What Does Morfogen Stratis Have to Say About Operating a Restaurant and Living Through the COVID-19 Pandemic?
Running a restaurant isn’t simple at all, especially in these pandemic times. With all the challenges and hardship the owners face, many establishments don’t make it. However, Morfogen Stratis, the owner of Brooklyn Dumpling Shop isn’t one of them.
Thanks to his motivation and will to succeed, he managed to keep his business alive. “Growing up in a traditional Greek household operating diners, restaurants, and catering facilities was a dream come true”, he says. His devotion to family and tradition as well as his hospitality were among the main reasons why he kept going.
Another significant detail is that he was focused on technology and tried new things like the Automat. He speaks of the hardships in the 70s to obtain funding and gain enough money to feed the family and at the same time invest in the business. But then, as time went on, more and more opportunities opened, and he grabbed them, building his image. Starting from artificial intelligence to franchising, he tried a lot of things. And most of them were fruitful.
So, read more about his road to success and his advice for all aspiring and current entrepreneurs here in the whole interview.
Interviewer: Stratis Morfogen has joined me today. He is the founder of Brooklyn Dumpling Shop, which has a fascinating backstory. It’s been gaining a lot of attention online and in the news. I’m delighted to have him on the show today. Why don’t you say hello and tell us a little about yourself, Stratis?
Morfogen Stratis: Thank you so much for having me. I’m the third generation of restaurateurs in my family. In 1910, my grandpa was most likely the first Greek restaurateur in New York. So this is the third generation… Growing up in a traditional Greek household operating diners, restaurants, and catering facilities was a dream come true. To cut a long tale short, I quit my family company when I was 20 years old, which was painful. In my 33-year career, I’ve also opened a few well-known establishments. Gotham Diner, Chiado, Philippe Chow, and others. At the moment, it’s Brooklyn Chop House. Before my children were born, I also owned a couple nightclubs. I soon left that business when my children were born.
As a result, one might say that hospitality is embedded in my spirit. I eat, sleep, and breathe it. And, for the past 15 years, Philippe Chow and Brooklyn Chop House have been synonymous with me. It was there that I first fell in love with Chinese cuisine. Well, I thought we might bring that old-fashioned Greek friendliness to the eateries where I ate the most. That’s when Philippe was born. Mr. Chow’s chef was Philippe Chow. The visitor experience was not very memorable. I escorted the chef out of the area. I offered him the opportunity to live the American dream. Thankfully, I kept every promise I made. He was given a wonderful existence. He had earned it. Then, in 2014, we parted ways.
With my non-compete, I took a few years off. Then there was Philippe’s customers Robert Cummings and Dave Thomas, as well as myself. I’ve always wanted to open my own chophouse. Chopstick-chopsteak or dim sum and chops were the specialties at my chop restaurant. Because every time I went to a fantastic steakhouse, I’d be eating a porterhouse by myself like a slob, while my wife would be the… She’d be having creamed spinach, baked potato, and fish with a bit of parsley because she doesn’t eat meat. And I was thinking to myself, “Oh my goodness! I’m having a great time, and everything she’s eating, I think we could do better at home.”
That’s when the concept for LSD occurred to me. And I’m not referring to the medicine. I’m talking about a 3-pound dry-aged Pat LaFrieda porterhouse steak with salt and pepper, ginger, garlic, and lobster. Married to a 7-pound roasted Peking duck that has never been fried. Lobster, steak, and duck are the three options. To me, this was the pinnacle of surf and turf. That was the seed of the idea for Brooklyn Chop House. It’s a fusion of Chinese and American steakhouse cuisine. As a result, the co-stars, such as lobster, fish, and appetizers, are equally as wonderful as the main event. The porterhouse steak or the dry-aged meats are the main attractions. And we were able to do so with great success. Every sales per square foot record is being broken. The price per foot might reach $3,000 or more. And what occurred at that point, when we were putting out the menu and we got to the appetizers, I said, “I’m not in the mood for a burger! I’m thinking about making a bacon cheeseburger dumpling!” “What?” they exclaim. “I’m not interested in making French onion soup or lobster bisque. I’d like to make lobster bisque or dumplings with French onion soup.” And I was thinking to myself, “Really?” Because the main fear is that we’ll mislead people, I offer a lot of thanks to my partners and chef.
