Stone soup, microprocessors and poop: How BIGGBY CEO found success | LINK nky Article
Stone soup. Microprocessors. Poop.
This was how Mike McFall, co-CEO of Biggby Coffee, framed a free, public talk he gave at the Metropolitan Club last week. The talk was the first in a series related to his book Grind: A No Bull**** Approach to Take Your Business from Concept to Cash-Flow, which details some of the things McFall has learned in his 20 plus years in the coffee business.
McFall began his tenure at the first Biggby Coffee location in East Lansing, Michigan, as a barista, where he met his partner, Bob Fish. Founded in 1995, the company opened several locations in Michigan in the late nineties, before beginning to franchise in 1998. Biggby now has nearly 250 locations in nine states, according to McFall’s book. During his talk, McFall drew upon passages in Grind as well as episodes from his life to dispense what he hoped was down-to-earth and accessible advice for aspiring entrepreneurs. He spoke for about 45 minutes.
“What I’m going to talk about is what I know,” he said at the beginning of the talk. “I support people in opening businesses, the intention being that that business, that asset, will help contribute to that franchise owner building a life that they love.
“So, I’m going to try to make stone soup, microprocessors and poop make sense in that conversation.”
Stone Soup
Pulling a theme from an old fable in which a group of hungry travelers adds stones to a pot of soup to induce others to share ingredients, McFall began his talk with stone soup.
“What does that mean?” he asked. “What that means is you are, as the entrepreneur, the most important ingredient in the success of your business.
“The first part of that is attitude,” he continued. “If you show up in your business and you’re off, you’re having a bad day, you’re negative, your business will reflect that.”
Likewise, he said if you show up “and you’re positive and you’re energetic and you’re fired up and you’re ready to go, you’re ready to take on all comers, your business will reflect that.”
To illustrate this point, he spoke about how he used to call all of his new franchise owners after about a month and half of operation, a practice that his schedule—regrettably, he said—no longer allowed for.
“I probably did this for a hundred openings,” he said.
In his view, the new owners who tended to succeed were the ones who had good attitudes, in spite of the many difficulties associated with opening a new business. He admitted that he did not keep any records of this time, but he believed that the new franchisees with optimistic attitudes were the ones who went on to succeed.
“I don’t know if I know of an uber successful entrepreneur who’s pessimistic,” he said later on in the talk to hammer home his point.
In spite of this emphasis on optimism, he was forthright about the difficulties and stresses of opening a business: “If you are not ready to be the most dedicated, dependable person in your business for the first five to seven to 10 years, don’t get started.
“We went 10 years before [our business] made any money.”
His book offers an even starker portrait of the life of a new entrepreneur.
In the first chapter, he writes, “In a start-up, there are no days off. Maybe you head ‘up north’ every year for a week in August, or travel to see family over the holidays. Sorry. The family traditions have to be put on hold. There will be no vacations or holiday breaks until you get that cash to flow, and flow for a while.”
The trade-off is that people working with and for the new business owner will notice the dedication and model their own behavior after it.
Still, he’s careful to let his readers know what they’re getting into.
“Are you willing to try harder at your new business than you have ever tried at anything in your life? Are you willing to be the most dedicated and dependable person in your start-up for seven to 10 years? If not, stay home,” he writes.
“Opening a business because you want freedom is a myth,” he said at the Metro. “Sure, 27 years later I have a fair amount of freedom in my life, but I was grinding for 15, 20 years.”
In short, the life of an entrepreneur isn’t for everyone, and people should think very carefully about the sacrifices they’ll need to make when opening a new business.
Poop
So… what about poop?
“Sell more sh** tomorrow than you did today,” McFall said to open the second part of his talk. “That’s the secret to being a successful entrepreneur.
“My partner and I have woken up for 27 years trying to get better at selling cups of coffee. Every single day.”
This single-minded focus is reflected in his book as well: “We don’t have soups, salads or sandwiches. We don’t have beer and wine. We didn’t roll in an elaborate gelato offering. This is all a mess, and they get in the way of selling one more cup of coffee,” he writes.
“Pick your one product and become world class at delivering that one product,” he said during the talk. “And then sell the shit out of that one product.”
In his view, many new entrepreneurs try to make things too complicated by getting distracted with gimmicks, trends or worse, an overly elaborate catalog of products, especially before the business is scaled enough to handle it. Better to keep it simple, he argued.
For Biggby—although the restaurants do have a variety of offerings on their menus—the one product that McFall has tried to sell the sh** out of is what they call “sweet bomb lattes.” You won’t find that terminology on the menu; it’s a catch-all term for all of the restaurants signature lattes, loaded with sugary syrups: mocha, caramel and so on.
In truth, it took a while for McFall to realize what Biggby’s singular product was. At first, the coffee shops struggled to get a foothold in the market. By McFall’s telling, no one was buying the more traditional coffee drinks. Everyone was coming in to get sweet bombed. Thus, McFall and his partner rearranged the menu to highlight the things that were selling, and their cash flow took off. Increasing sales didn’t require any fancy techniques or data-driven plans. It required the identification of a flagship product that could get people in the door.
As a contrast, McFall relates a story of about a high school friend of his who invested in a pizza shop. About two years into the business his friend came to him and pitched the idea of opening a Biggby’s within the shop in an effort to drum up some more business. The problem was that the business was struggling.
“This guy can’t figure out how to sell pizza,” he said. “And what you’re going to do to solve the problem is you’re going to add complexity and make him figure out how to sell another product?”
Focusing on a single product will bring more success, McFall said.
“That’s not sexy,” he said, speaking of his own experience. “That’s just hard work.”
Microprocessors
“What’s the number one complaint of business owners in America?” McFall posed to the audience.
Someone in the front row shouted, “Staffing!”
“There’s only ever been one time in a hundred times I’ve asked that question and someone has yelled, ‘taxes,’” he responded, laughing.
“People is the biggest challenge of business,” he went on, describing the complaints of business owners he’s heard over the years. “This is what it sounds like: kids today… nobody wants to work… everybody’s lazy.”
“I promise you,” he added, “there’s nothing wrong with kids today.”
At this point, McFall gave his view on today’s labor conditions, claiming that he had a way of rethinking how companies treated their employees, such that it was the “most powerful productivity hack since the microprocessor.”
He made the case that many managers have unrealistic expectations about their new hires.
“They [managers] wait around for that star employee to show up that’s going to solve all their problems,” he said. “That star employee doesn’t exist.”
Instead, “what we need to do is we need to build environments that people show up into and encourage them to thrive,” he said.
This isn’t the first time that McFall has expressed his views on the labor market, offering his two cents on to everyone from The New York Times to Forbes. An advocate of so-called conscious capitalism, McFall has instituted a round of employee retention policies at Biggby in an effort to reduce turnover and help employees reach their long-term goals, including paid sabbaticals, standardized compensation and career coaching.
Speaking to the entrepreneurs and managers in the audience, he said, “It’s our job as leaders to make the investment first.” Otherwise, they shouldn’t expect their employees to invest their time and effort into their businesses.
To do this, he said that the corporate workplace needed to become “a petri dish of self-improvement.”
“Why don’t we turn our environments inside of our businesses into loving, nurturing, supportive environments?” he posed to the audience again.
To that end he described Biggby’s coaching curriculum, which focuses on four main points:
- Physical, mental and spiritual vitality
- Creating a sense of belonging and community
- Exceeding basic needs, which he said focuses mainly on financial literacy and management
- Visioning and long-term goals
“What we’re talking about here is unlocking people,” he said, “in order for them to pursue the life they love. And if we can do that, the organization will thrive.”
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