Fresh off quitting his hedge fund job, Jon Sherman piled into the car with his food distributor and headed to the Restaurant Depot. Sherman was soon, literally, comparing apples to apples, and picking up a 50-pound case of potatoes that looked all too familiar. “My jaw dropped,” he says.
Sherman was paying double, in some cases more, for the same products flowing into his New York City fast casual, Sticky’s Finger Joint. It wasn’t the easiest or most enjoyable field trip he’s taken, but it might have been the one that saved his concept’s life.
There are currently four Big Apple locations of Sticky’s, which debuted in 2012, and more are in the pipeline. Sherman says they’re searching for a strategic partner who can help the restaurant saturate New York City and beyond.
But none of this would have been possible without some hard knocks early on. “Of course we weren’t going to make money [paying that much for food],” he says. “We were selling some menu items that were so expensive to produce that we would have had to charge triple to actually make money off of them.”
Sticky’s also had labor issues (“we didn’t really have a good understanding of what the staffing model is”) and miscalculations across the board. Sherman and his partner, Paul Abrahamian, underestimated the startup costs and were left without any real capital in the bank. “When we started, we were losing money because we really didn’t know how to operate a restaurant,” Sherman says.
As for how this all turned around, Sherman rewinds back to those early lessons. He was a successful Research Associate at Bridgewater Associates, even recently earning a promotion, when Abrahamian brought up the idea of a restaurant. The two childhood friends floated this topic before, discussing concepts they thought made sense and ones they admired. Sherman, who was living in the Lower East Side, watched as the Meatball Shop opened to block-wrapping crowds.
“I remember just thinking, these guys have a place built just around a single item that they’re taking ownership of. And this place is killing it,” Sherman says. “Personally, I like chicken fingers more than I like meatballs and I kind of thought other people do, too.”
They tried to design the restaurant so Sherman could keep his job in case it crashed. But it quickly became apparent that his other career might have something to do with Sticky’s startup problems.
“After two months of being opened it was a lot for both of us to handle. Neither of us really had any restaurant experience and we were also naïve about the startup costs and the ongoing costs,” he says. “It had become apparent to me that if I wanted to keep my job at the hedge fund I was going to be at risk of losing the restaurant.”
“I quit my job and, five years later, we’re here,” he says.
When Sherman left the hedge fund, he took a fine-tooth comb to the restaurant. The glaring issue was centered in the back-of-the house with food costs. The pair had invited a chef from a neighboring restaurant to come and help, and he ended up ordering “a bunch of expensive stuff that we never actually sold.”
You wouldn’t think food cost could weigh down a chicken finger concept. Sticky’s is different, however. The reason the brand stands out from a crowded market, one dominated by the Zaxby’s, PDQs, and Raising Cane’s of the fast food world, is its elevated and unconventional menu. Ever tried a salted caramel pretzel chicken finger? Or what about the Vampire Killer, which has vampire aioli, grated Parmesan, garlic chips, and pink peppercorn flakes? There are 19 sauces and sides like bacon mac fries and s’more fries.
The food itself, Sherman says, has always been a hit. “The thing was, even from the opening day, we got a great response to the food. It was never a demand issue. People loved what we were serving from day one. It was just what it took to actually produce it. It wasn’t a money-make proposition,” he says.
Sherman switched distributors and went through waves of negotiations as he dug into what everything should cost. For around a month, he drove back and forth from the Restaurant Depot with food iced in the back of his car.
Sherman says it took six months or so for things to stabilize and for the partners to break even. The first store opened March 22, 2012. On July 1, 2014, the second location sprung up in Murray Hill.
This experience was far removed from the first, and it arrived in fortuitous fashion. He made contact with a landlord the day a deli closed and was already second in line. That’s just how life as a restaurateur goes in Manhattan.
When the other deal fell through Sherman received a call and the process was underway.
Sherman had some backing and experience this time, and the second location, unlike the first, was a complete gut renovation. “I learned a lot of things the hard way. From electrical issues to air condition issues to exhaust issues,” he says. “We had to build a whole new staircase, which might not seem like a huge deal but the process you have to go through to put a staircase in is crazy in New York. Like everything else.”
The success of the second location led to a store in Hell’s Kitchen. The brand’s Financial District location—its fourth store—opened in February, making it two units in the past year.
Along the way, it became clear to Sherman that Sticky’s was a brand with scalable DNA.
“We really thought this was a concept that was simple enough but elegant enough that people in New York would love it,” he says. “And we really believed from the get-go that this would be a concept that could work in a lot of different places, in different states and markets as well.”
Sherman says they have taken that approach all along. Just looking at the success of chicken in quick service, he believes Sticky’s can drop a pin in cities across the map.
For now, he’s not interested in franchising—the path many of those larger chains have taken—as Sticky’s continues to refine its model.
“You talk to 10 people and you will get 10 different answers on the franchised versus company-owned debate. But I can tell you our mindset is that I’m certainty not ruling out franchising in the future but that is not part of our plan right now because we really want to hone in on the perfect restaurant; how to build them, the perfect menu offering, the perfect guest experience. We’re really just trying perfect the concept and I think we’ve gotten pretty darn close to what that prototype is.”
“We want to take it upon ourselves to push forward with the next wave of growth.”
The next step will be taking Sticky’s to a new market, whether that’s a different state or a suburban location. Washington, D.C., Boston, Philadelphia, Chicago, Long Island, New Jersey, Westchester. Everything is on the table.
“We’re going to have to take that leap. Testing out a new market is really going to help us prove that we are not just a New York City concept,” he says.
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