I also stated, “No way! Because we are developing our own name, people will pick it up quickly.” Never bring these goods to a steakhouse in the United States. The Palm was made in Italy. They basically combine Italian and steakhouse cuisine. So we’re combining Beijing cuisine with steakhouse fare, and the results speak for themselves. It was a huge success, and the dumplings were the cherry on top. Pastrami dumplings, bacon cheeseburger dumplings, lamb gyro dumplings, Philly cheesesteak dumplings, and the impossible vegan plant-based dumpling are just a few of the options. It goes on and on. The rhubarb dumpling is a delicacy. We used bok cabbage instead of sauerkraut with the swiss cheese and corned meat. So it was a great success, and the logical next step was “Let’s think about opening a one-and-a-half-pound sandwich store.”
So that’s how I prefer to start my partner meetings. And they say things like, “What are you talking about? A sandwich weighing one and a half pounds? Everyone is going large, so why do we want to open a sandwich shop?” I said, “No, it’s not true. To me, a one-and-a-half-pound lunch is a dumpling.” Carbohydrates are sandwiched between protein, fish, or vegetables. It’s really straightforward. It’s a tiny sandwich, but pigs in a blanket has been a mainstay of the business for 50 or 60 years. What’s more, you know what? Why can’t two subcategories be reimagined? Why can’t the dumpling be reimagined? Why can’t we reinvent the sandwich and combine them to create our own lane? As a result, in 2019, we began authoring Brooklyn Dumpling Shop. I wanted to know how we might do better when I started looking into why so many fast-food establishments had closed. And then I started looking at Horn & Hardart. They invented the Automat in 1895. I also stated, “Okay, so The Automat was a monster in the 1920s, 1930s, 1940s, 1950s, and 1960s. And by the 1970s, it had all but vanished. Because in the 1970s, technology failed The Automat.”
There were no dollar bill receivers to be found. Credit card processors were not available. To feed a family of four, you had to wait in line to acquire $10 in quarters and then wait in line to deposit the quarters in the machine. In the 1970s, 40 quarters were required. Inflation had risen dramatically in the 1970s. People may choose from McDonald’s, KFC, and Pizza Hut. As a result, The Automat soon went out of popularity. As a result, Burger King purchased Horn & Hardart’s final 12 leases. And such was The Automat’s demise. “Wow, I believe that’s the most cost-effective efficient way to deliver a product,” The Automat said to me.
Now there are self-driving vehicles. It’s time to bring back The Automat and give customers the ability to manage it using their smartphones. And that was the end of it. It was something I did with my Panasonic colleagues. I told them what I wanted and how I wanted the visitor experience to be. I’m neither an engineer nor a programmer, and I’m not really… I understand basic technology, but my goal was for people to be able to operate it with their phone. Allow them to use their phone to open The Automat by flashing a bar code that will send a text message or email to the guest. Allow the user to control the entire experience from their phone. Allow them to enter and exit the restaurant in less than 30 seconds. For a successful business, you don’t need the usual 4 to 6 minutes that fast food permits. If you employ our technology, we could get you out in 30 seconds. Now, if you come to the store right now, you’ll see 20, 30, maybe 40 individuals placing orders. And because we don’t prepare anything, they’ll wait up to 6 to 8 minutes.
Everything is prepared fresh to order. We don’t have a slide like many fast-food restaurants have, where the product sits for 15, 20 minutes. Everything is made to order. However, by focusing on technology, we may be able to maintain the product’s integrity. “Hey, 30 minutes before, go online and place your order on our website, and we’ll still be able to cook to order and have everything ready in The Automat in a 150-degree or 35-degree locker for cold things,” the customer is told. Waiting for you, freshly prepared to order, and ready to eat in 30 seconds. That was the entire plan. This was prior to the implementation of COVID. This was in December of 2019. I didn’t do it for the sake of safety. I did it for efficiency and economics, and I’m turning the tables on the consumer and giving them complete power.
Please accept my apologies for the lengthy response. But that’s the only way I’m going to be able to establish the tone and stage here.
That’s not a problem. It has solved some of my original questions, but it leaves me with plenty to investigate further. So what’s amazing about innovation is that it appears to be really well done when you look back. It appears to be self-evident. Of certainly, this is an excellent suggestion. Why hadn’t we done it before now? However, when you’re ahead of the curve, when you’re truly inventing, innovation is inherently unsettling. It’s dangerous, and you’re the one in charge. However, you must enlist the help of others. How did you start making your case? Did you encounter any roadblocks in getting people on board, apart than having a great personality and a lot of zeal?
There’s an ancient adage that goes something like this. If you watch any documentary on innovation, from Ray Kroc to the McDonald brothers to the Atari people when they were building General Dynamics, you’ll see how important it is to be creative. The first person to break through the wall will suffer a bleeding nose.
