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The Honolulu Advertiser
Posted on: Sunday, July 5, 2009

Business sizzles with $6 beef plates


By Taylor Hall
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser

Richard Craft named his business after his son, Blaizen, 9, right. His Blazin Steaks concept was the right fit for the time.

DEBORAH BOOKER | The Honolulu Advertiser

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AND THEN THERE WERE 17

Founded: 2005

Owner: Richard Craft Jr.

Number of outlets: 17

Outlets in the works: 6

First store: Windward Mall food court

Steaks cooked in a week: 2,100 lbs.

Rice per day: 100 lbs.

Origin of name: Richard's son, Blaizen, now 9

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Four years ago, Richard Craft Jr. was selling steak plates out of a tent on Kapi'olani Boulevard. He didn't go to college, never owned a business and didn't know how to cook a steak. Today, he is the owner and founder of Blazin Steaks, which has opened 16 restaurants in less than two years, riding the popularity of its $6 steak plates.

And the 36-year-old Kailuan has done all this during a recession.

Two years after he and his fiancee opened their first store in Windward Mall, Craft is opening restaurants faster than ever. When asked how many restaurants he has, Craft had to pause — "15 ... I think."

Actually, No. 16 opened last week in Pearl City and No. 17 opens tomorrow in Mililani. Craft also has outlets on Maui, the Big Island and on the Mainland. And he plans to open six more restaurants over the next few months.

While businesses across Hawai'i are closing their doors, Craft keeps expanding.

"The economy is not what affects us," Craft said. "It's better for us because landlords are giving the property longer and with a better rate."

A SILVER LINING

Lean economic times do present opportunities for the right kind of business, said Mike Hamasu, research and consulting director at Colliers Monroe Friedlander.

"It's a good time in the marketplace to think about expansion," Hamasu said. "How often do you come across a $6 steak meal? They have a product that's attractive for the times."

Craft said he named Blazin Steaks after his 9-year-old son Blaizen, altering the spelling slightly. He currently controls all his outlets but is turning his business into a franchise operation.

He said he leased a majority of his early locations from General Growth Properties. More recently, he has worked with several other leasing companies including Colliers.

"What I have is every management company calling me up and saying 'oh, I got this space' and I just go there, say 'yeah' and fix it up," Craft said. "They want a Blazin Steaks, otherwise they're just losing money (without a tenant)."

Craft moves to new locations fast and cheap. He targets past barbecue and Mexican restaurants since they have much of the same equipment and zoning. That just leaves cosmetic changes which usually cost around $40,000 for start-up. He also needs only three employees to a shift and orders meat on a per-day basis to avoid waste.

The most common problem that Craft encounters when deciding on a potential location is a lack of parking. "We rely on volume. So if you have a parking lot with three stalls, you'll die. People take one look, (see it's full) and drive on by," Craft said.

With a goal of 60 Blazin Steaks in the next two years, Craft joked that he's turned to the Mainland for potential storefronts because he's running out of Hawai'i locations.

He opened restaurants in Los Angeles and Las Vegas last month. "What I'm going to do is to see which one does better," he said. "If it does really good in Vegas that's great because there are so many super cheap restaurants, so I can just add 20 in one year. And because it's big, they wouldn't even be really close to each other."

Craft now employs about 200 servers, partners and cooks, but that's increasing with each location.

"Having multiple locations can be an advantage," said John Butler, faculty director of the Family Business Center of Hawai'i and professor of management at the University of Hawai'i-Manoa. "Advertising, overseeing corporately, that's the same whether you open one location or 10."

Craft's concept is right for the times, Butler added.

"Franchises where you can get reasonable meals are going to do well in this economy," he said.

Craft said he knew he was on to something when soon after opening his first store at the Windward Mall food court the business was bringing in $10,000 a month.

"Everybody (other foodcourt vendors) was so nice when we moved in, talking to us, asking us how we were. As soon as we opened, nobody talked to us anymore. Our line was out the door," he said.

KEEPING CONTROL

This was when Craft first started to get inquires from people who wanted to open their own Blazin Steaks. However, Craft wanted control over each location so he opted for a business structure in which he retains ownership but contracts with proprietors taking care of the day-to-day operations.

"I honestly would say that if I was running every store myself, I would be bankrupt," he said. But because each store has one person in charge, the company has been able to continue to expand, Craft said.

Despite some rough patches with partners, Craft has yet to close a location.

"No stores close, because I don't let them. They are all in my name and I believe in the product, so if a store isn't doing well, I will buy the proprietor out and redo it. It always does better when it's under new management," Craft said.

One of the first people to approach Craft about opening a location was Justin Sasaki, a Realtor for Hawai'i Property Group who has run Blazin Steaks in Waikiki since November and intends to run a store planned at Pearlridge.

"I was a flight attendant with Aloha Airlines and got laid off because the company closed down.Then I worked at The (Honolulu) Advertiser, but then they laid me off," Sasaki said.

"And I was so frustrated, depending on other companies to support me, that I just thought — you know what — I'm going to try and do my own thing."

That's when his wife told him about Blazin Steaks, and he signed up.

Craft has about 20 proprietors who run his restaurants. But now he's converting his business to a franchise network, Craft said. All partners will have to sign retroactive franchise agreements, which should be finished in the next few months, he said.

Craft is depending on a consistent Blazin Steaks experience to move him and his company to success in markets outside Hawai'i, but he does have concerns about his new Mainland audience.

"Nobody eats rice in the Mainland," Craft said. "So were going to try it with rice, but if we have to (switch), I've made contact with some Mainland suppliers."

Craft said he has already made contact with potato suppliers in case he needs to add them to the menu, although he wasn't yet sure how he would serve them.

"When Hilo Hattie opened in Disneyland, they found that it was a lot of people from Hawai'i living in California and that they bought their aloha shirts and stuff there. Then, when they opened one in Disney World in Florida, it was a completely different demographic," UH's Butler said.

However, Craft feels that the audience for Blazin Steaks is more universal.

"People ask me, 'Are you sure you want to go to L.A. and Las Vegas?' But, our stuff is not a Hawaiian thing like plate lunches, like L & L (Drive In)," Craft said. "Everybody eats steak. Everybody eats chicken and fish."

Craft is branching Blazin Steaks out beyond stands and restaurants with Blazin Steaks Bar and Grill.

His Kunia location is awaiting a liquor license, and Craft has plans to open three more under the bar and grill concept.