Sometimes service firms have to look a bit beyond their business and try to learn from others.
About five blocks from my offices in Ann Arbor is a special place called Zingerman’s Deli.
The New York Times apparently likes Zingerman’s as well. In a recent profile noting Zingerman’s 25th anniversary, the unique approach to service and strategic planning is examined. Not the three year plan. Not the five year plan. How about the 15 Year Plan:
But neither the festivities nor the variety would have been possible if Zingermanâ€™s co-founder, Paul Saginaw, had not dragged his business partner, Ari Weinzweig, to a bench in front of the deli about 15 years ago and demanded that they start thinking about where they wanted their business to wind up.
Mr. Weinzweig was reluctant to break away from his routine of running the deli, then generating about $6 million a year in sales, to brainstorm. But Mr. Saginaw insisted.
What resulted was a plan to retain the unique attributes of Zingerman’s (including high levels of service and premium pricing) but grow the business. The plan for 2009 (which was begun in 1994) targeted growing revenues to $20 million without franchising. With two years to go, Zingerman’s is ahead of plan, and on track for $30 million in revenues this year. There are eight separate operations (that include a bakery, restaurant, coffee-roasting company, catering, and a training business). It was also profiled last year in this book by Inc. magazine editor Bo Burlingham.
What does this all mean for the legal market beyond a good caterer for your next closing? Zingerman’s rebuffed repeated approaches to sell, merge or franchise. Phone cards. Profitable in the short run, probably destroy the brand in the long run. It also really engaged in real long-term strategic planning, not the dressed-up fancy tactical stuff that masquerades for it in many environments.
Note also that Zingerman’s retains premium pricing (up to $13.99 for a sandwich), but invest a lot in the product and share a great deal with staff on things (margins sometimes as thin as the sliced pastrami). Not great for the owners in the short run, but certainly allows them to attract and retain the best people.
From my personal experience the most notable aspect of Zingerman’s is what you see when you walk into the deli and how you feel after placing your order with the smart and helpful people they have behind the counter. Definitely not a commodity-type operation.
I think people (which include in-house counsel) will pay top prices for premium service. The feeling that some GCs have is that they are always on the fixed-price menu, paying the same for the deluxe reuben as they do for white bread, toasted.
On the left of the article text is a delectable (and short) multimedia show about Zingerman’s. Turn your speakers up and you can almost smell the corned beef.
I think I’m going out today for lunch.