Death in the Family

Simple physics: money spent on marketing equals foot traffic in. S&A "disappeared" on most of our screens relying on reputations for having a neat parking lot or great shrubs outside. That just didn't cut it. Unlike Starbucks which was born with a flawed chromosome but kept on life-support well past its end-of-life, S&A was simply neglected and left in the capable hands of tax attorneys when it could have received a transplant. I have no sympathy for abandonment.

I have spoken with many people in the industry over the past two days. Many have worked for the company at some time, others watched it as a competitor. Regardless of which, everyone felt a sense of loss at such a once-premiere company disappearing from the scene. There are lessons for all of us. I am not sure that a lot of us can focus on the lessons until we get the remorse behind us. Many people pay the price when an owner makes so many bad, long term decisions.

Lane, The obituary metaphor was so creative of you. July 29th was a sad day, and the "aftershocks" were felt across the country by many. It is my belief that the company was never able to recover from the LBO. I remember how we used to complain about Pillsbury, but in hindsight they kept the company prospering except for the Chili's misjudgment. I know I speak for many people who worked for S&A during its expansion years (17 years and 3 office buildings for me), that we thought of it, as not just a place to go to work, but as a family. I grew up there personally and professionally and treasure the good times. Luckily,our department still remains friends despite working for other companies which screams volumes.

You were too polite Lane! And I'm sick of stories talking about how the economy did them in.

Lane, I was shocked as well that they choose to file chapter 7 not 11 odd? It seems that when the momentum of a chain begins to diminish, and starts feeling the pinch of competition. Those in the “know” or money men replace the leadership with Industry veterans that listen to or are accountants. Then the wheels start to come off. We have seen this time and again. I for one miss gentleman like Ken Dennis; when sales slowed he pushed for more marketing dollars, new products and new customers. Yes, then things were turned around even in a crowded field which he operated. However, our industry has been acquired by hedge fund managers with a focus on hitting the number or making the desired metric. Old savvy marketers know it is about the consumer who drives the momentum in all chains today just like they did in the past. Ah things don’t change that much.

It is with a heavy heart that all of us who were a part of something so very, very special and so very, very fun a long, long time ago witness the demise of these two formerly great chains. The day Metromedia took over was day of infamy for everyone involved in both chains. When lawyers, accountants and myopic, bottom lined focused people try to run restaurants the end result is always the same. I feel for the folks in those restaurants, the operations people, who had to endure year after year of ignorant, greedy, and short sided decision making at the top. We've seen it before and unfortunately, we'll see it again. You can't sell overpriced, poor quality product, served by unmotivated people in run down, dirty places forever. I'm amazed they lasted as long as they did. God bless Norman Brinker and God bless all the folks who worked so hard to build those chains in the first place.

I wonder how many that make their living in some type of leadership position in this business had a start in or under someone that had a first or second generation starting job with S&A. I started waiting on tables with them in 1969 in Austin when the Kensington Club was $3.95. I just had a nice visit with Roy Nunis, the man that hired me. I also got an old meat clever menu from him. Their saga certainly proves that staying on top is hard then getting to the top!

Grizz The Coke-Cola metrics were critical to a first step too wellness. Other researchers and consultants came in and it was EGO (they knew better) and lack of money (a solid viable plan) that denied this chains success. Legacy industry veterans without a spine or vision can not lead a company from the past to the present. I believe there are several others out there with the same type of leadership today. Restaurants that are STUCK in the MIDDLE will come to the same results! I agree, more money should be sent on customer research than lawyers.

Not that many years ago, as the story goes, an indivdual in Bennigan's marketing recommended to managment that they move to a frozen food kitchen so they could cook almost everything in a microwave.And another benefit: They woud need fewer "coos." If so, the beginning of the end began!

Lane - I was intimately involved with the Bennigan's brand on the franchise side. Your statement should read "In this case the leaders were able, but the owners didn't have deep enough pockets to make them able as well". The assets were aged and needed a MAJOR refreshing. The menu needed an overhaul as well. In 2003 Coca-Cola performed a consumer dining occasion segmentation study that placed Bennigan's in the "Social Comfort" segment with Friday's, Chili's, Applebee's and O'Charlie's. We, in our group, did not act on any metric presented. As a whole, service was poor, food was just as bad, and management at the store level uninterested in the pursuit of excellence (we can all take the blame for that). I'm actually not sad to see them go because my experience with them was very negative. I saw no hope and no future for them...

It is so sad to see a once proud name like Bennigan's and Steak & Ale go under in this way.

I would guess it will be a Ground Round situation where the franchisees are able to acquire the brand rights and operate it collectively. Jeff...you are so right. In this case the leaders were able, but the owners weren't willing.

Lane, great that you took the time to salute S&A's legacy. I can still remember when all the top Restaurant execs would come to Dallas to "check out this new thing called the salad bar"!. unfortunately the best concepts cannot succeed without evolution and leadership.

What if anything survivies? Franchisees have viable businesses or they would have closed before this, right? Is this Ground Round all over again? It will be very interesting to see this play out.

Wow, Rick. You're making someone nervous.

Richard B. (Rick) Berman is a former labor management attorney and restaurant industry executive who currently works as a lobbyist for the food, alcoholic beverage and tobacco industries. He is the sole owner of Berman & Co., which sponsors many front groups that defend his corporate clients' interests by attacking their critics, allowing his paying clients to remain out of public view. He is the President, Executive Director and Director of the Center for Consumer Freedom (CCF). CCF's 2005 IRS return states that Berman works 23 hours a week for the group for which he is paid $18,000. [1] In spite of its name, was more concerned about industry than the consumer. He is also the Executive Director and President of both the Employment Policies Institute Foundation and the American Beverage Institute. [2] According to a July 31, 2006, profile of Berman in USA Today, his company has 28 employees and takes in $10 million dollars a year, but "only Berman and his bookkeeper wife" know how much of the $10 million ends up in their own pockets. [1] RICK HAS ENOUGHT MONEY! LETS START FOCUSING ON OUR CUSTOMERS AND EMPLOYEES!