It’s interesting, when my book, “Damn Good Dumplings,” came out last December, I received critical praise from some of the world’s finest chefs – Daniel Boulud, Éric Ripert, Rachael Ray, Rocco DiSpirito, Todd English, and on and on. “Do you mean to tell me someone never cooked a pastrami dumpling?” they all remarked after reading the book. “No,” I said. And it came naturally to me since, as I already stated, I come from a Greek restaurant background. I’ve also been a Chinese restaurant owner for 15 years. As a result, pastrami or Reuben dumplings are obtained in this manner. To me, it’s essentially… I remember seeing a pastrami sandwich that huge when I was growing up in the diner industry. I have a look at it. I had no desire to bite it, but every time I saw a burger, I would think about it. Because it was not scary to me as a teenager or a kid, I would devour it in a matter of seconds.
And, oddly enough, I have three kids to whom I’ve introduced a variety of new things, ranging from fish to veggies, in the shape of dumplings. I’d cook the dumplings myself at home. I’d also add fish to it. I’d pan fry it in soybean oil until it was a touch crunchy, and the kids would suddenly start eating fish. So it was intriguing to me how the dumpling needed to re-emerge and be reinvented. Because the same thing happens over and over again. Those dumpling shops are my favorite. However, how much pork, vegetables, and crab can you consume?
Right. Well, I think what’s wonderful about the dumpling is your obviously Asian approach to it, as you’ve stated. Dumplings, on the other hand, are prevalent in all civilizations and across Europe. Of course, ravioli is a type of dumpling.
Yes, in my group of friends, I’m recognized for making excellent pierogi. My grandma is Slovak, so I used her recipe, which calls for Colby cheese and mashed potatoes. But, of course, I have no plans to start a restaurant now that I’ve enlarged it. As a result, it remains in my circle of pals. It is, nevertheless, a great method for providing a variety of tastes. As a result, I’m going to urge you to speak on behalf of all Greeks everywhere. Why is the diner concept so appealing to Greek immigrants in the United States?
Because we never looked at the clock. “Why do we have the diner open 24 hours?” that generation, including my father, used to ask. “Well, I’m open 14 days a week, not seven,” I said. And, in essence, it was their strategy. Because one thing that their generation was not scared of was hard labor. My father, for example, had no qualms with working 18 hours a day. “Twelve hours is a half-day,” he would add. And it was from this mindset that they arose. And not everyone is capable of running a 24-hour business. Especially if it’s something that takes a lot of time. And that is the culture that my family instilled in me. My mother would be the cashier. In the basement, my father would be counting lemons to make sure there are nine-elevens in a box. That was their upbringing, and they were extremely cost conscious about every lemon and every cent imaginable. “I can tell you how you’re operating your business by flipping your rubbish upside down,” my father used to remark. Let’s take a look at what’s in your trash. I’ll also tell you how to operate your eatery. Look for waste and how inefficient your process is.”
That’s how I was raised, after all. What’s more, you know what? I wouldn’t trade that for anything because it’s how these bunch of immigrants developed an entire lane where Cheesecake Factory tried to rip it off and ended up where they are now. They’ve declared bankruptcy.
The New York restaurant was practically taken over by cheesecakes. [Crosstalk] improves, but they’re now insolvent, and the diners keep rolling.
Yes. It’s interesting since after working as a paperboy, my first job was at a Greek diner. And I don’t believe this is something you’re interested in…
Where were you in the city?
York, Pennsylvania, a tiny town.
Yes. So that’s Central Pennsylvania. While I was there, I learnt a lot. When you say efficient, I can’t tell you how much I understand what you’re talking about. So, while I was bussing, I recall having to bring all the ramekins of leftover butter back to the back kitchen, where they would scoop it out, melt it down, and reuse it. Now…
And put it to good use with the lobster.No. Today is not one of those days. However, it was really amusing at the time. So you come from a family that instills a strong work ethic and the willingness to experiment with other cuisines. Because I believe it’s one thing that Greek diners are interested in… It’s a no-holds-barred situation. Greek chefs, on the other hand, are cooks who work in the kitchen. They’re the final generation of short-order cooks, if we can call them that. Those people can cook scrambled eggs one minute and then…
Make a salad, a sandwich, and a steak as a strategy.
Oh, and prepare a steak. Also, prepare a lobster feast. This type of thing is insane. So you take this and ultimately you end up with something like this… I despise the term “fusion.” It’s become a bit of an “F” word these days. However, combining this classic steakhouse with Asian influences leads to the separation of dumplings into their own category. So, what did you do, is my question… You said what you observed in The Automat, but where did you come up with new ideas? What was The Automat before it became what it is now? Because, for those who don’t know, Automats were generally coin-operated, and when you walked in, there would be a wall of cubbyholes fully stocked with food.
