Golden Corral's Pay Day

The chance to own and franchise helps keep Golden Corral's managers in their place.

By David Farkas, Senior Editor -- Chain Leader, 4/15/2005

Jeff Dopkins says Golden Corral pays him $28,000 a year to manage a unit in Fort Pierce, Fla., that rang up $5.2 million in sales last year. “There’s no alcohol, and the focus is all on food and service. It’s a good quality-of-life job,” he says.

But that’s not the only reason Dopkins relishes working for the 427-unit buffet chain. He received monthly bonus checks totaling $130,000 in 2004.

No surprise, then, that the 39-year-old GM intends to stick around. “Everything I do is for the long term,” says Dopkins, who managed casual-dining restaurants before joining Golden Corral in 2001.

Rounding Up GMs
It’s also not surprising that few GMs leave the company. General-manager turnover, for example, was a mere 8 percent in 2004, officials say. That rate is well below People Report’s industrywide average of 19 percent for 2003. Turnover rates for all levels of unit management at Golden Corral was 25 percent last year.

“The 2004 number includes people we terminated,” explains Vice President of Human Resources Judy Irwin, adding that “voluntary termination” runs 3 percent.

The company gives general managers the boot generally for one reason: poor performance. “If you are not approved as an operating partner, you don’t get to stay with us,” she says flatly.

Ownership Society
Golden Corral bestows the title of operating partner upon those who meet sales and profit goals during their first year as GMs. The company also requires that OPs-to-be put up $25,000 for five years, a sum that can be deducted through a payroll plan. The money is deposited in a non-interest-bearing account.

The immediate attraction is a 1 percent hike in bonus pay in the first year, which ramps up 5 percent during the next four years. But the biggest appeal is a shot at owning the restaurant itself. Golden Corral will sell the unit for the price it was worth the day of the OP’s appointment. In turn, the OP becomes a franchisee.

Officials valued Dopkins’ unit at $1.4 million in 2001. Considering current volumes, the restaurant veteran will get a very good deal on Jan. 1, 2007, the day he must decide whether to buy the restaurant. He plans to use the accumulated $25,000 as part of the down payment to a third-party lender.

Operating partners who don’t become franchisees after five years remain in their units and receive slightly bigger bonuses. However they don’t get another chance at ownership.

Already one of the system’s highest paid operating partners, Dopkins is eager to be his own boss. “Absolutely I’ll decide to become a franchisee,” he says.