In many ways, the COVID-19 rebound has been a story of the haves and the have nots. Those brands that recovered best from the spring 2020 sales plunge are largely those that have drive thrus, digital ordering, and a product that travels well and suits group needs. And those that are still fighting their way back into the black are the brands that didn’t already have those elements baked into their DNA before the pandemic.
Count Raising Cane’s, the chicken-finger giant with roughly 550 locations in 30 states, as one of the “haves.” The company lost 30 percent of its sales in the weeks following stay-at-home orders last March, but leveraged its drive thrus and chicken-finger boxes to surge back and finish 2020 with $1.8 billion in sales—clearing the company’s expectations by 10 percent.
But there was one other thing in the Cane’s “have” column that became something of a super power, something not every restaurant company could add as simply as third-party delivery. Raising Cane’s had its culture, which it’s spent 25 years cultivating with its crewmembers and Restaurant Leaders (the operators of each individual store). That culture is something founder Todd Graves has been working on since he opened the first location in Baton Rouge, Louisiana, in 1996, and helped the company clock in at No. 89 in Glassdoor’s most recent “Best Places to Work” list. More importantly, it helped Raising Cane’s weather the depths of the pandemic and emerge even stronger than it was before.
QSR recently talked with Graves and co-CEO AJ Kumaran about how Raising Cane’s brings its culture to life, and how it’s paid dividends during the COVID crisis. (This interview has been edited for clarity.)
What was the culture that you wanted to build, and how did you go about building that from day one?
TODD GRAVES: This was a college dream for me, and so I didn’t even know what culture was and how it applied to business. I had worked in restaurants in high school and college, and just really loved the business—the fast pace, the camaraderie. I’m a people person. I love delivering a quality product to a customer and seeing their smiling face. I wanted to start a business that was basically something I would love to go to every day.
I went through a journey taking the business plan to just about every bank in town, nicely getting turned down, and then realizing I had to raise the money myself. I worked as a boilermaker in refineries not only in Los Angeles, but in Hawaii, Denver, and other places I could get work. It’s hard work, but you make a lot of money doing it. I was able at that point to have enough seed money and get a few small investors and a small SBA loan to open that first restaurant.
I tell you this story because it really built our values as a company, and the foundation of our culture. If I would’ve just had the money or I went to a bank and they said, “Here’s your money,” our culture wouldn’t be the same and my personal values wouldn’t be the same, because I wouldn’t have had to work so hard for it and I wouldn’t have been so appreciative.
Our culture was rooted in appreciation. It was appreciation for the crew because my crew is helping me achieve my dream. And so that’s what’s carried on. I had to assemble leaders in my company and retain leaders who were aligned to those values and to that culture that we had in the first restaurant with me and my crew and my team.
You’ve now scaled to 500-plus restaurants. How do you maintain that culture?
AJ KUMARAN: A lot of people talk about culture as this thing you cannot define—you cannot touch it, you cannot feel it. It’s actually very much living, breathing; you can feel it from what Todd speaks about of his first days at Cane’s.
Think about the restaurant business. How many businesses still have a founder in them, and live that founder’s values? They often take capital investments or something else, and culture and that founder presence kind of erode. If you look at our business, it’s really not even Todd and I; it’s the hundreds of Restaurant Leaders who are right now, right this second, leading our crewmembers in those restaurants. They live those values.
Scaling culture is about finding those same people like Todd found in those first few crewmembers. My job is to make sure that everyone who steps into our business has those same values. And honestly, once you have that culture running, the system will immediately reject the wrong people who get into the business. They don’t last.
How do you identify leaders and encourage them to see Raising Cane’s as a career?
AK: In 2021, we will have about 1,500 internally promoted managers in our business, who in the future will become Restaurant Partners and pursue a long career and journey with us. We take pride in that high school teacher who 15 years ago was a crewmember at Raising Cane’s and learned how to work and engage with folks in our business.
Almost 60 percent of our managers come from internal promotions. Because we’re fast growing, we also want to bring in external talent. We want diversity of thought, diversity of thinking, all of that. But those internally promoted crewmembers, they get best-in-class support. As they go through college, we have a great program to support them through their education. Our training program for our Restaurant Leaders—almost one full year that we invest in them—most restaurant businesses don’t do that these days, but we do because we see the value in it in the long-term. And you don’t just speak to them about managing the restaurant. We get into positive motivational management. We get into great financial discipline, great crew coaching skills, and how you secure yourself and your family through great financial planning.
