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For Oden and 260,000-odd independent restaurateurs across the U.S. that experience the same hidden pains, there just might be an antidote on the scene. Tucked inconspicuously beside railroad tracks on Chicago's North Side is a budding Internet business angling to be the restaurant industry's secret sauce. Not coincidentally called TheSauce.com, the site provides a variety of business utensils that independent restaurant owners need but often don't have the time or knowhow to master. TheSauce helps managers find and train employees, retain services and equipment, find ideas for menus, seek operations advice, complete administrative and financial forms, and of course, buy food -- and it's all free. "Our whole credo is to eighty-six the headaches," says Peer H. Munck, CEO of TheSauce.com. "We want to make sure that restaurateurs have the time to do what they really love to do -- cook." "OFF A CLIFF." The business model for TheSauce first simmered into place last spring. Executives at leveraged-buyout firm Clayton, Dubilier & Rice and their consultants brainstormed about how to build a complement to CD&R's food distributor company, Alliant Foodservice. Munck, a digital strategy expert for consultant Diamond Technology Partners at the time, was pushing CD&R to spin off a new business that could serve the $376 billion restaurant industry's "small guys" -- independent eateries. Once the due diligence was done by summer and CD&R had agreed to pour $25 million into the venture, Munck was asked to run the business. That meant giving up a plum consulting job and essentially "jumping off a cliff," Munck says. He decided to take the dive. Since launching in October, Munck has built a staff of 75 employees. The idea was to create the quintessential Internet culture. Employees come and go as they please -- usually working long hours. The work space is completely open with few walled offices or doors. Staffers bring their dogs to work and take the obligatory foosball breaks. On Friday nights they hold a happy hour complete with live music performed on keyboards by Munck and other staffers. Appropriately, there's a kitchen in the office where they cook different dishes on designated days. And workers, who all own company shares, are allowed to grab a beer whenever they like. "It's their company," Munck says. "I trust them to work hard." SPOTTY SERVICE. Hard work during its first six months has helped TheSauce amass 1,669 registered restaurant users, changing the economics of the industry. Independents have historically had a hard time getting major food distributors like Alliant and Sysco to pass along rates as attractive as the big chain restaurants receive. But with the aggregate buying power of 1,669 restaurants behind it, TheSauce has managed to sign eight food suppliers, including Alliant, that will compete for the restaurants' orders. "That's big," Munck says. Most of the restaurant customers are based in Los Angeles, the site's first market. But by this summer, Munck expects to enter two more cities -- Chicago and San Francisco. And by 2003, he hopes to be serving restaurants in the nation's 50 top markets. While promising, TheSauce remains a spotty service for the time being. The most sought-after feature, placing orders for food, has not been launched commercially. Munck says TheSauce will start taking orders sometime in June, but he's proceeding with caution. Why the baby steps? In December, he asked 10 customers to test the site for food ordering, and they "threw up all over it," he admits. TheSauce had promoted itself as easy-to-use, but the beta testers said it was slow and cumbersome. That's why Munck has gone back to the drawing board and rebuilt the service so it doesn't "require any heavy lifting," he says. Restaurant owners typically spend several costly hours ordering food. To place orders, they sit down with or talk on the phone with salespeople representing the distributors. The process of placing thousands of dollars of food orders per week is so time-consuming that restaurateurs often forgo checking prices closely. For example, Roy A. Schneider performs every conceivable task -- cooking, washing dishes, and keeping the books -- at Sabroso, the Mexican restaurant he owns in L.A.'s San Fernando Valley. "When you have to do everything," he says, "your eyes tend to go away from price." HANDHELD AIDS. Although Schneider has yet to place an order with TheSauce, he's looking forward to the time and money it promises to save. Right now, the site is built to let users simply click on the food they want to order -- ground beef or salmon fillets -- and the site spits back the best price from a list of suppliers. The restaurant owner doesn't have to spend a minute on the phone doing price comparisons. Schneider buys 15 cases of ranchero meat a week at anywhere from $1.89 to $2.59 per pound. If TheSauce can deliver the best deal with no hassle, Schneider will be sold. "That's the big benefit," he says. Munck intends to use the latest technology on the market to bring even more benefits to his customers. He says that this summer, customers will have the option of using wireless handheld gadgets that look like souped-up Palm personal digital assistants to scan and order food. They'll simply point the device at a case of veggies, bread, or whatever they want to order. Then, they'll press a button to make the order. Even without this fancy high-tech gear, customers are finding TheSauce a useful aid. The Corn Dance Café's Oden constantly uses TheSauce's business tools, online solutions for everything from payroll processing and inventory management to property insurance and job descriptions. The forms come ready-made, and they're nirvana for restaurateurs who don't necessarily feel comfortable with what Oden calls "the nasty little details" of the business side of owning a restaurant. "We're creative souls, and it's hard to find the time and the will to take care of the business aspect of the restaurant," says Oden, who caught the restaurant bug as a soda jerk on the fountain at Van's Pig Stand in Shannee, Okla. TheSauce "allows us to follow our passion, slinging together some wonderful dish in the kitchen." From his Chicago hideaway, Munck is smiling. Simply slinging is all he wants his customers to worry about. Crockett covers technology from Chicago. |