Great. That’s a fantastic question. But that’s the question I’m always pondering… I attempt to get that question out of the person I’m speaking with in any interview I’m doing. That’s because it’s the key. Many attempts to resurrect The Automat were unsuccessful. They would get completely automated due to two causes. What’s more, you wouldn’t be able to see what’s going on behind it. And, especially today, people are uneasy with this. They don’t feel safe stepping into a metal wall and not knowing what’s behind it. The second aspect, as you mentioned, is that people imagine it to be like a candy machine, where you go to locker 7 for pastrami dumplings and locker 3 for bacon cheeseburger dumplings. That is not the case. As we previously said, our goods are still prepared to order. The Automat, on the other hand, is to me half of the store automat, half of the store is a glass kitchen with a dumpling machine making dumplings right in front of your eyes.
As a result, it resembles a dumpling bakery. That’s incredibly intimate, while The Automat, on the other hand, is quite impersonal. As a result, when you combine the two, it truly works. In the previous 20 years, there have been a few of reincarnations of The Automat that haven’t gone well since the entire wall has become a metal box, which doesn’t function. You’ll need half a metal box and half a piece of kitchen glass. It will not function until you have it. People have this preconception that, “Oh, I’m going to a machine. I’m practically purchasing food as if it were a candy bar.” And that isn’t how it works. Cashiers and logistics staff are essentially replaced by the Automat. That is exactly what it does. It means fewer hands, better efficiency, and a smaller footprint for back-of-house execution, from the cook to the prep. Sorry, all three processes are from the chef to the packager to the expo. And that’s how we get the goods out at a reasonable price. There is very little room for human mistake.
That’s fantastic. You get the theater, which is great since who doesn’t enjoy seeing food being prepared? It just piques our interest as humans. However, it is also evidence positive of the product’s freshness.
That’s right.Years ago, we did some work for Vigor for a “Dim sum restaurant” that wasn’t actually serving dim sum. It was only the dumplings that were the problem. They also possessed a machine. However, they recounted their narrative in such a way that, contrary to our judgment and advice, they claimed that they were home-made. And when you say that, you may imagine folks in the back creating dumplings by hand when, in reality, they had a machine at a factory do it for them. Naturally, their secret was blown. The BS meters went off, and the establishment ultimately closed. When you combine it with when individuals are available, you have a recipe for disaster.
Well, they should have owned that. So, let me explain what’s going on with us, since what you just said is quite true. It’s just that we only have one narrative to tell. That’s a business tale. However, we were the first restaurant in hospitality history to sell 140 franchises before building our first location. And allow me to explain how this will work. So I’m not permitted to sell dumplings over state lines using my dumpling machines. The FDA is prohibited from doing so. So, we’ve partnered up with two co-packers, and we now have a Walmart account. So, Walmart, we’re not going to be able to make 50 million dumplings. However, our co-packer, who has 400,000 square feet of space and is FDA and HACCP certified, is unable to assist us. We do, however, have full creative and culinary authority. We are the ones who make the recipes. Before it gets into production, we really execute every component of that dumpling.
So, I’m not sure why they wouldn’t own it since I will. However, not to the same extent. But, in order for me to service 140 franchisees, I’ll own it. I’m going to need a co-packer. The area is 400,000 square feet.
Jack, Paul, and Peter are the chefs. Every element of every component is under the supervision of my Director of Operations, Culinary Director, and Chef. Then, after we’ve given the go-ahead, it’ll be turned into a major production. It’s important to remember that a dumpling can’t be cooked right away. It must be glass frozen and crystallized-free. It must be frozen before being placed in a steamer. What’s nice about this is that we’re not compromising the product’s integrity in the sake of scalability. As a result, I’m shocked they didn’t already possess it. I would have made a few changes. They should, however, have taken ownership of it. “Yes, we hired a co-packer,” he said. Our items are within our control. We’re ready to go. R&D is helping us create these goods. After that, these items will be delivered to Cisco. Cisco will provide to our franchisees as well.
Stratis: And that, my friends, is the model. “Wow, they’re utilizing third-party dumplings,” someone may comment. No. Yes, a third-party co-packer is involved. But I can’t legally sell my items to you in the same manner that a McDonald’s could produce burgers in one of their stores and transport them throughout the United States when they first opened. It’s against the law. You can’t go interstate unless you’re USDA-certified and have a HACCP-approved facilities. And the bare requirement is around 20,000 square feet.
