How Cameron Mitchell’s Ethical Approach Fuels a Restaurant Empire
On the afternoon we talked, commotion and activity filled the background setting as Cameron Mitchell’s eponymous restaurant company moved into its new office building. His personal office, which overlooks his beloved hometown, is a far cry from his first “office,” the dining room table in his mother’s condo where he drew up plans for the 1993 opening of Cameron’s of Worthington, the debut restaurant in what’s become the premier upscale-dining empire in Columbus, Ohio.
From his dysfunctional youth (Mitchell dropped out of high school at 15 and ran away from home, only to return his junior year with—at best—a lackluster attitude) to the moment when, at 18, he did a 180-degree flip “from working for beer money and going nowhere, to being the hardest-working guy in the kitchen, with the best attitude,” Mitchell has channeled his rebellious tendencies and decisive nature into entrepreneurial expertise.
“My goal, at 18, was to be president of a restaurant company; it was never about being a chef,” explains Mitchell, a graduate of The Culinary Institute of America in Hyde Park, New York. “Going to culinary school and becoming a chef was just a stepping stone to get to my goal—I figured if I was going to be president of a restaurant company I better know a little something about food, so that’s why I did it. I became executive chef, at 23, of a white-tablecloth restaurant here in Columbus, became general manager at 24, and, by the time I was 26, we had opened four restaurants and I was overseeing the front-of-house operations at those four restaurants. By the time I was 28 [the company] had six restaurants.”
And then another epiphany hit: It was time to start his own company. The year was 1992, and “with a legal pad, a pen, a couple thousand bucks in my bank account, and a one-bedroom apartment on the north side of town,” he spent three weeks writing out the company culture and values. “Somehow I was smart enough to know I wanted it to be about the people and the company’s values, and not about me. I’m still doing that today, building a restaurant company wrapped around our company culture and values.”
He opened a restaurant a year for the first four years, then decided to build bigger restaurants, opening two of his most iconic concepts in 1998: Mitchell’s Fish Market and Mitchell’s Steakhouse. “I built 22 of those restaurants over the next 10 years, and then sold them to Ruth’s Chris Steak House in 2008 for $92 million,” he says, noting that the deal reduced his group’s portfolio to 18 restaurants. “Now, we’re at 52 restaurants and are a $250 million coast-to-coast restaurant hospitality company. We’ve got an incredible company culture, and yes: I’m an entrepreneur in the truest sense. I love the business. It’s been a good run—a lot of hard work and a lot of stress—but a good run.”
What is your management style?
I’m definitely more of a macro manager. This is a business of a thousand details, and I’m detail-oriented—I have to be—but by the same token, I don’t like the minutia. For example, my desk is spotless; I have nothing on my desk except for a computer screen and my telephone. That’s kind of the way I operate, I don’t allow myself to get caught up in the minutia. I get great people to take care of it for me.”
You’ve said that any business has to have a mission and goals, what are yours?
Ours is quite simple: to thrive with fiscal and cultural responsibility. As the CEO of a restaurant company, you’d think my No. 1 goal would be to make a profit, but it’s not.
Our No. 1 goal is to maintain our company culture and values. We want to be around 50, 60, 70 years—and the only way we’re going to do that is to be a values-driven organization. I call it a 51:49 relationship: 51 percent of our goal is to maintain our culture and values; 49 percent of our goal is to make a profit—and make a damn good profit. We will never go for profit at the expense of values; I always leave a penny or a dollar on the table before I’ll sacrifice our values.
We have many goals, but the one that never changes is: to be better today than we were yesterday, and better tomorrow than we are today.
Tell us about your company values.
The core value statement that is most important to us is that our associates come first. You’d think I would say the guest comes first. We all know the Nordstrom rule: Rule No. 1, the guest is always right; Rule No. 2, refer back to Rule No. 1. In our organization, I don’t believe that.
