One year ago, GoodFella's Pizza was just another one of the 148 pizza stores you'd be able to find in the Scranton, Pennsylvania phone book. Today, having doubled sales during the last 12 months, they're the biggest success story in the market. GoodFella's does a steady, $20,000 per week in a market where the typical independent does $3,000. How does owner Tommy Hashem do over 6 times that amount? Be patient. You are about to find out how he turned an average store into a Million-Dollar-a-Year-Success.
Background
Like so many successful pizza entrepreneurs, Tommy started college but never finished. He studied finance at the University of Scranton for one year. Although he earned a 3.9 grade point average, he wondered whether he should really be doing something else. Sometimes a special teacher has a positive life-long impact on a student, but this story is just the opposite. "Ok, you want to know why I dropped out? You won't believe this," he said half apologizing and somewhat embarrassed. "I had this professor that really knew his stuff. I knew I would never know as much as he did, and yet he…well, he just seemed like such a geek. The way he dressed, the way he talked, and he wasn't making the kind of money I was interested in. I thought, how is this guy going to teach me how to make money? At about the same time, a millionaire friend of my father named Elmo Baldasarri, who is a very smart man but with little formal education, asked me a question that made me do a lot of thinking. Who do you think is going to make more money – the guys who get all As in school or the guys that get Fs? It's the guys with the Fs. The guys with the As do nothing but follow the rules, but the guy's with the Fs are willing to take risks. Then when the opportunity to get this great pizza store location at a great price came along, my decision was made." GoodFella's Pizza first opened their doors on September 1, 1994, just in time to serve the University of Scranton students for the new school term. The initial crew consisted of Tommy, his right hand man Bob Bingham, and one driver. This was the beginning of a long learning experience filled with mistakes and lessons that would eventually lead to success. By the end of the first semester in business, GoodFella's was doing $1,500 a week, hardly enough to make a profit,
However, with continued refining of his menu, product, and service, sales went to $3,500 by May of 1995. That's when Tommy got the expansion bug. He wanted to own a second store in nearby Wilkes Barre. It was beautiful and gave Tommy everything he wanted in a store except one thing: the ability to personally oversee two stores at one time. As it turned out, the venture was a distraction, and he eventually closed it. Tommy decided that he would go back instead and focus his efforts on one store. Focusing his efforts entirely on his Scranton GoodFella's, he was able to bring sales up to $10,000 per week in May of 1998 and then continued on to the current weekly level of $20,000. Originally, the idea was to be a campus store and that's where the business originally came from, but as time went on, he discovered that most of his business was coming from the residential side. "There are a lot more residents than there are students in Scranton. I figured if I really wanted to get sales up, I needed to go after the most targets," Tommy says. And that's why he began to develop marketing strategies to capture the residential market.
Tommy's Sales Approach to Building Sales
Over the last 5 years, Tommy has been fortunate to have his father (Tom Hashem, Sr.) and his uncle, Ame'Joe, help him in ways that allowed him to keep focused on the general course of the business. His father's restaurant experience was invaluable in the early days. And now that GoodFella's is a success, he helps by handling bookkeeping chores, taking a load off Tommy's mind. His uncle orders the food, and Bob Bingham runs the day-to-day operations, allowing Tommy to float. Over time, Tommy sees three areas that he focuses on because he has the support of his key management people. That leaves him with just three jobs that he insists on doing himself: 1) He is the Store Quality Inspector
2) He is the Customer Service Fanatic
3) The Store Marketing Director
Store Quality Inspector
The food served at GoodFella's really is good, having improved slowly and steadily over the last five years with small adjustments in store management. These changes come one at a time as he talks with customers, tastes the product, and watches his operation. One of the adjustments Tommy made was to eliminate the idea of cross-training employees to do multiple jobs. GoodFella's is organized to have three key inside specialists during each rush for pizza, wings, and a sandwich. "It really makes a difference in the quality." In addition, Tommy is constantly testing and tasting. "If I don't really like it…..we won't have it on the menu." Over the last five years, the menu has changed a lot – especially after I got my computer system and started tracking how much I was selling of each product. I started to cut back on what I offered. Now my product mix is:
40% is Pizza
10% Calzone
20% is Wings
5% Drinks
25% is Sandwiches
(Mostly the locally required Philly Cheese Steak)
83% DELIVERY
17% CARRYOUT-NO SEATING.
Customer Service Fanatic
Tommy believes his customers need to really believe that GoodFella's Pizza cares about them and that they are willing to right any wrongs that might occur. If a pizza leaves the store over 36 minutes old, it is officially late. Drivers are instructed to apologize and to tell the customer that if its not hot enough, they'll replace it right then. And that's not all. A report of all the late and bad orders are generated the next day from his Rockland Technology Diamond Touch POS System. A customer-oriented employee is then dispatched to each customer that had a late pizza or wrong order from the night before. They are given a personal apology and a voucher for a discount on their next order.
Store Marketing Director
After making sure that the store quality is just right and that service is good enough to keep customers coming back with a smile, Tommy is ready to go to work with his third management responsibility – local store marketing. Tommy has developed or adopted a number of marketing ideas that have really had an impact on sales. The first of which was his decision to focus on a narrow portion of the Scranton market.
