www.franchisetimes.com The News and Information Source for Franchising April 2011

Finance, anyone?Our coverage tells where the money’s been hiding

Here’s the beefCompanies are still bullish on hamburger concepts

April 2011 39

2011’s class takes flight

congratulations to this year’s legal eagles™

To make this list, attorneys are nominated by their peers and clients, plus meet the criteria of the FT editorial panel. Legal Eagles™ are the attorneys you’ll find speaking at industry events and legal symposiums, winning court cases and writing seamless

contracts and documents. Turn the page to meet our best of the best.

2011 2011

Need a lawyer?Then check our list of the top Legal Eagles

It takes a team to run a company, according to YUM! franchisee

Jim Bodenstedt, and a big man to know he needs one

It takes a team to run a company, according to YUM! franchisee

Jim Bodenstedt, and a big man to know he needs one

It takes a team to run a company, according to YUM! franchisee Jim Bodenstedt, and a

big man to know he needs one

T he move makes sense if you con-sider MUY Brands doesn’t need room for printers, paper stor-

age, file cabinets or fax machines. The company has quadrupled in size since moving into its 7,000-square-foot head-quarters in San Antonio, and yet the space will be scaled down to 4,500. The company has made 11 acquisitions since 2003, according to John Haynie, chief financial officer.

So how do you grow your company while scaling down the home office? Telecommuting, for one thing, but the real reason they can do more with less, is because Bodenstedt is on effi-ciencies like a dog on a bone. Saving money, time, effort and headaches is Jim Bodenstedt’s calling in life.

After looking at how inefficient

paper moved around the support center two years ago, he initiated a paperless office. Employees’ desks now have two or three monitors and no printer. Communication is by email, calendars are managed on computers and rather than fill up file cabinets, PDFs are kept on server folders.

When the occasional errant vendor sends a paper invoice, it’s scanned in and processed electronically. Paychecks are either direct deposit or restaurant employees are given a pay card, similar to a debit card. Not having to over-night paychecks saves around $150,000 per year on overnight shipping fees. Needless to say, there is no mailroom person on staff. “We tried to opt-out of the U.S. mail (delivery service), but you can’t,” Bodenstedt says.

Pay stubs are online, as are most of their training materials and hiring forms. Rather than scheduling training sessions, the online version allows the

“TiVo generation” to access it when they want it. “We do all this so the manag-er’s job is easier,” he says.

A visitor could get the impression little work is being done. There are no piles of paper on desks, no folders over-flowing with invoices. But that couldn’t be further from the truth. Bodenstedt is the first to admit the transition wasn’t easy, but when he starts ticking off the savings it’s afforded him, the accoun-tant-turned-operator smiles broadly. His team, however, has made it happen.

The only downside, one employee said, is they don’t get as much exer-cise because there’s no excuse to get

After completing a deal with his former boss to buy his 31 Pizza Huts, plus purchasing an additional 77 units in Houston from the franchisor—bringing his total number of YUM! units to 226 with eight more under construction—Jim Bodenstedt and his team did what any executives would do with a quickly expanding company: They moved their restaurant support center to smaller quarters.

D

A. Tory Rutledge, director of the call center operations, checks a worker’s screen.

B. Jim Bodenstedt, left, with real estate partner, Norm Jacobson

C. Pizza Hut buffet

D. The team: (l to r) Jim Mooney, Jim Bodenstedt, Grant Stewart, Steve Adkins, Dan Karam, John Haynie, Dawson Bremer.

A

B C

It takes a team to run a company, according to YUM! franchisee Jim Bodenstedt, and a

big man to know he needs one

T he move makes sense if you con-sider MUY Brands doesn’t need room for printers, paper stor-

age, file cabinets or fax machines. The company has quadrupled in size since moving into its 7,000-square-foot head-quarters in San Antonio, and yet the space will be scaled down to 4,500. The company has made 11 acquisitions since 2003, according to John Haynie, chief financial officer.

So how do you grow your company while scaling down the home office? Telecommuting, for one thing, but the real reason they can do more with less, is because Bodenstedt is on effi-ciencies like a dog on a bone. Saving money, time, effort and headaches is Jim Bodenstedt’s calling in life.

