Texas Roadhouse: Culture & Opening Process

This is a snippet of the transcript, sign up to read more.

Since you touched on that expansion from 200 to 600 restaurants, how much more white space is there? What's the long-term target?

Regarding US growth, there's still some room. Texas Roadhouse has always been smart about ensuring that when they decide to build a restaurant, it will be successful. Very few restaurants in the company's history have opened and then closed due to poor sales or performance. This strategic approach to building new restaurants has been a key to their success. Every restaurant that Texas Roadhouse opens tends to outperform the competition and meets the company's expectations.

This is a snippet of the transcript, sign up to read more.

What's the average population size they're looking at, assuming there are no unique factors like a military installation?

I would say they're looking at attracting at least 30,000 to 50,000 people. That way, even though there may be competition, Texas Roadhouse still feels there's enough population to support the restaurant. One of the things that sets Roadhouse apart is that once they enter a market, even if there's an Outback or a LongHorn or another steakhouse, they tend to capture market share quickly. This is due to their basic recipe for success. Fresh food. Everything is made from scratch. Nothing is pre-made or frozen, and that's why even as a dinner-only concept, people are there at 9:00 in the morning, cutting meat, making everything fresh, so that when we open, that's today's food. It's not something defrosted and heated in a microwave. I think that makes a big difference to the consumer as well. You can taste the difference when it's fresh and homemade.

This is a snippet of the transcript, sign up to read more.

So there's a team of basically full-time trainers that do this?

Yes, and as the restaurant matures, my restaurant had 10 people who were able to go out on the road because they had gone through a training program and participated in restaurant openings. I believe that was another aspect that Texas Roadhouse encouraged—people wanting to move forward and be part of it. It was a very elite group of people who worked extremely hard, probably putting in 60 hours a week. The benefits of being part of this culture included not only taking the knowledge you have but also sharing it with others. I think this always stemmed from Kent Taylor being a servant leader. This philosophy trickled down through the executive staff, market partners, managing partners, and even to the hourly staff, to help the new employees. We didn't just leave them on their own; we nurtured them to be as successful as we were. I also had several people who went into management after starting as hourly employees. This culture of servant leadership from top to bottom and back up is why the company is so successful. It was different from any other company I had been involved with.

This is a snippet of the transcript, sign up to read more.