Spur Steak Ranch

Tough, and loving it
South Africa’s Spur Steak Ranch restaurant chain is expanding around the globe. Pierre van Tonder tells Gay Sutton how the organisation’s people are motivated to drive that success.
There is undoubtedly a strong element of glamour involved in running a successful restaurant chain, and the Spur Steak Ranch chain is very successful. Launched some forty-three years ago by its current chairman, Allan Ambor, the Spur Corporation runs a total of 315 restaurants in South Africa—and in spite of the recession it’s still expanding both at home and in the international arena. At the last count there were thirty-five restaurants in Africa, Australia and the UK and there are more in the pipeline.

The Spur Steak Ranch is a very strong brand, a value-for-money family restaurant with plenty of activities including a club exclusively for children, and food that is designed to tempt both parents and kids. When the first restaurant was opened, family eating was more or less unheard of. But during the Seventies, lifestyles changed, children were taken out to eat and the brand we know today emerged, evolving and innovating to fit and capture the family market. After more than forty years, Spur is seeing a third generation of satisfied grandparents, parents and children coming in through its doors.
“Great food, great environment and great atmosphere are just not negotiable if you want to run a successful restaurant, they are a given,” explains Pierre van Tonder, who has been group managing director for the past fourteen years, and has guided Spur through a considerable period of growth. “But if you want to take your brand concept and grow it, you’ve got to have the human capital to drive the feeling of the brand in terms of its intangibles.” Every person working for you, he says, has to believe in the brand and live its philosophy, creating the atmosphere and environment that will attract customers to return again and again.
Motivating staff to do this is not easy, though, because once you look beyond the glamour of the environment—the smiles and good cheer of the front of house staff—there lurks a very taxing lifestyle and a great deal of hard work. When other people are enjoying a weekend off or an evening out with friends, the restaurant staff have their noses to the grindstone. It takes a special type of person to do this.
In South Africa, most of the Spur Steak Ranches are run as franchises, while on the international scene, the majority are owned by Spur Corporation (in tandem with partnerships), which then appoints suitable managers or partners. But in all these cases, the franchisees and the managers are vital in maintaining the brand philosophy.
When selecting and appointing such essential people, Spur goes through all the normal practices of due diligence: application forms, business plans, financing, references and so on. “We’re very scientific in all of that but we find that the science doesn’t always deliver the necessary results,” van Tonder says. “So once we’ve gone through those processes, we have a cooling-off period. And this is something I learnt in Australia. We put the prospective franchisee into a restaurant for two weeks, to see if he or she can adapt to the cultural shock.”
The cooling-off period immerses the applicant in all aspects of the restaurant’s operations, from the dishwashing through to floor management. “During that time, we assess whether the applicant is dynamic, can work hard, has a clear understanding of the industry requirements, and if he or she has a deep passion to make the business succeed,” he continues. “We can also see if he or she has the backbone to lead and understand rules of engagement. That is very important in this business.”
The element of leadership is extremely important, perhaps more so than having the outgoing personality usually associated with the service industry. “I have some franchisees who are lacking in personality,” van Tonder explains. “But what they do have is a great respect and understanding of the brand, and they surround themselves with happy people who can integrate with the consumer and make them feel happy.”
It is also a company policy that both franchisees and managers have to understand the working of the restaurant from the front door to the back door. Although van Tonder is now group managing director, he began his career with Spur some twenty-four years ago as a trainee restaurant manager, learning the ropes in all areas of the restaurant before advancing up through corporate management. “As a restaurant operator I’m sometimes stunned that in many companies, the overall restaurant leaders have little understanding of what happens beyond the kitchen doors, and just leave it to the chef,” he says. “We don’t operate like that. Our guys go through what some people call boot camp training. It’s hands-on training, and it’s critically important.”
Once in place, the successful franchisees and managers are provided with back-up by a corporate team of people who support them, and help them to progress the business. “There’s a horrible crass joke that begins ‘I’m from head office and I’m here to help...’ I’ve always been very wary of that type of approach. Our advisors are indeed from head office but they are genuinely there to help,” van Tonder says. The assistance they give covers a very wide range of topics from developing marketing plans, through financial reviews to the all-important HR issues. Meanwhile, the usual tools of management are put in place, such as incentive schemes to motivate the staff, clear budgets and a range of key performance indicators (KPIs).
The philosophy of engendering an understanding of the restaurant business into the staff, meanwhile, extends well beyond the restaurant managers, and includes those in areas such as marketing and production. Spending time working at the coal face gives them the tools and the skills to do their jobs, teaching them at first hand what the customers are looking for and how the brand satisfies their needs.
“This is especially important in today’s highly competitive business world, where so many other restaurants are offering burgers and chicken, and making a wide variety of special offers. We want our staff to ask: ‘what is our point of difference? What is our point of interaction with the customer? How do we look after the kids and family and how do we make them come back again?’ It’s all in the manual, but we have to take it out of the manual and put it into our people.”
The lifeblood of the business is the customer, and Spur spends a considerable amount of money on market research, keeping up to date with changing tastes and trends in family eating and entertainment, and specifically what they think about the restaurants. “Then we dissect that and decide how the restaurants should evolve.”
Innovation is also one of the cornerstones of the company. Some new food lines have been an enormous success; for example, over the past six years a whole range of Mexican dishes has been introduced. Proving to be very popular, the line is continuing to evolve and respond to changing tastes.
Not all new innovations have worked, though. “We spent an awful amount of money about six months ago on a gourmet burger that was the flavour of the month at that time, but it didn’t work for us. We’d done all the research and put all the ticks in the boxes, but the customers were just saying ‘give me what I’m used to’. So it’s a difficult one, but you’ve got to keep your eye on changing trends.”
The company is lucky to have a lot of young people in the business, those who are up to date with the latest trends in parental thinking, and who understand first hand what entertains and attracts the modern child. And this changes very rapidly indeed. “What is good today may be out of vogue tomorrow,” van Tonder says. “But we have kids in our business who keep putting the pressure on and saying, ‘we don’t like this or that product’.”
All of this seems to have worked. At a time when many restaurants are experiencing great pain from the recession, Spur is feeling the effects of shrinking disposable income and lower footfall, but it is still retaining a strong market share. Part of its strength, van Tonder believes, is the relationship the corporation has built with its franchisees and staff. And Spur is currently making further investments in them. “Other companies may say ‘we’ve got to cut our cloth, let’s reduce staff complement’. That’s not what I would recommend. We are spending more in supporting our restaurants,” he says.
The other element of success in such times is providing consistent value and quality to the customer, and he drives that through every detail of the business. “For example, I go mad about toilets. If someone walks into a restaurant and the toilet is not in a tidy state, they’re going to think the kitchen is the same. Every detail is important,” he emphasises.
The company is still growing, both in South Africa and internationally. In the UK alone, a new restaurant was opened in Derby recently and another will be opened in Aberdeen in October. But for van Tonder, Spur is built around its people. The brand is very strong and constantly updated, but it is the people, relationships and the brand DNA that make it a success.