After looking at how inefficient

paper moved around the support center two years ago, he initiated a paperless office. Employees’ desks now have two or three monitors and no printer. Communication is by email, calendars are managed on computers and rather than fill up file cabinets, PDFs are kept on server folders.

When the occasional errant vendor sends a paper invoice, it’s scanned in and processed electronically. Paychecks are either direct deposit or restaurant employees are given a pay card, similar to a debit card. Not having to over-night paychecks saves around $150,000 per year on overnight shipping fees. Needless to say, there is no mailroom person on staff. “We tried to opt-out of the U.S. mail (delivery service), but you can’t,” Bodenstedt says.

Pay stubs are online, as are most of their training materials and hiring forms. Rather than scheduling training sessions, the online version allows the

“TiVo generation” to access it when they want it. “We do all this so the manag-er’s job is easier,” he says.

A visitor could get the impression little work is being done. There are no piles of paper on desks, no folders over-flowing with invoices. But that couldn’t be further from the truth. Bodenstedt is the first to admit the transition wasn’t easy, but when he starts ticking off the savings it’s afforded him, the accoun-tant-turned-operator smiles broadly. His team, however, has made it happen.

The only downside, one employee said, is they don’t get as much exer-cise because there’s no excuse to get

After completing a deal with his former boss to buy his 31 Pizza Huts, plus purchasing an additional 77 units in Houston from the franchisor—bringing his total number of YUM! units to 226 with eight more under construction—Jim Bodenstedt and his team did what any executives would do with a quickly expanding company: They moved their restaurant support center to smaller quarters.

D

A. Tory Rutledge, director of the call center operations, checks a worker’s screen.

B. Jim Bodenstedt, left, with real estate partner, Norm Jacobson

C. Pizza Hut buffet

D. The team: (l to r) Jim Mooney, Jim Bodenstedt, Grant Stewart, Steve Adkins, Dan Karam, John Haynie, Dawson Bremer.

A

B C

R e p r i n t e d w i t h t h e p e r m i s s i o n o f F r a n c h i s e T i m e s A p r i l 2 0 1 1 © F r a n c h i s e T i m e s, 2 8 0 8 A n t h o n y L a n e S o u t h , M p l s . , M N 5 5 4 1 8

up and file paperwork or walk over to a coworker’s desk to deliver a memo. But the upside is fewer paper cuts, another employee quips. And once when someone needed a stapler, one couldn’t be found. The little-used tool was relegated to some back shelf.

Many of the employes admitted being paperless has flowed over into their home lives. They now pay their personal bills online and cancelled newspaper subscrip-tions, preferring to read the news on their monitors.

Going paperless “makes a world of sense” to the insurance industry, says Brent Jones of West’s Insurance Agency, who works with franchise companies.

“You have your business on one hard-drive you can fit in a briefcase, and three other back-ups.” And no problem with files going up in flames.

Bodenstedt is the quintessential prob-lem-solver, and he’s surrounded himself with smart people. He’s never content with the first answer given to the team’s questions.

“We always have spirited discussions with Jim, and when I say spirited, I mean spirited,” says Shirram Chokshi, of Auspex Capital, financial advisor for both Bodenstedt and the franchisee company Bodenstedt started with, R&L Foods.

“You need to substantiate it; prove it to him” before he will accept something as a given, Chokshi says. And he sees that attribute as a positive, because Bodenstedt comes to those discussions with an open mind. He listens before he decides.

One of the framed pictures on his office wall is the back of a T-shirt auto-graphed with the date of his first solo airplane flight. When asked if he still flies, he answered, “I’m always thinking of other things. If you can’t ‘be’ in the plane, don’t be in the plane.” Good advice for other multi-taskers out there.

Bodenstedt has definite ideas about how things should work, and he’s not easily swayed.

I learned this first hand on my trip to San Antonio. He insisted the story be about his team, not about him. After all, he thinks enough of his executive team to give them all equity in the company. I agreed, thinking that once there I’d be able to persuade him to let us take a pic-

ture of just him for the cover—and run the team picture inside.

In a good-natured, but firm, tone, Bodenstedt informed me it was the team or nothing. When I teased him that I had thought my charm would prevail, he looked at me from under his eyebrows and rolled his eyes. The team members in the back seat snickered.

