Nishant Machado reflects on company a year after Sullivan’s acquisition
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Mac Parent LLC, the owner of Romano’s Macaroni Grill, has worked the past year to digest the acquisition of Sullivan’s Steakhouse and to create a company that offers team development and advancement, according to the CEO.
“It’s been important for me to build a company that creates opportunities for our employees,” said Nishant Machado, CEO of the Denver-based casual-dining company that took on the doing-business name of Dividend Restaurant Group earlier this fall, in an interview.
The company, which now has 82 Macaroni Grill units and 13 Sullivan’s, was first created when Mac Acquisition LLC, the parent to Macaroni Grill, emerged in February 2018 from Chapter 11 bankruptcy protection.
In September 2018, it acquired the then-14-unit Sullivan’s from Del Frisco’s Restaurant Group Inc. in a $32 million deal. Del Frisco’s, in turn, was taken private by equity firm L Catterton this past summer.
Machado, who also serves as a senior managing director at Mackinac Partners, talked with Nation’s Restaurant News about how the company has absorbed Sullivan’s and how he approaches team development:
You are a little more than a year into your acquisition of the Sullivan’s Steakhouse brand. How has that gone?
It has been an incredible acquisition for us. It has exceeded expectations. It has been able to give us the ability to leverage the strength of the platform that we spent the last two years building. And it created opportunities for the team, which is something that was important to me from a leadership standpoint from Day One.
You’ve talked about developing a platform for a restaurant company. What has that entailed?
For us, it’s systems, people and process. We’ve implemented industry-leading systems across the board. We’re invested a significant amount of capital in the systems, because we want those to be the core pillar of the platform. And then we’ve invested a lot time, energy, effort and capital in building out what we believe is an industry-leading team. That is constantly evolving.
How important is internal team development for your company?
In the competitive set we live in everyday, if you don’t continue to grow and don’t continue to provide opportunities for that team for career development and upward mobility, you will eventually lose that team.
How have you designed your platform to accommodate varied concepts?
Sullivan’s is fine dining and steakhouse. Mac Grill is polished casual and Italian. But they both have a common trait: They both have unique attributes to the brand; they are not generic in any way. They have their place in the market, and we have been able to home in on that. … what makes the brand special. That’s the process we go through on any turnaround.
What has been the most rewarding part of having Sullivan’s in the mix?
Hands down, it’s the opportunity it has created for our team. It has created opportunities for key members of our team to move to the other brand and step up and take on larger roles and greater responsibility.
How have you been able to improve retention?
It boils down to what’s most important to our key members. In our opinion, it’s financial stability and advancement. It’s career development and work culture.
How did you approach financial stability and advancement?
We implemented at the beginning of the year a management incentive plan that’s unique in the industry. It creates alignment with everyone from an assistant manager on up to senior leadership. It makes sure the team members that create the value benefit from the upside of the value that has been created. We saw 90% of all manager participate in the plan.
And in career development?
We spend a lot of time working on the development of our managers into business leaders. … We treat them as CEOs of their business. We train them and walk them through everything about the financials of the business, what’s important from a leadership standpoint and how to develop their teams internally.
And culture?
Culture is something a lot of people talk about, but I think it starts from the top. You have to lead by example. The one thing that is most difficult about culture is cascading it throughout the organization.
A lot of restaurant brands are wrestling with how to approach third-party delivery and other changes in the industry. What do you see as the biggest challenge ahead?
I think the biggest challenge is being nimble and constantly adapting to a changing environment.
What’s next for Dividend Restaurant Group?
We’re continuing to down the path we set out two years ago. That path is to continue to grow and to eye opportunities to help us get bigger and stronger. … We could absorb another transaction. That’s where I spend the majority of my time.
Contact Ron Ruggless at [email protected]
Follow him on Twitter: @RonRuggless
