Food for thought

Winner, Real Estate and Hospitality

When Sunil Dharod used his savings from working three jobs to purchase his first Jack-In-The-Box restaurant franchise, he became the youngest franchisee in the country. Dharod was driven to succeed, and becoming a business owner in 1986 was a world away from the days of his youth, when he delivered milk door-to-door for 70 cents a month in Bombay, India.

Over the next five years, Dharod bought five additional restaurants in California and began to master his ability to apply his own brand of entrepreneurship to creating money-making ventures in the restaurant industry.

In 1992, Dharod sold his restaurants and moved to Dallas. There, he bought 12 struggling Dallas-area Burger Kings, and within a year, sales and margins at those restaurants increased to the point where all of his locations were performing well above comparable stores nationally.

In 2008, Dharod took on a new challenge by acquiring all 37 Applebee’s stores in North Texas that the company had deemed part of its “least profitable restaurants.” As with his Burger Kings, within a year, Dharod turned the 37 stores into national leaders in comparable sales by seizing the opportunity for improvement.

Dharod attributes his business successes — which, including the 37 Applebee’s restaurants, is composed of 3,000 employees, 18 Burger Kings and a portfolio of commercial real estate properties such as shopping centers and office buildings — to three key factors: innovation, creativity and competitive differentiation.

He innovated by converting all of his Burger Kings into 24-hour operations, becoming the first franchisee in the nation to do so. He also achieved economies of scale by having the night crew handle cleanup and food prep for the following day. This led to Dharod’s franchises having the lowest food and labor costs in the entire Burger King system.

He created a competitive differentiation by working to create repeat customers and the right pricing for each item. At Burger King, he created a consistent value menu while increasing the price of combination meals. At Applebee’s, he used creative marketing to energize the staff around the company’s branding theme as a neighborhood restaurant. This led to his store achieving top franchisee status in comparable sales increases.

How to reach: Dharod Inc., www.dharodinc.com