“What? You don’t think I’m charming?” I asked in mock surprise. “No, we just know Jim,” one of them replied, as they all laughed.

And if you saw the team picture on the cover, you’ll know who won that battle. (P.S. Future cover story subjects, it only works once. Please don’t even go there.)

Bodenstedt has always been an enter-prising go-getter, and has attracted like-minded people to him. He was born in southern Michigan, but moved to Texas when he was 4. “I tell everyone, I got here as soon as I could,” he says.

He borrowed money to go to college, worked and graduated in 23 months. “I was planning to go to law school, so I needed to do it (college and law school) in five years,” he says of his financial time-line. It didn’t make sense at the time to go further into debt, when what he wanted was to make money and help other people get ahead in life. One of his first jobs was at McDonald’s and he was the youngest person at that time to attend Hamburger U.

Haynie shared a stor y about Bodenstedt’s interview with McDonald’s. He was a 16-year-old kid who showed up for the interview wearing a suit. “He claims it got him 10-cents an hour more,” Haynie says, laughing.

Bodenstedt decided not to investi-gate McDonald’s because he didn’t have enough money to buy one, and couldn’t see as a young man, why anyone would want five of them. “Oops,” he says.

The first step on his current path was when he started working for Richard Breakie of R&L Foods, a franchisee of Taco Bell. Bodenstedt was quickly pro-moted to CFO. He struck an unusual bargain with his boss, asking permission to buy his own Taco Bells and KFCs, and then pay R&L to manage them for him. So in essence, he was managing his own restaurants while receiving a paycheck. It

was a win for him because he didn’t have to take any cash out of his company since he was already receiving a paycheck; and a win for Breakie, who had economies of scale, cash coming in and a dedicated CFO/COO. Today, Bodenstedt’s com-pany manages Breakie’s restaurants.

Covering the teamIronically, while Bodenstedt had the

entire six-man executive team, plus his real estate partner, on a timed interview schedule, the team was as eager to talk about him, as he was to avoid the subject.

“Everyone on the executive team works hard; we’re hands-on,” says Haynie. “But Jim makes it fun.”

Bodenstedt and his wife don’t have their own children, so they look after everyone else’s.

“He’s always thinking about our fami-lies,” Haynie says. “He contributes to the executive team kids’ college funds.”

Bodenstedt and his wife, Cathy, believe education is important. Cathy just finished her college degree—and bought the Cap-Rock Winery near Lubbock. The couple donated $1 million in scholarships to their alma mater, University of Texas at San Antonio, to help fund the start of a football team. It’s not because he’s a foot-ball fan, Bodenstedt admits, but because a strong athletic program ultimately beefs up the arts, business and engineering programs. The gift was the largest in the school’s history.

MUY Brands is known for its gener-osity to the communities it feeds—from Amarillo and New Mexico to El Paso, with Dallas/Ft. Worth, Corpus Christi and San Antonio in between. They sup-port the charities of its parent company YUM, as well as local scholarships, food banks, the Boys and Girls Club and youth sports team. The newsletters on MUY’s website is filled with long lists of organizations that have benefitted from the restaurant company.

Selecting the bestIn true form, Bodenstedt didn’t wait

for his top people to find him. He went after them.

Grant Stewart, chief people officer, joined MUY Brands from corporate two-and-a-half years ago. Stewart was

supporting 6,000 restaurants at the time, but Bodenstedt was able to bring him on board by offering him equity in the business. “I saw him growing and YUM selling off stores,” Stewart says.

In addition to staffing the restaurants, Stewart oversees staffing at the Managed Call Center for the Pizza Hut restaurants. The center is another of the company’s innovations.

Dan Karam, chief information officer, has his hands full, because technology innovation is what keeps MUY Brands a lean, meaningful, running machine. Karam, who has been with the company three years, was friends with Bodenstedt in college. Karam had just gotten his dream job with USAA, when Bodenstedt offered him equity in the company.

“This is going to sound cheesy,” Karam says. “But you hear about that one chance that comes along. (Well) Jim doesn’t know how to fail. This was my one shot and it was a good one to take.”

