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📰 "Ten Months of Pain and Hope"

Masters of Scale: Rapid Response

Photo by Jon Tyson / Unsplash

Table of Contents

Host: Bob Safian
Guests: Danny Meyer, Restaurateur & Founder, Shake Shack
Category: Biz & Tech | 📰 News

Podcast’s Essential Bites:

[1:15] “People in our company were getting sick, and it didn't feel safe coming to work. We're losing money while we're being unsafe, while we're not making people happy – that's kind of a triple loss.”

[1:30] “This industry employs more people in the aggregate than both the auto industry and the airline industry combined. The problem is that, because there are 670,000 independent restaurants in cities and towns all across America, it's a much harder thing for the public and for lawmakers to get their arms around.”

[1:54] “If we want to see our economy back, I promise you, the restaurants are going to have to be a leading edge of that. This is going to be a really good time for first-time restaurateurs. But it's going to be a really painful time for the restaurants that built out these very expensive stage sets to have to walk away from all that investment, and to walk away from the restaurant communities that they've created.”

[11:32] “[W]e had actually built our team back up, having cut our team back in March from 2,300 people down to 175. And then another shift all the way down to 75, and another shift all the way down to 45 before rebuilding it back up to 350. Now we're back down to about 100 employees in our company. We're just trying to make it to the other side. The good news is that because of the vaccine, this time we see light at the end of the tunnel. We know that the weather will get warmer again in the spring, which means we will be able to serve outdoors. And we really, really believe that by June enough New Yorkers will have been vaccinated that we should be able to get back into the business.”

[21:20] “I'm an optimist at heart. I think if you just kind of stop and dwell in what's challenging about all these choices, you won't be able to move forward. I've thought a lot about where we're going and less about where we've been, just because it doesn't help me, but every now and then I think it is important. It's kind of like when you've been standing in line for a long time to […] order your food at Shake Shack, sometimes it's helpful to look at all the people behind you in line to see how far you've come.”

[26:05] “For our industry, we're accelerating things that we needed to do a long time ago. We have always been teetering as a full-service restaurant industry on the edge of bankruptcy. We truly have been. We were founded on two principles that are no longer relevant. One is cheap rents, and the other was cheap labor. Our industry was founded on not paying half of its staff members because the tipping system pays for that half. Our system was based on inexpensive real estate. Well, guess what happens when real estate goes up, and you start to pay people what they're worth?”

[26:45] “We've convinced the public to pay up for responsibly raised animals and responsibly grown vegetables, but we still have not persuaded the public to responsibly pay for talent. When you start to see those two major expense areas come way, way up and, there's so much downward pressure on your pricing ability that you can't charge for it, your system's broken. And all it takes is COVID to just knock you out for good.”

[32:31] “[Post pandemic,] I know for a fact that people are going to want to go out because I see people shivering with five layers, sitting under electric heaters with icicles coming down their nose while they're trying to enjoy their glass of wine, between putting their mask on and off. I think people cannot wait to get back into restaurants and celebrate love, and life.”

Rating: 🍎🍎🍎🍎

🎙️ Full Episode: Apple | Spotify
🕰️ 36 min | 🗓️ 01/21/2021
✅ Time saved: 33 min

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