Andrew Jaffee – “Sometimes, Success is Getting Out of Your Own Way”
Featuring Andrew Jaffee, Founder of Sports Bar Marketing Rule #1: Break the Inertia Rule #2: Be Vigilant of Theft Rule #3: Don’t Fear the Wrong Things Andrew Jaffee grew up in the restaurant industry. Raised in the beautiful, sea-side community of Marblehead, MA just north of Boston, his first job was as a soda jerk […]
Featuring Andrew Jaffee, Founder of Sports Bar Marketing
Andrew Jaffee grew up in the restaurant industry. Raised in the beautiful, sea-side community of Marblehead, MA just north of Boston, his first job was as a soda jerk at Friendly’s ice cream shop. Then he went to college at the University of Chicago and discovered Chicago-style stuffed pizza. Not only did he fall in love with it, he decided then and there he wanted to be the pizza emperor of the world. After taking a few classes, he got his first job as a manager at Pizza Hut.
“So there I was in 1987, wearing a brown polyester uniform with shorts, plaid sleeved shirt and slinging pizzas 15 hours a day. It was the longest, hardest year of my life. Fortunately, I got promoted fairly quickly into a training position and got to not smell like pizza dough for a little while.”
That early part of Jaffee’s career was fundamental. The work he did for Pizza Hut as a line manager and a training manager still informs the way he does things today.
Next, Jaffee and a buddy opened a chain of upscale billiard clubs because, in the early ’90s, playing pool was the thing to do. “We built six of these gorgeous 12,000 to 15,000-square-foot clubs with 30-35 nine-foot regulation pool tables, a kitchen and a bar. It was a neat operation.”
For six years, Jaffee was the Director of Operations for the group. “That was the last job I ever had because from that point forward, I was self-employed.”
From there, he went on to open his first restaurant that he called The River’s Edge. This time, due to a lousy location, the business didn’t take off as hoped. “We failed colossally. Epically.” Like so many restaurants in the industry, Jaffee and team became one of the statistics no one wants to become. Learning from that experience was important, however, and gave him perspective on what so many restaurant owners go through.
Moving beyond restaurants. Sort of. But not really.
Not one to let a little disappointment stop him from trying again, Jaffee then turned his learning experience into knowledge that helped him be more successful in his next venture. He opened a place with a friend called Score’s Legendary Sports Restaurant – an incredibly high-volume, 23,000-square-foot sports bar in San Mateo, California. For a year or so, they ran a really big business, but when the “dot-bomb” exploded in 2001, it took a lot of business down with it.
“Needless to say, that hurt business. There was an ad that ran for a while that said, ‘Yesterday I was a 27-year-old millionaire. Today I’m just 27.’ And it was true.”
But that location was instrumental in the creation of his current business. As any sports bar owner knows, keeping up with what sports programs are on when and where is critical to running a successful location. At the time, Jaffee was using a service to try to help him decipher all of the various sports programming options, but the provider they were using just didn’t perform very well.
Jaffee said, “They didn’t understand what I, as a restaurant operator, was managing on a daily basis. I thought to myself, “You know what? I can do this.”
So Jaffee went out and bought a Dell computer, a Radio Shack headset and started making cold calls saying, “You need what I do. I know what you do and I can help you.”
Jaffee said, “My wife and I made a deal that if I couldn’t pay my share of the bills within 90 days, I had to go get a job. So I worked my behind off and built a business, and within the first two or three years, we bought a competitor, doubled in size and reached 1,000 subscribers.”
Today, SBMX has 32,000 subscribers. What makes SBMX so successful? Jaffee explained, “It’s exhausting to them to have to then go and figure out what’s on and make sure they know what specific games are available at certain times and, then to inform the staff. It’s just work. What we do is give them an easy-to-use tool. We are able to make them experts in sports and it makes their lives so much easier.”
Jaffee gets pretty clear indications from his customer base that what he says is true. In addition to the less than 1% churn rate – which is pretty unheard of – he relayed, “I was at a restaurant in San Francisco when the host asked for my name for the list. When I told her, she said, ‘Andrew Jaffee?’ When I said yes, she said, ‘My name is Beth and I’ve used your product for years.’ Then she came out from behind the host stand and hugged me.”