When he was negotiating with Karam, Bodenstedt sent him a text message for his wife: “Tell Heather everything will be fine.”

“Hands down, Jim is the best negotia-tor, you’ll find,” Karam says. “He hits a point where failure would be there, and he moves to the side and finds another path.”

The newest member to the team is Dawson Bremer, chief legal officer, who had handled MUY Brands and its affil-iates’ real estate, financial and corporate legal work for the past three years. In addition, he’ll also be learning how to lobby.

Rounding out the executive team are longtime members Jim Mooney, vice president of operations for the Pizza Hut and WingStreet stores, and Steve Adkins, vice president of operations for A&W, KFC, Long John Silver’s and Taco Bell. The fact that they know operations like the back of their hands is obvious when you observe them in the stores.

On a side note, when Bodenstedt was asked about any interest in buying the Long John Silver’s chain his franchisor has on the auction block, he smiled, say-ing, “I can’t comment.”

Someone who’s not a partner, but is still an integral part of the business is

Norman Jacobson, a physician by train-ing, who later became a savvy business investor. The two were introduced by Jacobson’s real estate agent. Bodenstedt needed an investor and Jacobson needed a sure investment. “I liked him,” he says. While other investor-types pick a winner based on the horse, “I choose the jockeys,” he says. But he did his due diligence all the same. What he found was transpar-ency and an operator who “is a master at what he does.” Here’s how he explained it: “Bodenstedt knows the business; he has dirt under his nails. He knows what drives people (and how to incentivize them) and proves his point by history and performance.”

And even more important, Jacobson says “I’ve never caught him misstating or overstating.”

The team is generous with its resources—the company planes are available to make travel among the units easier on staff and two vacation homes are open for mangers’ use. Top managers are taken on cruises and to pro sporting events. Food at the restaurants is free for employees.

“We let our mind and heart guide our conscience,” Bodenstedt says. “You look at the food industry and its layoffs. Our employees have no worries about being laid off.”

Perhaps the most innovative idea is the managed call center for MUY’s 160 Pizza Huts. The 225-seat call center frees up the delivery restaurants from sacrificing an employee—who often ends up being the manager—from taking orders instead of managing. The value of the order-tak-ers is that they can up-sell orders— the average ticket price rises $2.50 with the call center employee on the line—and problems can be handled immediately. Equally valuable, no calls are missed or put on hold.

Callers market to businesses in the area during slow times. But they never tweet or offer coupons. When they stopped printing and mailing coupons in October 2008, the company saved a million dollars to the bottom line. “Why would I spend money to produce and deliver a coupon in the hope someone would bring it in to pay me less?” he asks.

Don’t call himMUY Brands doesn’t plan to invest

in businesses outside of YUM! or Texas. They have a few stores in New Mexico, “but I can see them from Texas.”

Bodenstedt also doesn’t plan on get-ting more than six hours of sleep a night.

“You know the worse thing about sleep-ing?” he asks. “It’s six hours away from going on with your next day.” And we’d bet the team feels the same way.

—Nancy Weingartnersavings

Cover Story Cover Story

R e p r i n t e d w i t h t h e p e r m i s s i o n o f F r a n c h i s e T i m e s A p r i l 2 0 1 1 © F r a n c h i s e T i m e s, 2 8 0 8 A n t h o n y L a n e S o u t h , M p l s . , M N 5 5 4 1 8

up and file paperwork or walk over to a coworker’s desk to deliver a memo. But the upside is fewer paper cuts, another employee quips. And once when someone needed a stapler, one couldn’t be found. The little-used tool was relegated to some back shelf.

Many of the employes admitted being paperless has flowed over into their home lives. They now pay their personal bills online and cancelled newspaper subscrip-tions, preferring to read the news on their monitors.

Going paperless “makes a world of sense” to the insurance industry, says Brent Jones of West’s Insurance Agency, who works with franchise companies.

“You have your business on one hard-drive you can fit in a briefcase, and three other back-ups.” And no problem with files going up in flames.

Bodenstedt is the quintessential prob-lem-solver, and he’s surrounded himself with smart people. He’s never content with the first answer given to the team’s questions.