So we’ll have to go to a co-packer. We have complete command. However, we won’t be able to service 140 shops in the next 30 months from our dumpling lab, which is just behind me. So I’m shocked they didn’t take ownership of it because they were on the right track. However, I do not believe they adequately described it.
Yes. That’s exactly what we were implying. Is it, and if so, why is it hidden? Because if you hide anything, someone will find out. Someone is going to disclose it, and you’ll be exposed as a liar.
I’m referring to entry-level employees. Take a look at what’s happening with Subway and Taco Bell. Every one of these kids has a phone, and they all take a picture of this. “Look at the Subway offering for tuna, look at the Subway providing for chicken, look at the Subway serving for bread,” he says.
There’s nothing wrong with that in my field. I’ll explain why. Because the dumplings must be flash frozen before steaming. As a result, we’re not going to change it. “Oh, the stuff comes fresh,” we’re not attempting to convey. It’s brand new. However, once we slice it up and stuff it into a dumpling, we blast freeze it. Because it won’t remain in a steamer if it isn’t frozen. And every product we make, whether it’s for the fryer or the flat griddle, must spend 3 minutes in the steamer to allow the dough to cook. If you put the dough in without freezing it first, it will break apart.
Right. And one of the things we’d say is that, one, people will find out. Second, why hide anything if you don’t have anything to hide? Finally, it enables you to convey that tale. And when individuals are knowledgeable, they like sharing their knowledge with others. As a result, information is quite valuable in this respect.
I’m going to tell you something that will most likely end up in business books someday. Go to Brooklyn Dumpling Shop’s Yelp page. Matt was the most recent person to do it.
Take a look at this. So, about a week ago, Matt walked past Brooklyn Dumpling Shop. And keep in mind that I’m collecting samples from all of the co-packers. As a result, co-packers are giving me samples of their current product so that I may try it. And then three things occur. One is that if we don’t like the workmanship, we discard it. The second reason is that we like the artistry and the quality of the product “Hello there! We actually placed two of them on the menu.” These are our co-packers, after all. They’re doing everything by hand, which is exactly what we want them to do. The final point is that while we admire their craftsmanship, we dislike the product. We’ll do business with them, nevertheless, since we enjoy their work. We can collaborate with them after they’ve paired up with our chefs.
As he goes past, he notices four boxes of dumplings from a third party, each containing pig potstickers. He snaps a photo and walks away “Take a look at this. This business is a sham. They buy dumplings that you could easily get from Amazon and offer them as fresh. As though it were created right here in the store.” And I’m thinking to myself, “Wow, what a talent this guy has… I appreciate his viewpoint, but he’s full of nonsense.” Sorry, but I had to use that expletive; please remove it. “You know, Matt, maybe there’s an accident here before you go shooting your mouth off because I answer yelpers really unorthodoxly,” I remarked as I turned around.
“If we’re going to get set, we’re going to Yelp you,” she remarked to a group of six at Brooklyn Chop House who arrived an hour late. I received four one-star ratings the next day. As I previously stated, “Let’s take a step back for a moment. To make amends, I’d want to give you all dinner.” They say things like, “Oh my goodness! The night before, you acted really bad.” “No,” I responded, “let’s start over.” I scheduled a Red Lobster reservation in Times Square. “I’m the one who has to pay for it. I don’t want you to come back to my restaurant, so go there. Because you belong there, not in a fancy eating place.”
That thing took two million photos. Viral. This is my reaction. Until now, people have come in to meet me. But, Matt, let’s get back to this guy. As a result, Matt labels me a liar. The Brooklyn Dumpling Shop is a deception. Take a look at this image. I was able to obtain the image. I received the proof. I give my response. I stated, “We don’t even have pig potstickers on the menu, Matt. These are samples provided to us by co-packers since we need to marriage with a co-packer under our supervision and culinary guidance in order to develop to 140 franchisees. Or else we won’t be able to service 140 shops in the following 30 months.” As a result, he says, “That’s nonsense! You’re a phony!”
So, as I already stated, “What do you think of this? Because I believe you’re simply a hater, why don’t you come to the restaurant with me and we’ll go over every inch of it? And you decide if I’m correct or you’re correct. Why don’t you go up to the plate and embrace the challenge?” Finally, he showed up yesterday.
I like it.
