In the dramatic stock market fluctuations of the past weeks, economists have been warning that the United States may be heading into a second, more severe recession than the one our nation suffered in December 2007. We business owners and franchisees around the country are bracing for the worst and will strive to keep our businesses thriving in the months ahead. As chief executive of Apple-Metro Inc., a company with 34 Applebee’s Neighborhood Grill & Bar restaurants in the New York area, I was able to grow my business in the last recession — opening 10 new restaurants since 2008.


I offer the following 10 tips that I used as a guideline in the last recession to grow my business. And given the current economic forecast, these rules will become even more important to the health of my business in the months to come. 



1) Hire with precision — and art 


Our employees have to know the menu and be able to deliver dependable, friendly service — no exceptions. We also try to determine whether candidates will be a good fit. It’s not important how competent people are if they can’t get along with their peers, direct reports or supervisors. 


Résumés are standard, but given the cottage industry of professional résumé writers, that document has become less reliable. Interviews are more critical. Management-level candidates must survive an extra level of scrutiny. Batrus Hollweg, an international testing organization, offers ways to measure aptitude and to model potential success in a specific environment. There is an added expense to this testing, but it is well worth the investment.


2) Leverage real-estate opportunity 


In troubled times revisit your lease and renegotiate. You should look for deals that may not have been priced appropriately the first time around. Also, look for new deals at more competitive rates. At Apple-Metro we believe in always pushing forward as an everyday key practice, not just a practice during hard times. At the moment, we have six deals on the table for development and are continuing to look for more.


3) Take a long-term approach to the marketplace


As you battle through the hard times, look beyond the clouds and into the horizon. Analyze your product and its value to invest in the future. At Apple-Metro, we know people love to go out to eat in a comfortable, friendly environment that can provide a great product as well as service, at a reasonable price point. With longer-term goals in mind, we look to refit our restaurants where appropriate so we maintain a comfortable setting with the product our customers rely upon from Applebee’s. It’s an investment that solidifies our customer base and sustains us regardless of the economic climate.


4) Have strong retention practices


Businesses are only as strong as the executives who run them and the support staff that keeps them moving. It is important to create a stable, healthy environment that characterizes your business. For example, Apple-Metro always is quick to award hard-working and dedicated employees with incentives such as cruises to Bermuda and an automobile lease program for managers. This is important to keep enthusiasm and dedication to the company high while reducing turnover rates. 


5) Make the most of your marketing budget 


A franchisee generally does not have a voice in how marketing dollars are allocated by the parent franchisor. That’s why franchisees must take an active role in the process. One way: Participate in franchise councils. We campaigned for and now hold seats on three of them, including the Franchise Business, Franchise Kitchen and Franchise Marketing councils.


Another strategy: Team up with vendors — and I mean all of them, from food suppliers to security firms — to develop joint marketing campaigns. This cross-promotional strategy goes for businesses more unrelated to your own, too. In our case, we have had great success partnering with local attractions.


6) Splurge to save 


Capital expenditures always are painful, especially when the returns on those investments don’t come for months or years. But there are ways to save a lot of money later by spending a little now — and even green up your operation in the process. Three examples from our operation:


• Waterless urinals: These cut our water bills by saving us 40,000 gallons of water per year.


• LED lights: Replacing all recessed and track lighting fixtures with LEDs reduced our restaurants’ kWhs by 88 percent.


• On-demand (tankless) hot-water heaters: They’re 84 percent more energy efficient.


7) Be willing to try new products


There are three ways to learn: introspection, copying/mimicking, and trial and error. We didn’t serve breakfast for years — it wasn’t part of our corporate mix or core business. But given high rents in Manhattan, we needed to revisit our model and squeeze the most out of the box on which we pay rent 24/7. To retool for the breakfast crowd, we had to tweak our service cues, work out staff scheduling and refine the menu.


8) Conquer your supply chain 


Franchisors have standards for approved vendors. We go beyond those standards and conduct separate audits of financial stability, delivery competencies and the like. Also, never put all your eggs in one basket. If one vendor can’t deliver, make sure you have another — perhaps in a different location — lined up in a pinch.


9) Mind the metrics 


Our managers are expected to watch a number of metrics on a daily basis. Food, liquor and labor costs are the basics. Managing those means that you are running a tight ship and delivering good service — which means that revenue will follow. Cash flow, EBITDA, guest feedback, internal operational performance inspections, city health inspections and staff turnover also are reviewed on a weekly basis.


10) Reiterate the mission 


Our steering committee meets once a week. At the beginning of each meeting, one of us will read aloud our mission statement and strategic initiatives for the current year as a reminder to maintain our focus. 


Zane Tankel is chief executive of Harrison, N.Y.-based Apple-Metro Inc., the New York metropolitan area franchisee for Applebee’s Neighborhood Grill & Bar. Apple-Metro’s portfolio includes 34 Applebee’s in the five boroughs, Westchester and Rockland counties.