“We always have spirited discussions with Jim, and when I say spirited, I mean spirited,” says Shirram Chokshi, of Auspex Capital, financial advisor for both Bodenstedt and the franchisee company Bodenstedt started with, R&L Foods.

“You need to substantiate it; prove it to him” before he will accept something as a given, Chokshi says. And he sees that attribute as a positive, because Bodenstedt comes to those discussions with an open mind. He listens before he decides.

One of the framed pictures on his office wall is the back of a T-shirt auto-graphed with the date of his first solo airplane flight. When asked if he still flies, he answered, “I’m always thinking of other things. If you can’t ‘be’ in the plane, don’t be in the plane.” Good advice for other multi-taskers out there.

Bodenstedt has definite ideas about how things should work, and he’s not easily swayed.

I learned this first hand on my trip to San Antonio. He insisted the story be about his team, not about him. After all, he thinks enough of his executive team to give them all equity in the company. I agreed, thinking that once there I’d be able to persuade him to let us take a pic-

ture of just him for the cover—and run the team picture inside.

In a good-natured, but firm, tone, Bodenstedt informed me it was the team or nothing. When I teased him that I had thought my charm would prevail, he looked at me from under his eyebrows and rolled his eyes. The team members in the back seat snickered.

“What? You don’t think I’m charming?” I asked in mock surprise. “No, we just know Jim,” one of them replied, as they all laughed.

And if you saw the team picture on the cover, you’ll know who won that battle. (P.S. Future cover story subjects, it only works once. Please don’t even go there.)

Bodenstedt has always been an enter-prising go-getter, and has attracted like-minded people to him. He was born in southern Michigan, but moved to Texas when he was 4. “I tell everyone, I got here as soon as I could,” he says.

He borrowed money to go to college, worked and graduated in 23 months. “I was planning to go to law school, so I needed to do it (college and law school) in five years,” he says of his financial time-line. It didn’t make sense at the time to go further into debt, when what he wanted was to make money and help other people get ahead in life. One of his first jobs was at McDonald’s and he was the youngest person at that time to attend Hamburger U.

Haynie shared a stor y about Bodenstedt’s interview with McDonald’s. He was a 16-year-old kid who showed up for the interview wearing a suit. “He claims it got him 10-cents an hour more,” Haynie says, laughing.

Bodenstedt decided not to investi-gate McDonald’s because he didn’t have enough money to buy one, and couldn’t see as a young man, why anyone would want five of them. “Oops,” he says.

The first step on his current path was when he started working for Richard Breakie of R&L Foods, a franchisee of Taco Bell. Bodenstedt was quickly pro-moted to CFO. He struck an unusual bargain with his boss, asking permission to buy his own Taco Bells and KFCs, and then pay R&L to manage them for him. So in essence, he was managing his own restaurants while receiving a paycheck. It

was a win for him because he didn’t have to take any cash out of his company since he was already receiving a paycheck; and a win for Breakie, who had economies of scale, cash coming in and a dedicated CFO/COO. Today, Bodenstedt’s com-pany manages Breakie’s restaurants.

Covering the teamIronically, while Bodenstedt had the

entire six-man executive team, plus his real estate partner, on a timed interview schedule, the team was as eager to talk about him, as he was to avoid the subject.

“Everyone on the executive team works hard; we’re hands-on,” says Haynie. “But Jim makes it fun.”

Bodenstedt and his wife don’t have their own children, so they look after everyone else’s.

“He’s always thinking about our fami-lies,” Haynie says. “He contributes to the executive team kids’ college funds.”

Bodenstedt and his wife, Cathy, believe education is important. Cathy just finished her college degree—and bought the Cap-Rock Winery near Lubbock. The couple donated $1 million in scholarships to their alma mater, University of Texas at San Antonio, to help fund the start of a football team. It’s not because he’s a foot-ball fan, Bodenstedt admits, but because a strong athletic program ultimately beefs up the arts, business and engineering programs. The gift was the largest in the school’s history.

MUY Brands is known for its gener-osity to the communities it feeds—from Amarillo and New Mexico to El Paso, with Dallas/Ft. Worth, Corpus Christi and San Antonio in between. They sup-port the charities of its parent company YUM, as well as local scholarships, food banks, the Boys and Girls Club and youth sports team. The newsletters on MUY’s website is filled with long lists of organizations that have benefitted from the restaurant company.

