The Trials and Tribulations of a Successful Restaurant Owner
When introducing Steele Platt, founder and former CEO of wildly successful chain Yard House, at the recent Nightclub & Bar Show, Jon Taffer got straight to the point:
“Steele Platt is a warrior. He gets up time after time after time.”
Anyone who has spent 38 years in the industry is going to experience ups and downs and Steele Platt has certainly not been an exception to that truth. Steele has seen great success, to be sure. After taking hospitality classes at University of Denver, he opened his first restaurant in 1985. This venue served 80 percent food and 20 percent alcohol and made $1.8 million dollars in the first year. However, Steele saw the potential in alcohol sales. He thought to himself, “My next concept, I’m going to flip it: 80 percent alcohol and 20 percent food.” Over the years, he opened multiple restaurants, moved to California only to find himself in Seattle selling cars.
That would have been the end of Steele’s story had he not paused one fateful day and told himself that he was no car salesman, he was a restaurant owner. The restaurateur returned to California and began applying for bartending jobs, BSing his way in by listing the bars he had once owned as establishments at which he had served as bartender. It became glaringly obvious to owners and managers that he was no bartender, however, and in 1993 he declared personal bankruptcy.
Steele viewed his bankruptcy as both rock bottom and the motivation to get back up yet again. In 1994, he began writing the business plan for what would become Yard House. Within just six months, the seed money for the venue had been raised. Steele also took advantage of tenant improvement allowances to help defray the costs of opening the first Yard House, located in Long Beach. He then came up with his in-your-face Wow Factor: taps right down the middle of the venue.
For subsequent locations, an additional Wow Factor has been the Yard House architectural statement: visible beer lines over the top of the bar. Focusing on the Long Beach location, Steele’s first Yard House made $3.2 million in its first year. It may seem odd but Steele attributes some of that success to his decision to only play handpicked music. As he put it, he was not about to ruin his business by placing the music in someone else’s hands.
It took 16 years for Yard House to grow to a chain 46 locations strong and things didn’t always go smoothly. “This business is jumping hurdles every day,” Steel told the rapt audience. And jump them he did, and quite successfully: the average sales for each Yard House location per year is $9 million. Steele Platt went from selling cars to declaring personal bankruptcy to bartending to creating a chain worth $585 million, proving the following Jon Taffer statement to be very much true:
“The moment you think there is no future, you're wrong.”