“You know what, I’m going to give you a lot of respect for showing up because things got hot,” I remarked. I stated, “You’re a troll. This is who you are…” We also took a tour of the entire restaurant. He even photographed me and the freezer, which was surrounded by 10,000 dumplings. He then just re-posted it on Yelp with a five-star review and stated, “Oh, my goodness! Oh, my goodness! I was mistaken.” What’s more, guess what? This man is incredible. This person, in essence, was so enthusiastic about his product that he proved me incorrect. When I thought I got them with the photo, I discovered that all these folks are doing is buying dumplings from a third-party public relations firm and posing as a “dumpling bakery.” “I feel horrible,” he says. I labeled them a liar since I had just completed a full walkthrough of the restaurant, from the freezer to the rear of the house, including all of the reach-in boxes. And the only item I’ve seen from a third-party source is, “This is merely a sample. Don’t use it.”
He also updated his Yelp review. Now everyone is reacting to it since we were at odds with each other.
In the old world, you weren’t meant to do anything technically, but I believe in Yelp. You can’t let these get away with it… If you’ve made a mistake, please accept my apologies. Make a promise to yourself that you’ll do better. Send them a DM. To make them happy, throw the house at them. However, there are a few detractors. Another category of haters is those who believe we are taking digs because we utilize The Automat. We’re saving jobs now, I say. As an example, “What exactly are you puffing on? What do you mean you’re putting money aside? You confessed it in this article and this article and this article and this article and this article and this article and this article and this article and this article and you now have five employees instead of eleven. How are you going to save jobs?” “I’m saving a lot of jobs,” I remarked. Things like that “Justify your position. Explain yourself, liar.”
I swear to God, these individuals message me on Facebook, Instagram, TikTok, and other social media platforms. TikTok is a necessary evil, but they’re tough as nails. And here’s something I’d like to share with you. This is all I have to say about it. Within three years, seven out of ten eateries fail. This is a well-documented research. Seven out of ten. Excessive payroll is the primary reason. I didn’t even consider what’s going on right now. Payroll is nowhere to be found. But it wasn’t for that reason that I did it. We don’t have that information yet, but wow, it’s on its way…
That really promotes The Automat, you know what I mean? Do you have a hard time finding people to work for you? Carry out The Automat. You halved the size of your team. To return to my pre-COVID response, we may have a smaller footprint, a smaller work force, a smaller infrastructure, and a lower overhead. We shall, nevertheless, save. Why don’t we turn the tables on the statistic that 7 out of 10 eateries fail due to exorbitant payroll? Maybe those 7 restaurants wouldn’t have to close if we could reduce payroll from the industry standard of 30% to 15%. As a result, jobs are being saved. Not simply the positions in the restaurant itself. So, how about the butcher? Is he the man who grows vegetables? What about the man who shines shoes? How about a trip to the dry cleaners? What about the person who delivers the food? It has ramifications in a slew of other disciplines. There are several additional industries. So, if we can reduce the industry average payroll from 30% to 15%, we will save jobs.
Absolutely. And it taps into something that no one has really linked the dots on yet. We could probably devote an entire episode to debating the folly of people who, based on a single data point and a single instant, leap to a radical conclusion and then cling to it until the very end.
If you’re reading this, Mr. Matt, congratulations on your humility. For one thing, having the courage to follow up on an invitation/challenge and accept it. Second, I had the humility to swallow my ego and say, “What’s more, guess what? I made a mistake.” I can’t give him enough high-fives because the world needs more of him.
Do you want to hear something out of the ordinary? He’s a well-known venture investor who wants to be a part of our next round of investment.
It’s fantastic. What are your thoughts? And there’s a lot to unpack here as well. We also have a big group of folks who aren’t necessarily public relations specialists, but who have a PR bent or need to engage with the public, and who have a whole different perspective on how to manage Yelp. And so, to hear your candor on this, and to have the courage to say things like, “I don’t care if this is your view. You’re mistaken…”
And I’ll teach you how to do it.” “Bugger off,” for example. “You are not welcome here.” Since I believe that more people value honesty because most people are aware that Yelpers are split 50/50. They’re usually full of nonsense half of the time.
Yes. You must keep that in mind. It’s amusing. Brooklyn Dumpling Shop and Brooklyn Chop House, for example. Our shop receives between 3 and 4 thousand visitors each week. We barely got around 10 Yelp reviews every week. So, out of every ten Yelp reviews, we generally get one or two haters and eight people who give us five stars. So, if you think about it, if you look at the data, individuals who are generally haters, angry, or have an agenda go on Yelp because that’s where their rage goes.
