Retention: Goodwill Is as Goodwill Does

Bubba Gump’s philanthropy aids not only sea turtles and disaster victims, but also hourly retention.

By Mary Boltz Chapman, Editor-in-Chief -- Chain Leader, 4/1/2006

To aid Hurricane Katrina victims, Bubba Gump President and CEO Scott Barnett (l.) cooked for a fund-raiser...

...while unit staff in Long Beach, Calif., hosted a radio broadcast and toy drive.

At Bubba Gump Shrimp Co., the decision to share time and money with charitable organizations is a no-brainer. Take the Lahaina, Hawaii, unit for example, which the San Clemente, Calif.-based company says is the busiest restaurant on Maui but is surrounded by many needy locals. “If we didn’t contribute, it would be ridiculous,” says President and CEO Scott Barnett. “We make a lot of money in that restaurant, and there’s a lot of need in that community.”

Bubba Gump will open this year in Hong Kong, Los Angeles, and Orlando and Fort Lauderdale, Fla. As did every restaurant so far, each will give half of its opening-day revenues to a local charity, which could amount to $40,000 or $50,000. Bubba Gump’s average unit volume is $8 million.

After, the 15-unit, casual-dining chain encourages continuing that relationship and building others. It charges each unit’s marketing manager with keeping active in the community.

Local Heroes
But do such efforts affect unit employees? “If they’re inclined to be participative in community involvement personally, then I think they probably applaud what we do,” Barnett says. “If you’re not inclined, you just might look at it and say, ‘Yeah, that’s a good thing.’”

Director of Recruiting Holly Rocco is even more convinced. “We do think that our company’s community and charity involvement affect employee retention because our employees truly feel as if they are part of something bigger than them,” she says. “We are a company that really wants to do great things within the communities that we operate in, and to have such wonderful employees that also value the same thing is something really special. They feel that giving back is woven within our culture, and that is a huge reason why employees choose to stay with us.”

Bubba Gump’s hourly turnover is about 180 percent; executives point to the seasonality of many of its locations for the high figure. Management turnover is only 19 percent, and the company has lost only two general managers in the past six years.

How Can We Help?
Renee Bodenstab, marketing manager at the Long Beach, Calif., unit, says workers ask for ways to help out. “They’re the ones that come up with the ideas. Last Christmas, the staff came to me and said, ‘We want to do something for the community.’” Because the restaurant is located across from the Aquarium of the Pacific, the employees sponsored two classes of schoolchildren to go to the aquarium and take the educational tour before heading over to Bubba Gump for lunch. “The staff just had the best time hanging out with these kids,” she adds.

Bodenstab says the aquarium offers a lot of opportunities for staff to participate, including an annual Sea Fair benefiting ocean conservation, which Bubba Gump sponsors, and fund-raising dinners for which the restaurant contributes food.

SNAPSHOT

Concept

Bubba Gump Shrimp Co.

Headquarters

San Clemente, Calif.

Units

2005 Systemwide Sales

$127 million

2006 Systemwide Sales

$150 million (company estimate)

Average Unit Volume

$8 million

Average Check

$12 lunch, $18 dinner

Employees

2,343

Expansion Plans

4 in 2006

After Hurricane Katrina, the Long Beach unit hosted a KOST 103.5 radio broadcast to raise funds and support a toy drive. Unit employees served breakfast and helped prepare donations for My Stuff Bags, which distributes gym bags of toys and other goods for needy children, hurricane victims in this case. Bodenstab says the staff had a great time with the event. She’s not surprised because having fun and showing customers a good time is part of their job.

“The people that we hire are always willing,” Bodenstab says. “They always want to volunteer. They don’t have to, but they want to.”

National Matters
Giving doesn’t only happen on the unit level. Companywide, Bubba Gump contributes to several charities. For example, in 1997 the company got involved with Sea Turtle Inc., a South Padre Island, Texas-based organization that protects Kemp’s ridley sea turtles. Bubba Gump began by donating 2 cents per meal to the program. “It may not seem like a lot, but up to this point, we’ve probably given them close to half a million dollars,” says Barnett, adding that the company expects to contribute about $100,000 this year.

A recent effort helped Bubba Gump’s own employees. After Hurricane Katrina, the company established a foundation to help the employees of the New Orleans unit, which finally reopened in December. Five days after the hurricane, employees found each of the 130 workers affected and gave them $500. The rest of the almost $250,000 raised was distributed over the next few weeks according to need.

“If you have a group of people who care about others, and they believe that being part of the community is important, whether you’re a company or a person, that communicates itself among people,” Barnett explains. “Hopefully that’s what people believe here, that we’re doing the right thing. That if we’re involved in a community like New Orleans, that we aren’t just there to operate a business and make profits, but we’re involved in other ways, too.”