More than just a pretty sports schedule
Over time, Jaffee and his team realized they could provide their subscribers with not only great sports programming, but also the benefit of his restaurant experience, connections and insights. By providing valuable content to his customer base, he now helps new and growing restaurants with important tips, best practices, thought-provoking articles and ideas that are specifically relevant to restaurant and bar operations on their blog. A stream of regular content can be found there, but here are a few tips he provided:
Rule #1: Break the Inertia
Jaffee is a fan of all things that make restaurant operations more efficient and less costly to run. Technology, he believes, can help reduce the pain of running restaurants when it is implemented and utilized. “It clearly makes you more responsive, ” he says. “It simplifies your life. People think technology complicates operations and that’s the mistake.”
He went on to explain that too often restaurants suffer from inertia – continuing to do things the way they have always done it, and that’s the cause of most of the problems they have.
“Many operators are so busy, they simply don’t want to pause and see how they could be working smarter,” he says. “What they have is just fine, so they just keep going with it, not realizing the negative impact their lack of action is having.”
Jaffee has a great example. “For years, operators have been approached by people who sell credit card services. It’s one of those things most operators don’t think enough about. They open their restaurant and they go to the bank, and the bank says, ‘Of course we’ll do credit card services for you’ and they charging the restaurant 4-5% per transaction, when they should be able to get more like 2.9% per transaction, maybe a little less if you’re higher volume. I can walk to a restaurant owner and say, ‘I’m going to reduce your credit card cost by probably 25%, maybe more. It’s a big number.’ But the operators won’t even give you the paperwork to do the calculation to give them a bid! They can’t get out of their own way. Even when it’s real dollars sitting there. They stay with what they have because it works just fine and they don’t have to think about it. Inertia.”
What is it that breaks the inertia and gets people’s attention at last? Jaffee believes that it’s fear. Real fear – fear of going out of business when the numbers just don’t add up, for example. Either that, or overwhelming evidence from other restaurant operators or workers telling them over and over that they need to change.
Rule #2: Be Vigilant of Theft
Jaffee’s second piece of advice? “This is really cynical,” he says, “but it’s the truth – everybody is going to try to steal from you. It’s true at every single level, but don’t take it personally. Think about it in these terms: An hourly employee comes in, clocks in, and then goes and sits down to eat something. That’s stealing. A bartender over pours because their friend is at the bar. That’s stealing. A beer guy ends up sending you five cases of something you didn’t want. He’s taking your money. The government is coming at you in 100 ways, at a regulatory and statutory level, making you come up with money. The truth of the matter is that everybody is trying to take from you. You can’t take it personally, but you’ve got to be vigilant.”
He went on to share a story of an employee who attempted to steal lobsters by shoving the live critters into his backpack. It didn’t go well for him.
“He was trying to push the lobster into his backpack and the rubber band holding the claw came off. He got pinched, hard and he’s really lucky he didn’t lose his finger.”
That employee might have learned a lesson the hard way, but Jaffee also had his own lesson. He realized he needed to be on top of all the ways people will, unfortunately, try to take advantage of you and put your business at risk.
Rule #3: Don’t Fear the Wrong Things
Change is happening in the restaurant industry and an increasing pace. Rules about tipping, ACA laws, the expectations of the millennial generation and technology to name just a few. Restaurant owners tend to be fearful of what’s coming or listen to the so-called experts who say the sky is falling.
Jaffee notes the recent discussions surrounding paid time off, what it really means and how it’s going to impact restaurants. From his perspective, it may not be the “disaster” many are saying it’s going to be.
“Restaurants shouldn’t be scared of it. It’s silly to be scared of it. Yes, it might mean a small labor cost increase, but then they’ll have healthier employees, safer employees. And they’ll retain them because if they leave, they don’t get to take the benefit with them. In fact, it’s an opportunity for restaurants to use it as a tool in the War for Talent. There’s nothing wrong with saying, ‘Hey, we offer great hours and paid sick leave.’ If you have to do it, brag about it and use it as a selling tool.”