That’s 1 person out of 2,900 who like Brooklyn Chop House or Dumpling Shop. Why aren’t they writing anything? Because they almost never do. There aren’t many people that want to return to a site and leave a review. They went out of there beaming, and they left it that way. So, it’s fascinating to see where people are today, because we recently made a deal with Miso Robotics. Using robots on the fryer and griddle, we’ll reduce the number of employees in the kitchen from five to three. What’s more, guess what? I’ll use the same reasoning once again. We’re trying to save employment. Maybe now I’ll be able to raise the payroll up to 10%. You’re taking a quick look at a single business and saying, “Look at how you went from 11 to 4 staff. You’re robbing people of their employment.” And if you go to Miso Robotics’ Instagram, you’ll see that I gave a detailed answer. Because each and every one of the comments is unique “This irritates me. You’re stealing jobs, plain and simple. You’re robbing people of their employment.” No. By embracing technology, we are really generating and saving employment. When you consider the larger picture.
Because I want seven out of ten restaurants to be successful. I don’t want them to go down in flames. That’s exactly what’s going on in our sector. And it’s just going to become worse as lawmakers continue to prolong jobless benefits. It’ll just get worse. I didn’t mind if everyone was on unemployment. But now that the economy is up and running, turn it off.
Furthermore, it is critical to think in this manner. Because one of the reasons why people aren’t returning, and this is based on anecdotal evidence from another party. It was one of my friends. It’s entirely because the government pays them so well. That is unquestionably a factor. And everyone with a brain understands this. The other, and perhaps more important advantage is that the revenue is predictable. So, when states threaten to shut down operations if I return to work, how do I know my job will be there tomorrow? People want to work where they know their employment will be there next week, next month, next year, and they can advance, so when you have longevity with a good concept, people want to work there.
Think about the chances to start in the kitchen. After that, go on to robotics. Because it needs to be a route that recognizes that at the very least. You started engaging with the robots, for example. You begin to like it. And this is awesome.
It’s all governed by artificial intelligence. So, robots are doing great things. Yes, instead of 5 or 3 or 2 workers in the kitchen, your workforce will be cut in half.
Is it effective? What’s another restaurant killer? Consistency. That will no longer be an issue for you.
Everything is how it should be; there is no room for human mistake. Another killer is inconsistency. You go one day and give it your best shot. You have a capable A on your team. You go the next time you have had B. It makes no difference to me whether A or B is better or worse. It’s distinct. And it will damage your brand, especially if you enter international markets. It makes no difference to me where I am. I can get the identical Double Quarter Pounder at McDonald’s in Mexico, Italy, Greece, Lisbon, Portugal, or anywhere else in the tri-state region. The same french fry will be served to me.
Because they are dependable. And it is because of this that the chain thrives. What’s more, you know what? If we could reduce payroll from 30% to 10% to 15% using AI technology, robots, and automation, the chances of us failing are little to none.
Of course. Lower by an order of magnitude.
Let’s just suppose we make a mistake and end up with a place that doesn’t function. What’s more, you know what? We’re losing 15% of our revenue every quarter since we’re not profitable. We’re on the verge of failing in one of our locations. As business owners, we all have that. That will be available to each of us, as well as every franchise throughout the world. The concept is that it shouldn’t account for more than 10% of your total sales. However, this is something that every franchise possesses.
Wouldn’t it be fantastic if all the companies that are failing and are losing 30 percent or even 40 percent of their payroll? Payroll might sometimes reach 40% of your whole income. Isn’t it fantastic if you could save 15 points?
Yes. I’m talking about the remaining open and, honestly, simply a gradual or rapid burn.
What happens when you close the door?
Right. Everyone has lost their job and is looking for a new one. The long-term implications of decreasing, or maybe better said, optimizing labor are that restaurants stay open longer, and everyone benefits. Because when a group of restaurants fails, so does everyone who provides services to those businesses.
We had a difficult time surviving the pandemic since all we work with is eateries, and we were there. For a few clients, we lowered the price. We did everything we could to keep the train on the tracks. As a result, many individuals are perplexed. They find that one small moment once more. They cling to it. They don’t consider any other variables, which is a pity.
So, I have one more question before we land this plane since I know you have a business to manage. I was intrigued by the name Brooklyn Dumpling Shop, and my question for you is: what are your opinions on the brand’s durability or feasibility as you expand throughout the country? For some context, we have St. Louis Bread Company, which eventually rebranded to Panera when they expanded outside of St. Louis, and there are others as well.