Selecting the bestIn true form, Bodenstedt didn’t wait

for his top people to find him. He went after them.

Grant Stewart, chief people officer, joined MUY Brands from corporate two-and-a-half years ago. Stewart was

supporting 6,000 restaurants at the time, but Bodenstedt was able to bring him on board by offering him equity in the business. “I saw him growing and YUM selling off stores,” Stewart says.

In addition to staffing the restaurants, Stewart oversees staffing at the Managed Call Center for the Pizza Hut restaurants. The center is another of the company’s innovations.

Dan Karam, chief information officer, has his hands full, because technology innovation is what keeps MUY Brands a lean, meaningful, running machine. Karam, who has been with the company three years, was friends with Bodenstedt in college. Karam had just gotten his dream job with USAA, when Bodenstedt offered him equity in the company.

“This is going to sound cheesy,” Karam says. “But you hear about that one chance that comes along. (Well) Jim doesn’t know how to fail. This was my one shot and it was a good one to take.”

When he was negotiating with Karam, Bodenstedt sent him a text message for his wife: “Tell Heather everything will be fine.”

“Hands down, Jim is the best negotia-tor, you’ll find,” Karam says. “He hits a point where failure would be there, and he moves to the side and finds another path.”

The newest member to the team is Dawson Bremer, chief legal officer, who had handled MUY Brands and its affil-iates’ real estate, financial and corporate legal work for the past three years. In addition, he’ll also be learning how to lobby.

Rounding out the executive team are longtime members Jim Mooney, vice president of operations for the Pizza Hut and WingStreet stores, and Steve Adkins, vice president of operations for A&W, KFC, Long John Silver’s and Taco Bell. The fact that they know operations like the back of their hands is obvious when you observe them in the stores.

On a side note, when Bodenstedt was asked about any interest in buying the Long John Silver’s chain his franchisor has on the auction block, he smiled, say-ing, “I can’t comment.”

Someone who’s not a partner, but is still an integral part of the business is

Norman Jacobson, a physician by train-ing, who later became a savvy business investor. The two were introduced by Jacobson’s real estate agent. Bodenstedt needed an investor and Jacobson needed a sure investment. “I liked him,” he says. While other investor-types pick a winner based on the horse, “I choose the jockeys,” he says. But he did his due diligence all the same. What he found was transpar-ency and an operator who “is a master at what he does.” Here’s how he explained it: “Bodenstedt knows the business; he has dirt under his nails. He knows what drives people (and how to incentivize them) and proves his point by history and performance.”

And even more important, Jacobson says “I’ve never caught him misstating or overstating.”

The team is generous with its resources—the company planes are available to make travel among the units easier on staff and two vacation homes are open for mangers’ use. Top managers are taken on cruises and to pro sporting events. Food at the restaurants is free for employees.

“We let our mind and heart guide our conscience,” Bodenstedt says. “You look at the food industry and its layoffs. Our employees have no worries about being laid off.”

Perhaps the most innovative idea is the managed call center for MUY’s 160 Pizza Huts. The 225-seat call center frees up the delivery restaurants from sacrificing an employee—who often ends up being the manager—from taking orders instead of managing. The value of the order-tak-ers is that they can up-sell orders— the average ticket price rises $2.50 with the call center employee on the line—and problems can be handled immediately. Equally valuable, no calls are missed or put on hold.

Callers market to businesses in the area during slow times. But they never tweet or offer coupons. When they stopped printing and mailing coupons in October 2008, the company saved a million dollars to the bottom line. “Why would I spend money to produce and deliver a coupon in the hope someone would bring it in to pay me less?” he asks.

Don’t call himMUY Brands doesn’t plan to invest

in businesses outside of YUM! or Texas. They have a few stores in New Mexico, “but I can see them from Texas.”

Bodenstedt also doesn’t plan on get-ting more than six hours of sleep a night.

“You know the worse thing about sleep-ing?” he asks. “It’s six hours away from going on with your next day.” And we’d bet the team feels the same way.

—Nancy Weingartnersavings

Cover Story Cover Story