzi’s. They will sit on an advisory board and tell me what’s happening in the food industry-what people like even before it can be labeled a trend. These are the people who will shape the food industry.

I want to work with these people the way that Sylvester Stallone and Bruce Willis do with Planet Hollywood. We’ll do a food book with everybody’s picture on the cover, like an Andy Warhol image with the Eatzi’s logo on the top. Inside, there will be recipes, and people will write what they think about the food. We’ll have openings, book signings, Can you imagine the impact?

Nobody’s going to be stronger in the entire United States. Just take 10 Eatzi’s. That’s over 200 chefs. We will have own peer group, with our own chef’s foundation, our own competitions and medals. If we have 20 Eatzi’s. that’s 600 chefs. That’s some kind of culinary power. We could control the taste of America.