¡Muy Bueno! It's full speed ahead for this 5-brand Mexican food franchisor
Name: Pete Pascuzzi
Company: MRI Heritage Brands
Units: 40 total for Casa Olé, Monterey’s Little Mexico, Überrito Fresh Mex, Tortuga Mexican Kitchen, Crazy Jose’s
Years in franchising: 30
Years in current position: 2
Pete Pascuzzi has spent more than three decades in the restaurant industry, working with brands including Carl’s Jr., Hardee’s, Church’s, Long John Silver’s, and Taco Bell. He had spent 3 years as president of 300-plus–unit Falcon Holdings Management when opportunity came knocking in the spring of 2020. That’s when Houston-based MRI Heritage Brands approached Pascuzzi to become CEO.
MRI (Mexican Restaurants Inc.) is a five-brand franchisor specializing in Mexican food. Its brands are Casa Olé, Monterey’s Little Mexico, Überrito Fresh Mex, Tortuga Mexican Kitchen, and Crazy Jose’s. The company’s more than 40 locations are spread across Texas, Oklahoma, Louisiana, and Arizona.
Despite the challenges brought on by Covid-19, Pascuzzi has charged ahead with the company’s growth initiatives, managing the operations and strategy of their five brands. He’s drawn on his knack for transforming restaurant operations not only to increase sales and profitability, but also market share and employee retention.
“I have a number of business goals I am focused on,” he says. “These include increasing market share, elevating all of our brands to a prominent position in the casual and fast-casual segments, continuing to focus on franchise expansion efforts, and ensuring we go above and beyond for our loyal customers while gaining new customers.”
At 68, Pascuzzi shows no signs of slowing down, and is clearly headed in the right direction: MRI’s comp sales are up more than 30% year-to-date, and he says there’s even more to come next year. “We will continue to offer new menu items and limited-time offers that will bring guests back to our restaurants again and again.”
What is your role as CEO? To create the vision and road map for our restaurants operating under the MRI Heritage Brands umbrella, my responsibility is to establish and foster our culture, built on a foundation of unwavering ethics and strong values. Additionally, it’s my responsibility to be a good listener. We’re a growing and passionate restaurant community, and as a leader of our community I must make good choices relative to actions we take, how we act, and the timing of that action.
How has Covid-19 affected the way you have led your brand? Our perseverance over the last couple of years is a direct testament to the passion and dedication our teams exemplify each day. As I look back on Covid, I am so proud of how our franchisees and staff thrived and came together despite the incredible challenges and headwinds we faced. The innovation and resiliency we showed, while continuing to remain relevant among our guests and our communities, is exactly why we were seeing our current success. Authentic Mexican food at an affordable price remains a feel-good and winning combination, and that is why our sales have continued to climb.
Describe your leadership style: It’s an approach that champions learning while also being goal-oriented. It’s about setting an example for team members and franchisees—nurturing their skills and developing new ones, while continuing to focus on long-term targets while planning out short-term steps. Rather than getting distracted by passing trends or competitor achievements, my type of leadership style concentrates on the bigger picture and helping to find ways to reach objectives.
What has inspired your leadership style? First, it was my time as a franchisee in the Dallas area with Burger King in 2004. I learned very quickly that I if I didn't have happy employees, they would leave me to go somewhere else. I had to build camaraderie, culture, and an environment where my best employees would refer their friends to the company. I’ve also had some great mentors along the way including Aslam Khan from Falcon Holdings Management. He taught me to be a leader, a great operator, and really explained the sacrifices I would have to make.
What is your biggest leadership challenge? One of my biggest leadership challenges is maintaining an adaptable franchise model. With the onset of Covid, we realized there’s opportunity in change. Customers still wanted our authentic, made-from-scratch Mexican food and were willing to adapt to get it. That’s a testament to our brands, our loyal customer base, and the hard work of our entire team as we pivoted to online and mobile, allowing for quick delivery, pickup, and safe in-store ordering. Even at the height of the virus, we were still introducing new products.
How do you transmit your culture from your office to front-line employees? Front-line staff are one of the absolutely most important elements of the customer experience. To foster and grow our culture, we effectively communicate a clear vision that connects restaurant staff to the bigger picture. We also empower front-line staff to make important guest service and business decisions. Not only is this better for our guests, it also makes employees more valued and more important to overall success.
How can a CEO help their CMO develop and grow? There must be strategic alignment. Not only is alignment on your organization’s higher-level purpose, but on the purpose of marketing as well. Is it to build a powerful brand? Establish and develop growth engines? Own the end-to-end guest experience? Whatever it is, alignment relative to marketing’s role in the organization is essential for shared success.
Where is the best place to prepare for leadership: an MBA school or OTJ? It’s hard to replace on-the-job training as an element critical to future success. But education certainly is also important as the fundamentals of business are an essential part of future success. I’m not sure it’s possible to select one over another.
Are tough decisions best taken by one person? How do you make tough decisions? Indecision wastes time (days, weeks, months, even years). However, making good decisions doesn’t have to mean deciding slowly. Solid decision-making relies on three fundamental elements: 1) book time to think, 2) define the decision, 3) think through your options. Once you’ve thought it through, talked it through, and asked for perspective, it’s time to make the final decision.
Do you want to be liked or respected? Being likable doesn’t necessarily mean you will be liked. Respect is an absolute necessity in business.