It’s an excellent question, because Brooklyn now has the greatest brand cache of any city on the planet. I believe there is a YouTube video if you ask the proprietor of Brooklyn Lager. He’s going to say… His initial name escapes me, so let’s just assume it’s Joe. “If it was called Joe’s Lager and was worth one-tenth of what my company is worth now,” he would say. The only reason is that he will see the word Brooklyn up and down the spout while you’re seated in a pub in Ireland or a bar in Hamburg. You’re tempted to try it out. It doesn’t have all of the accolades I’d want on that topic. However, the term “Brooklyn” has a lot of brand equity and prestige.
We named it Brooklyn Chop House since we are located under the Brooklyn Bridge but on the Manhattan side. And what we wanted to do was pay homage to America’s first culinary wave, which included Irish immigrants. They built chop shops in the 1850s, serving mutton chops, lamb chops, veal chops, and whatever else was available. They’ve all started in Brooklyn. Peter Luger is the only remaining chophouse. That was the case with the 1850s Irish immigration. Apart from pizza, that was the first gastronomic wave. Because some people in Little Italy were making pizza on a small basis. Chophouses, on the other hand, were introduced in Brooklyn.
So, when we were thinking about the name of our new chophouse beneath the Brooklyn Bridge, I knew it had to be a chophouse since my father owns six Chelsea chophouses that began in Chelsea, New York. He reached out to New Yorkers from all walks of life. Outside of the suburbs of New York, the word “Chelsea” is used. And he performed really well. KFC was founded in Utah. So, to me, what we’re dealing with right now is a big Walmart contract that will be implemented in around 1,800 Walmarts in September or October. They’re ecstatic about the name, and the package is black and reminiscent of the Brooklyn Bridge. It’s the polar opposite of what you’d find on a shelf of pastel hues. We aren’t going to do any of it. As a result, we feel I should be the polar opposite.
I’m in the middle of a meeting right now. They possess all of Europe’s subways. They also adore the term “Brooklyn.” They adore Harley-Davidson motorcycles. “We are very pleased to introduce Brooklyn Dumpling Shop to Hamburg,” they basically said.
Because Brooklyn has a worldwide following. It’s the most fashionable. It’s considerably larger than Manhattan. What are the top three terms used to brand a product in New York? Number one is SoHo, Harlem, and Brooklyn. As you can see, a lot of individuals include Brooklyn in their names since it is immediate brand promotion.
Yes, Staten Island in particular. You were not selected.
No. It’s just not the case. Brooklyn is a trendy label. We’ve demonstrated this with our merchandise. Hoodies, shirts, caps, and similar. It’s incredible. Everyone does it through our mail order at brooklynchophouse.com or Brooklyn Dumpling Shop, and they buy our products just because the name Brooklyn is there. That’s fantastic. So, here’s what Brooklyn does… I’m not sure if you heard, but we just completed the largest COVID deal in Times Square. With the opening of Broadway in September, we’ll be launching a 25,000-square-foot Brooklyn Chop House. We also offer a separate area dedicated to goods. The word “Brooklyn” is extremely marketable. And now we’re hearing from Walmart’s head buyers to all of our franchisees. Jimmy John’s Subway Shops in Minnesota is owned by the folks I recently acquired.
They’re putting on a show called 30 Brooklyn Dumpling Shop. “You have no idea how happy we are to bring Brooklyn to Minnesota,” they say. “You have no idea how excited we are to bring Brooklyn to Houston, Texas, or bring…” Then, when we start offering pastrami dumplings and start adding signatures like the Rueben and the New York, it all comes together wonderfully. We’re here to help “Wow, it was incredible. With a pastrami dumpling, I’m getting a flavor of New York, Brooklyn.”
Wow, that’s fantastic.
It’s a great fit for us.
There’s a lot to look forward to. So, one last question before we wrap this off. Before you die, this is the final dumpling you may eat. What is the flavor?
I think I’ll go with Gayle King. Before she goes to the electric chair, Gayle King says. The bacon cheeseburger dumpling at Brooklyn Chop House and Brooklyn Dumpling Shop will be her final dumpling. So, I’m sticking with Gayle King…
Apparently her last dinner on Earth will be the bacon cheeseburger dumpling at Brooklyn Chop House and Dumpling Shop, which she already wrote about in O magazine: “My last meal on Earth will be the bacon cheeseburger dumpling at Brooklyn Chop House and Dumpling Shop.”
This is a huge compliment. That’s fantastic. Well. Take a peek. Thank you for your consideration. Thank you so much for what you’ve shared with us. There’s a lot to take away from this. I’m excited to see how this brand grows in the correct direction over the next few years. And you’ve got a real find here. Thank you for your consideration.
Thank you very much. Thank you for inviting me.