Marketing Strategy
One
Focusing On The Best Neighborhoods with Direct Mail and Doorhanging
"We're competing with guys who look like they have a million dollars to market, but we don't. We just focus on our red zones (high-yield areas) where we get the most results. That way it looks to our customers like we have a million dollars to spend. I've done mailings to our yellow zones (average-yield areas) and blue zones (low-yield areas) and gotten only a third or one half the response I get when I mail to the red." Tommy explained further, "I decide where I have the battlefield advantage and focus on those areas in order to most-likely win. It's more expensive to get a little bit of business from a large area than it is to get a lot of business from a smaller area. In my case, I concentrate on the best 10,000 homes, and those are not necessarily the closest 10,000 homes. I go to the best 10,000 homes in my red zones." The red, yellow, and blue zones were determined by a PizzaSmarts analysis using Mailers+4 Mailing Software (Gary Van Rockle 800-800-MAIL) that compares the number of customers within each carrier route to the total population in each carrier route. Those areas with the highest market penetration are known to produce the best return on marketing funds. Tommy had his analysis done before owning a POS system based on the hand written sales receipts.
Marketing Strategy
Two
Maximizing Use Of POS System Features
Tommy Hashem loves his new Diamond Touch computer system, and he has invested time in it to learn how to take advantage of the features that are there. Many operators buy POS systems with good intentions of using the many features but then never use them. Not Tommy. One of the best ways he uses his data is to track all of his store coupon responses. It pays off big. Not just because he can revise his offers and adjust his menu according to customer feedback but because it gives him negotiating strength when advertisers ask him to advertise. Tommy just takes them over to the computer and says, "Hey look, we only got back 23 coupons from your newspaper. I can't afford to pay you that much," as he negotiates a lower cost on his next ad. It also helps him identify what is working. Recently he tested a list given to him by Jay Siff of Moving Targets. It was a list of new movers. One guy that Moving Targets had given Tommy had ordered 78 times. It's all there at his finger tips.
Marketing Strategy
Three
Community Service
Tommy is always doing something with the community. "It's not hard. People show up with the ideas. I'm just willing to go along with them." Tommy does several events with the University of Scranton each year – such as the "Hand in Hand" program for disabled kids. Scranton Police Bike Rodeo In the residential community, he is a major sponsor of the Scranton Police Department's Bike Rodeo. It is a publicity event the police use to improve community relations, and Tommy is there right in the middle of it. It happens at St. Paul's Church and is promoted with a local radio station. Underprivileged kids get to ride their choice of a police provided bike or a police horse. Tommy does it every year and this year gave away 300 pizzas for the event.
Marketing Strategy
Four
The Hotel Strategy
Tommy currently has four of the area hotels working with him. He has table tents in every room. In one hotel where there is a direct dial phone capability, the phone button that reads "pizza," automatically rings at his pizza store. For this service, he runs a monthly report on his POS system for the hotel phone number and writes a check for 10% of the amount sold. In the other three hotels, Tommy has simply paid each hotel operator a flat $500 per year to be the exclusive pizza promoted inside each hotel room.
Marketing Strategy
Five
Invest in a Graphic Artist
Hashem also reports that a big part of his sales increase is a result of being able to communicate more clearly with his customers. Graphics play a very important part in being able to cut through the clutter. Notice how his yellow page ad commands attention. John O'Connor of Toons, a graphics company in Wilkes Barre, Pennsylvania, does all of Hashem's graphic work. "His contribution has been immeasurable. My marketing simply has become more powerful. He's helped me make my marketing simpler and more noticeable," says Hashem.
Marketing Strategy
Six
Bar Business Rush
The nearby strip of bars has always provided a late night rush to GoodFella's, but ever since Hashem recognized this as an opportunity to expand, it has been doing much better. He recently started selling one dollar slices and nothing but individual slices from the left side of his store on Friday and Saturday night just to accommodate this business, and it has paid off with big dividends.
Marketing Strategy
Seven
Read PMQ Magazine
Tommy gives a lot of credit to PMQ for his success as he reads it aggressively looking for new ideas and new sources for marketing services. Most of the ideas and promotions that he has used during the last year have come right out of PMQ. "I've never been to Pizza Expo before, but I found a great POS system, a postcard source that sells short run printing that allows me to do targeted specialized mailings, a magnet mailer that worked great, a source for pizza photography, and a lot more all within just the last year."
Closing Note: About 18 months ago and somewhat discouraged after closing his second store, Tommy went to Florida to look for a better location for his business. Instead of starting over in a new location, he decided to forge a new business out of the one he already had. And it worked! You've seen how he did it. Tommy's success reminds me a lot of the story we did last Fall on La Nova's Pizzeria in Buffalo. You know – the store that does $100,000 a week! Long ago, Joe Todaro had two stores but decided to focus on just one. He gave up his more successful store and focused his efforts on the store located in the neighborhood he wanted to live. The rest is history. Tommy Hashem, Joe Todaro, and many other successful pizza entrepreneurs have proved that if you try hard enough, try enough things, and believe that your current sales are just a fraction of what they can be, incredible things can happen.