Advice to CEO wannabes: Surround yourself with a great team. It’s impossible to do everything, so having a strong team you can rely on will allow you to make the most informed and best decisions possible.
Describe your management style: I have more of a collaborative management style. Ultimately, the final decision lies with me, but I believe in engagement with people at all levels of the company to better understand where we are succeeding and where we have opportunities to grow.
What does your management team look like? For a management team to work well together there must be a diversity of skills and strengths that complement each other. When a team is built upon a foundation of trust, it is much easier to collaborate, disagree, resolve conflict, brainstorm, and evolve.
How does your management team help you lead? They help implement our strategic direction and keep me informed relative to initiatives and deadlines within their respective departments. They also think differently than I do, which helps me make the most informed decisions possible.
What makes you say, “Yes, now that’s why I do what I do!”? Seeing how our team came together at the onset of Covid and how we were able to quickly pivot to online and delivery while still being able to communicate to our customers that we were open and how they could use us was simultaneously one of the most challenging and rewarding experiences of my franchising career.
What trends are you seeing with consumer spending habits in your stores? Understanding trends in consumer behavior before they become apparent can give a business an unprecedented advantage over its competitors. Some of the major trends we’re seeing with consumer spending habits are an increased demand for transparency; accelerated online buying; a boosted need for social experiences; and an increased focus on menu authenticity.
How is the economy driving consumer behavior in your system? Consumers are still in the process of rebalancing and reestablishing new behaviors and routines, and the foodservice industry continues navigating how to respond accordingly.
What are you expecting from your market in the next 12 months? Internet usage has increasingly grown over the years, but the pandemic forced true reliance, moving nearly all daily activities online. Nineteen million Americans lack fixed access to the Internet, with one in four of them in rural areas. These people may miss out on some opportunities afforded to those with a reliable connection. Digital-only and digital-first solutions are here to stay, but don’t alienate key consumer groups.
Are your franchisees bullish or bearish about growth and adding units? Most continue to be bullish about multi-unit growth as we expand into our target growth markets of Central Texas, South Carolina, Florida, and Georgia, among others.
Are commodity/supplies costs any cause for concern in your system? The underlying reasons behind the commodity price hikes are varied, but mostly stem from supply issues resulting from the pandemic.
How are political/global issues affecting the market and your brand? MRI Heritage Brands is a family. We are here to foster a supportive and inclusive community among our franchisees, staff, guests, and the people we serve. While our restaurants have grown and we have plans for additional expansion, some things have remained constant. Fresh and quality ingredients are the foundation of a great meal. This is the model for all our kitchens and the magic that happens in them.
What time do you like to be at your desk? 7 a.m., so I can be in one of our restaurants for lunch.
Exercise in the morning? Sometimes.
Wine with lunch? No.
Do you socialize with your team after work or outside the office? I either see my team or talk to them almost every day, but we do try to have a lunch or dinner together every month so we can all connect as a group and share ideas.
Last two books read: Mind Your Own Business by Jim Sullivan, and Setting the Table by Danny Meyer.
What technology do you take on the road? iPhone, iPad, Bluetooth headset, portable battery pack.
How do you relax/balance life and work? I love what I do, so I view my work as an extension of my life.
Favorite vacation destination: Any Caribbean beach.
Favorite occasions to send employees notes: I prefer to pick up the phone and call them—every chance I can–for professional and personal accomplishments, or if they are dealing with a personal/family crisis.
Favorite company product/service: Überrito street tacos.
What are your long-term goals for the company? We still build our businesses around old traditions, but update them to take advantage of new techniques and new technologies. The growth of our restaurant groups interprets a mash-up of styles and techniques designed to embrace the idea of variety with a passion without sacrificing authenticity. Casa Olé, Monterey’s Little Mexico, Überrito Fresh Mex, Tortuga Mexican Kitchen, and Crazy Jose’s are poised for growth with several new locations set to open throughout the next year across the country.
How has the economy changed your goals for your company? We want to meet our guests where they are, and right now that is through digital sales. At the onset of the pandemic, the message was, “We are open and here is how you can use us.” Post-pandemic, the use of innovative technology to reach guests will be integral to our strategy. I also anticipate much more community outreach from our franchisees.
Where can capital be found these days? Fortunately, we have relationships with several third-party lenders that remain confident in our brands and our franchisees.
How do you measure success? Success is—and will always be—measured by a few key metrics, such as unit-level economics and the profitability of our franchisees, as well as guest satisfaction and brand awareness.
What has been your greatest success? Helping dozens and dozens of entrepreneurs get into business to achieve their professional and personal goals. Contributing to the American Dream of small-business ownership is one of the most rewarding things I’ve been able to do in my career.
Any regrets? My successes and failures have defined who I am. It’s all part of the journey and I would not have changed a thing.
What can we expect from your company in the next 12 to 18 months? Old attitudes about Mexican food are fading. We will never let that desire for a certain kind of faithfulness obscure the work being done by our modern franchisees who want to honor tradition, but also run profitable businesses. Our food and our restaurants are not here to simplify a complex Mexican culinary story or fabricate a history we can’t hold up. We’re here to knit together a new story that depends less on old stereotypes and antiquated business models and more on a new golden era of made-from-scratch Mexican cooking that showcases restaurant profitability and efficient operations.
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