TG: You have to have a culture of constantly looking for talent and promoting talent. That starts with us. If you don’t promote it and do it, people won’t see that they have growth opportunities within your own organization. Starting out as a young business person many years ago, I just thought people would organically know it and ask about it and do it. But if you don’t make it a full program, and if you don’t have it to where the crewmember understands that program, and management doesn’t constantly look for talent, then you’re not going to promote people.
It’s the same thing with diversity; if you’re not looking to get diverse and you just think it’s going to happen organically, it’s going to happen at a slow pace. It needs to be a really conscious effort.
How did you see your culture pay dividends when COVID first hit?
TG: We’ve been through other challenges in our company, like Hurricane Katrina; we only had 28 restaurants then, and 21 of those went down. But we figured that out and we knew we’d figure this out too.
All of a sudden, business dropped 30 percent overnight. That’s basically our dine-in. When you are leveraging your company, even if all your cash flow is good, if all of a sudden it goes down 30 percent indefinitely, that’s not a good feeling. And so we went to the team and said, “Hey, we’re down 30 percent. We’re going to figure this out, but we need to bind together. The first thing to do is to keep your crews safe and your customers safe.” We started off with CDC guidelines—washing your hands, sanitizing, wearing masks, keeping things apart. Then we got more sophisticated. We put in drive-thru shields, which AJ got to deploy in a very short period of time. It was like a stab in my heart at first, because I’m thinking of our crewmembers having some kind of shield, but I drove through it after they put one in and you could still see the smiling faces. Then we accelerated our mobile payments so guests could do touchless payment.
What was key was communication and being very honest with our team the entire time of what was going on. Our team showed up. Everybody showed up, literally: Restaurant Leaders, me, AJ. We had to keep the company going. We were essential workers. We had to feed the public. This is what our responsibility was, and we were going to do it in the safest manner we could. Anybody that was able, that was healthy, that didn’t have precondition stuff, showed up.
That’s how culture comes back to you and fills you with so much pride. It was the same thing with Katrina; Katrina hit, 21 of 28 restaurants go down to that storm, and my team showed up. We all got together as a team and did it. And if you’re honest to them and you have a good culture, it comes back in spades. We were down 30 percent, and people volunteered to say, “Hey, give us less hours so nobody has to get cut. Let’s all just go down a little bit.” How awesome is that? It just fills you with pride.
We started this mantra, “No Crew Left Behind.” We made that a mission, and because of these great people, we were able to rebound. Our sales went from -30 to up 10 percent. We’ve been able to bring everyone back and to do a bonus for them. That’s what happens when you have a strong culture: When the going gets tough, the tough get going and they show up, and they make sure your business will be OK.
How do you think Raising Cane’s will have evolved from this season?
AK: Our goals and aspirations haven’t changed. We have been a growth business. Our trajectory remains the same. We continue to grow through this.
There is a stronger level of appreciation for what we’d just taken for granted—just being able to say hello to someone. Our Restaurant Leaders had to learn to meet their crewmembers virtually. These are crewmembers they would have otherwise given a hug to, or shaken hands with, and gotten them started on day one. Some of those things will stick long-term. We’ve become way more efficient as a business. I’ll tell you, me as an operator, I thought if I don’t go to every restaurant and roll out something, it wouldn’t be done as well. Now we’ve proven that we can.
But also, some of our values shine through. As businesses scale and evolve, certain things tend to go down a little bit. For example, entrepreneurial values, how quick you are, how nimble you are, and those things shine through in times of crisis. Todd and I, in the early days of this crisis, we used to say, “Let’s not let this crisis go to waste. Let’s learn from this.” One of our other values is that we are students of this business. We are constantly learning every single day.
TG: I can tell you from Hurricane Katrina, it galvanized our team—absolutely galvanized. Going through something so scary and hard, they got through things together. Our major leaders are people that rose up during Hurricane Katrina. Our head of restaurant excellence (Clint Penfield) and our head of training (Ben LaTour) come from that Katrina team. That was 16 years ago. You go through those things and you have that pride together as a team.
Our industry didn’t go virtual; our industry stayed and worked in very hard conditions. I think it’s going to make us all better. I think it’s going to make every company out there stronger, better, more galvanized, and have a greater sense of purpose. Out of something really bad, there’s going to be good for the quick-service and fast-casual industry.