In fact, I’ll even be as brazen as to say I don’t think we have a direct relationship with our guests. We have a direct relationship with our associates; we work with them day in and day out. They’re the ones who take care of our guests, and so I look at it as a triangular relationship: We take care of our people; our people take care of our guests; our guests will take care of our company. It’s not that I don’t care about guest services—it runs deep in my heart and I love to take care of people—but in order to achieve great guest service, we have to take care of our people first.
We have 4,000 associates in our company and we hire the same people everyone else does. The difference is we treat ’em great. They aren’t numbers; they’re real people.
A simple example of that is if an associate says her parents are coming in on Saturday night and she’d like off, we’d say the same thing every other restaurant company would say: If you get your shift covered, you can have Saturday off. The one thing we say that’s different is: If you can’t get the shift covered, plan on taking it off and just let us know. We’ll get it covered for you, but you try to get it covered first. What happens then is she’s not going to call in sick or lie to us. And, lo and behold, next week when we’re jammed up and others call in sick, she comes in extra to help us out.
It’s that Golden Rule, that two-way-street management that creates an unbelievable work environment. We have some of the lowest industry turnover and the average length of tenure on our management team is 16 years. That’s how we deliver genuine hospitality.
How is your restaurant group structured?
We operate like a holding company. There are four pillars of our business: our specialty restaurant group, our national brand Ocean Prime, our sister company Rusty Bucket Tavern, and our catering company. In the specialty group there are 11 concepts with a total of 14 restaurants, and we’re opening three more this year and six are slated to open in 2018. Ocean Prime has 14 locations, coast to coast, and Rusty Bucket Tavern has 24 units in five states.
The Rusty Bucket Tavern is a different partnership, but we run it and operate it through Cameron Mitchell Restaurants (CMR). One of my original partners asked me to help him start a sports bar, and I brought in one of our general managers at the time, Gary Callicoat, to run it. (I dated Gary’s sister for six years, and she and I didn’t work out, but Gary and I did.) CMR takes a 5 percent royalty fee/management fee and owns 25 percent of the Rusty Bucket. Gary runs the day-to-day operations and CMR does virtually everything else—accounting, real estate, development, marketing, human resources.
The catering business we just sort of backed into. We got so many requests and it was taking so much of our time that I asked one of our general managers if she’d start a catering company for us, which we did in 2002, and last year it did $15 million. You add up the top five caterers behind us in Columbus and, all totaled, they probably wouldn’t do that much, so it gives you an idea of our market share.
The point is: We’re a $250 million company and catering is less than 10 percent of our business—but here in Columbus, our $15 million is a big deal for us, and it’s highly profitable. We just spent $1.2 million expanding our catering facility. We now have a 20,000-square-foot catering facility with kitchen, offices, a huge warehouse, and eight trucks.
You have a Marcella’s opening in Denver this summer; how did you decide on Denver?
We have two of these little Italian restaurants in Columbus, and the one that is doing really well is the more urban, downtown location, so we wanted to try it outside of Columbus in another urban location. We have an Ocean Prime and Rusty Bucket in the LoDo district of Denver, and we originally thought we’d do another Rusty Bucket. But this is an urban location and Rusty Bucket is more of a suburban concept, so we decided to do a Marcella’s. It will be our first Marcella’s out of town—and this is a great hip young neighborhood in Denver, right across from the downtown—it’s going to be pretty cool.
Speaking of young and hip, the Millennial Concept Challenge—which lets your employees conceive and develop an actual restaurant—sounds really interesting.
I’m not sure exactly where that’s going, but hopefully it’s going to birth a new concept or two for us. Want to know the story behind that challenge? When I started the company, I was 30 years old and some of the young managers I worked with are now our senior leaders. I had four or five managers over six or seven restaurants then, worked closely with all of them, and knew them all by name. Now we have 52 restaurants and roughly 300 managers in our group, and I barely even know the young managers. We have management conferences and I try to get to know them, but I don’t get the exposure to them and they don’t have the exposure to senior management like when we were starting the company. I want to close that loop, bring them back in. I want to provide a great education and exposure for the young managers and connect with the millennial group at the same time so we can stay abreast of what they want.
