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The Honolulu Advertiser
Posted on: Monday, March 19, 2007

Leadership corner

Full interview with W. Randall Schoch

Interviewed by Curtis Lum
Advertiser staff writer

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W. RANDALL SCHOCH

Age: 50

Title: Chief executive officer

Organization: Desert Island Restaurants, Hawai'i franchise holder for Ruth’s Chris Steak House and Romano’s Macaroni Grill

Volunteer position: Chairman of the Arizona Chapter of the Young President’s Organization

Born: La Canada, Calif.

High School: La Canada High, Calif.

College: Chaminade University

First Job: Lunch busboy for Bistro on Kapi'olani Boulevard

Little-known fact: Always dreamed of being a football coach

Inspirational figure: Father Damien

Major challenge: Dealing with government agencies

Hobbies: Hiking, surfing, fishing, skiing and spending time with family

Books recently read: “1776,” by David McCullough

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Q. You started off as a busboy. Did you plan on a career in the restaurant businesses, and did you ever envision yourself where you are now?

A. That was a way to pay my bills. That was how I survived. I never set out when I was very young to go to hotel and restaurant college. I came up kind of in the school of hard knocks, working in restaurants. I probably worked in four or five restaurants as a busboy. I always thought that I would go to college and work for a big company like my dad. He was a big-corp., company guy. But I just got into the restaurant business and one thing led to another.

Q. What brought you to Hawai'i?

A. I moved to Hawai'i when I was very young, just a year out of high school. I had done pretty well in the restaurant business on the Mainland. I always wanted to go to Hawai'i and surf, but I didn't want to vacation in Hawai'i; I wanted to live there. The restaurant business is the largest private employer in the country and the second largest (after) the federal government. The hotel and restaurant, hospitality and travel business really drove the economy in Hawai'i, and so I got caught up in all of that. It was very exciting to be caught up in the beauty of Waikiki.

Q. What was your first job here?

A. Back then it was 12 to 14 percent unemployment. I had to accept a lunchtime busboy job at the Bistro on Kapi'olani, two days a week, and eventually got to be a full-time busboy (at Rex's) and dinner busboy, and moved up to be a front-door host and then a waiter and a captain. Within two years, I was the head captain of Rex's Restaurant on Kuhio.

Q. How did you make the jump from being a waiter to management and then ownership?

A. I just worked real hard and was the guy who was willing to do that. Westin Hotels, which was called Westin International, actually recruited me away to go over to the Wailea Beach Hotel on Maui in 1979. I thought I'd give it a try. I really enjoyed that and learned a little about the corporate structure, but I still had the desire to go back and finish college. But the hotel life wasn't the life for me, and Kihei at that time was pretty sleepy for a single guy. So I went back to O'ahu, and Rex Chandler had just bought Nick's Fishmarket — which was quite the hot spot back then — and he wanted me to help him with it. He brought me in as the captain, which was like the head waiter. After a few weeks, he moved me to the general manager job.

Q. How did you advance into the ownership (Nick's Fishmarket and Black Orchid) aspect of the restaurant business?

A. I didn't know anything about business. I knew how to run a restaurant, but I didn't know anything about finance or reading income statements. In those days, they didn't get managers involved in that stuff. You just ran the restaurant, and I was good at that. I realized I wasn't going anywhere with this so I went to real estate school and I just had this epiphany of what it takes. I started to understand what people were talking about and I started to grasp who my customers were. My customers in that day was everybody who was anybody, all the big shots in Honolulu. I knew them all. I'd talk to them about their businesses and was a sponge for what they were teaching me. But I didn't understand most of it because nobody ever taught it to me, so real estate school kind of helped me place things together. Then I started really going to these guys and saying, "How do I get to the next level?"

Q, Did you have any role models?

A. Whether it was Chris Hemmeter, Jimmy Reynolds, Jack Myers or Alan Beall, just a lot of the successful business developers of the day, and these guys I'd see once a week, twice a week, and I was a 22-year-old kid and they were glad to give me advice and help me. Basically, they coached me in how to leverage a position of having (Nick's Fishmarket's) owner at the time, who was Pat Bowlen, finance a position of me taking an equity stake in the restaurant. ... I ended up getting in the game and making that transition, puncturing through from being an employee to being an employer. I bought a $250,000 stake in a restaurant with $500 in my pocket.

Q. What's the biggest challenge for you?

A. The biggest challenge, no question, that anybody has is finding great people and surrounding yourself with great people and then working with those people to create a culture that permeates throughout your system. I've been really, really blessed to have Paul Ah Cook with me for the last five years, who's our vice president for Hawai'i. I've had restaurants that started off on the wrong foot; we brought in the wrong people, not in Hawai'i, but in other places, and that's very hard to unwind. Most people in my company are far better at doing a lot of things than I am, whether it's financing or marketing.

Q. The restaurant industry is very competitive. Do you have any advice for others?

A. My secret really is I've kind of become entrepreneurial while being corporate at the same time. I want systems and controls and brands that are very tight and controlled, and that's why we brought over Macaroni Grill and that's why Ruth's Chris has so much power — because it's a national, secure brand. My philosophy is to run a very professional operation, use common sense and create a brand. You've got to create a brand, even if you're one restaurant. You don't build a beautiful restaurant and put tape on the window that says "Closed Sundays" or "Looking for help." Why don't you spend $200 for a sign?

Q. What do you see in the future of Hawai'i's restaurant industry?

A. We have a little niche cottage industry, and what we do is we really enjoy bringing great Mainland concepts to Hawai'i, and we enjoy bringing the culture and cuisine and style from Hawai'i to the Mainland.

We have the Ruth's Chris and Macaroni Grill brand. We think that we can build two to three more Macaroni Grills at least. We're going to open this next Ruth's Chris in Waikiki, and that gives us five. I think we're pretty much done with Ruth's Chris in Hawai'i.

I'm always looking around for different opportunities to bring something else to Hawai'i, but it's got to be the right thing because the cost of construction in Hawai'i has gone through the roof, the cost of occupancy has gone through he roof. Clearly, with all the different laws involving employees, they're much more expensive, and bringing the product over is much more expensive. So, to create the right return on your investment you've got to be very selective in what concept you should bring over because the margins can be very, very skinny, and if you're not able to create the right return for your investment group or your bank, then that might not be the best place to go ahead and do that.

Reach Curtis Lum at culum@honoluluadvertiser.com.