Pub Crawl

Pub Crawl

HOSPITALITY by Mark Gordon | Managing Editor

After 15 years of deliberate growth, a pair of lifelong friends running a bar and grill chain are about to pass $11 million in annual revenues. Expansion throughout the Gulf Coast is up next.

Mike Gowan and Mike Quillen have long been drawn to the restaurant business.

Pals since they started playing tennis together when they were 10-year-olds, the pair's first business was teaming up as teenagers to valet park cars for a few trendy eateries on Siesta Key. Even though they started as mere car-parkers after their boss suddenly left the job a few days into it, Gowan and Quillen took over the business.

They made it a profitable venture despite some hurdles - Quillen admits he technically didn't even have his drivers' license when they started out, for example - and later began working inside restaurants. But toiling for chains and independents in greater Sarasota just fueled Gowan and Quillen's desire to run their own place some day.

The friends took their dreams from talk to action in 1992, and now, nearly 15 years later, Gowan and Quillen are running Gecko's Grill & Pub, a small, yet steadily growing chain of restaurants and bars in the Sarasota-Bradenton market. The fourth Gecko's opened earlier this year, in the Palmer Ranch area of Sarasota County; the company also runs three bars under other names in the area: Hurricane Mike's Saloon, The Clubhouse Tavern and the Red Barn Bar.

Gecko's per-store revenues have grown about 10% a year over the last three years, reaching a company-wide total of about $7.65 million in 2005. With the addition of the new restaurant, a more upscale version of the chain in a strip mall off Clark Road in Sarasota, Gowan and Quillen expect revenues to reach $11 million in 2006. And what's more, the chain's net profit was 10.25% in 2005, more than double the industry average of 5%, according to the National Restaurant Association.

It took six years to open a second store, in 1998, and then another four years to launch the third store, both of which are in Bradenton. Still, the owners plan to expand north, possibly to Brandon, and south, toward Fort Myers-Naples. Other potential locations include North Port and the Ellenton-Parrish area. Overall, Gowan, 48, says they hope to have at least 10 stores along the Interstate 75 corridor.

The growth has taken a deliberate crawl-like pace for two reasons: First, the owners say they wanted to make sure the business model was working, and, past that, Gowan and Quillen were preoccupied running the ones that were open.

Long before mapping out growth projections, Gowan and Quillen, 47, realize they've succeed where many others have failed: Industry estimates on first-year restaurant failures vary, from as high as 90% to as low as 25%; the restaurant association says it's likely closer to one-third. "We've had a continuing growth pattern," says Gowan, "and that's hard to do in this industry."

The heart of everything

Both Gowan and Quillen are soft-spoken and humble when reflecting on their enterprise. They each have an aw-shucks attitude about success, attributing it to simple hard work, some luck and dose of help from friends and family, both of the financial and labor kind.

"We're just local guys who like to take care of people," Quillen says. "We are not totally driven by the bottom line and we're not looking to make a quick buck."

In the late '80s, however, Gowan and Quillen were looking to stop working for others. They had worked at some of Sarasota's most well known establishments - Gowan at Marina Jack and Quillen at Steak and Ale. They had done all the tasks, from bussing tables to supervising staff.

Gowan and Quillen had talked about owning their own Cheer's-like kind of bar and restaurant since they were teenagers. Quillen's father had owned a similar bar in Jacksonvillem and ultimately it was a $120,000 loan from Quillen's father that got the partners going on opening the original Gecko's.

They worked at the original store for as much as 15 hours a day when it first opened, and like previous jobs, they did it all, from serving the drinks to re-stocking the glasses. Gowan says clearing tables was especially helpful from a business perspective, as he was able to get visual research on what menu items people liked and what ones they didn't .

For about the first five years, either Gowan or Quillen were always at the restaurant. They had five other employees, as well, but they were trying to figure things out, from menu items to daily planned activities, such as Bingo and team trivia. They also were developing their customer service model of running the friendly bar around the corner. "In the beginning," Gowan says, "we were in the heart of everything."

Rough lease

Getting to the point where they let others do more of the labor was the first - and still sometimes on-going - challenge Gowan and Quillen have faced in growing the restaurants. Like other entrepreneurs in dozens of other industries, the partners struggled with letting go and watching others do work they had previously done.

One tonic for that was having some family members work in the business. Gowan's mom handles bookkeeping at the Landings restaurant, his dad has the same job for the State Road 70 location and his wife, Tonya Gowan, handles public relations and marketing for the entire chain. Also, Quillen's wife, Mary Quillen, processes the weekly payroll. Gowan and Quillen both say putting people they trust in important positions has been a big plus.

Gowan and Quillen learned some other lessons about the business side of running a restaurant from the experience of opening the original Gecko's. For example, the initial lease they signed for wasn't exactly owner friendly: It had a clause that Gowan and Quillen had to give back a gross percentage of their revenue to the owners of the shopping center: So, the more they made, the more they kicked back. "It looked good at the time," quips Quillen, rolling his eyes at how un-savvy he was once.

As the Gecko's brand has become more commonplace in the Sarasota-Manatee market, so to has the partners' ability to control lease negotiations and clauses. "We feel we have a lot more negotiating power now," Gowan says. "We are like a second anchor in some of the places we are in."

The partners have also learned from their time working in other restaurants. Well aware of the industry's high employee turnover rates, Gowan and Quillen try to retain workers by giving as many employee perks as they can. For example, each full-time employee gets two days off a week, not a given in the industry. Also, all employees are sent to several training classes, for topics such as food handling and alcohol awareness training.

Gowan and Quillen also practice and preach treating every employee with respect, another aspect that's not a given in the industry. That includes even the delivery people and suppliers who drop off food and beverages. "Our back door is our front door," Quillen says.

The success, both in growing the business and running the current restaurants, have brought Gowan and Quillen several other opportunities, including franchising in other areas and opening new company-owned eateries. Still, while they may open more restaurants in their next 15 years as opposed to their first 15, they plan to grow with the same humble, hard-working philosophies.

"Every day someone has a deal for us," Quillen says. "But we have to be comfortable with what we do. If you get big too fast, you lose control."

Some fail, some don't

The restaurant industry has long been known as a leader among retail operations in failures and bankruptcy filings. The Cornell University School of Hotel Administration, one of the most-respected research schools in the country, analyzed the industry in a report released last year titled "Why Restaurants Fail." The report breaks down elements of success and failure, many of which can be utilized for any business. Highlights include:

Success Elements:

• Focus on one concentrated theme. Develop it well.

• Be willing to make a substantial time commitment to both the restaurant and family life. "One successful owner refused to expand his business into lunch periods because he believed that his full-service dinner house was demanding enough from his family," the report states.

• Create a cost-conscious culture, including stringent record keeping.

• Educate managers through continuing education. "An environment that fosters professional growth," the report states, "has better productivity."

Failure elements:

• Frequent crisis-level problems. "Managing operations by putting out fires seems to be a common practice," the report states.

• Lack of match between restaurant concept and location. Don't put a nightclub across the street from a police station - an actual example in the study - or a family-style restaurant in an urban setting.

• Negative consumer perception of value; price and product must match.

• Lack of sufficient start-up and/or operational capital.