I’m not sure exactly how this will finish, but I know I’m on the right road—just not sure where we’re going. The excitement in these young people is unbelievable. I’m sure we’ll do some pop-up concepts from this, but I’d love to see us go all the way down to bricks and mortar.
Here’s the other thing: We’ll spend $4 million, $5 million, $6 million to open a restaurant—we spent $10 million to open in New York—but when I opened my third restaurant I spent $600,000. And I never spent over $1 million to open the first five restaurants we did. But we couldn’t open a restaurant like that today and have it be a Cameron Mitchell Restaurant because people would say, “What is this?”
I want to come up with something like Cameron Mitchell Legacy Brands—and I don’t have a name yet, I’m just thinking—but something where we provide the capital for these young people to build restaurants. I’m thinking they’d have maybe a $1 million budget to build. Then people could expect the Cameron Mitchell hospitality but not expect the Cameron Mitchell build-out, because they would know it’s these young people in the millennial group who are doing the restaurants.
And I could even see part of the profit from this group being cycled back into education for young people, or going into building more of these $500,000 to $1 million restaurants. That’s kind of my long-term vision for it, but we have to take these baby steps first and see how it goes.
Do you have any insights on the outlook for the restaurant industry? There have been some gloom-and-doom reports and predictions of a restaurant bubble.
Well sure, I’ve read a lot of that stuff. Clearly, casual dining is having a difficult time—the grocery stores and fast casuals are nipping at their heels hard. No doubt about it that landscape is changing. Casual-dining brands, including our Rusty Bucket, were down in sales last year. It just causes you to roll up your sleeves and work harder.
I think a recession is coming—whether it comes in 2018, ’19, ’20, or ’21—I don’t know. We worked through a huge one a few years back; it’s not the end of the world—you just pull back on development and tighten up the hatches. I’m always optimistic. Competition makes you be stronger, more creative, and work harder, and that’s a good thing.
We’re also in a difficult labor market. Labor costs are more expensive, but on the flip side of the coin: Inbound food costs have been lower. So we’re offsetting some of those increased labor costs with lower food costs and some other lower operating costs.
When you run a business, it’s always one thing or the other. The only time I really got scared, or saw profit be really changed, was when gas went to $5 a gallon. Anything that got delivered to restaurants—I don’t care if it was pencils or produce—we were being charged a lot more in fuel surcharges. And people were spending less money because they had to spend so much for gas. That was the only time we really felt pinched, and I don’t see gas shooting up to $5 a gallon any time soon—if ever again.
Do you have new concepts planned?
Yes. We’ve signed a commitment for a new restaurant in 2018 in downtown Columbus, where I’ve got four restaurants already. This one will be in a new nine-story office tower that’s going to overlook downtown. We’re going to have a 5,000-square-foot restaurant on the first floor and a 4,000-square-foot deck restaurant on the roof. Columbus doesn’t have that now, and these rooftop experiences are a hot trend all over the country. The question is: What concept bodes well to have the main restaurant on the first floor and the bar, with cocktails and appetizers, up on the roof? Right now we’re thinking it probably leans more to a Mediterranean or Spanish type of cuisine. Nothing’s cast in stone just yet; we’ve signed the lease, just not sure about the shape or form of the restaurant.
Do you have plans to do any hybrid business models?
I’ve tried to stay focused on full service. Everybody and their brother is throwing darts at the fast-casual segment … and I think we’ll stay out of that fray. But my millennial friends might convince me otherwise.
What do you do to relax, or achieve work/life balance?
Well, I always tell people I’m about as deep as a baby pool. I have my wife of 21 years and three wonderful kids, and I play golf. I like to say I have not been to work in 20 years—I may go to work every day, but golfing, traveling, working are all the same to me because I love working.