How To Build A Million-Dollar Business

Ruths Chris Steak House

Never Give Up

You wouldn't have bet the farm on Ruth Fertel in 1965. A divorced mom with a degree in chemistry and physics, she wasn't exactly a prime candidate for building an empire of upscale steakhouses.

Luckily, Fertel didn't realize her apparent limitations. "From the very first day, failure just didn't even enter my mind," says Fertel, 70, who now presides over 59 Ruth's Chris Steak Houses worldwide. Last year, sales at the Metairie, Louisiana-based company reached $176 million; this year, Fertel is forecasting sales of $205 million. Not a bad day's work for a woman who has successfully weathered skepticism, food fads, growing pains, natural disasters and every other standard-issue entrepreneurial challenge for more than 30 years.

Fertel bought New Orleans' Chris Steak House from the original "Mr. Chris" in 1965. "I had two teenage sons who needed to go to college,' she says. "I was working as a lab technician at Tulane University, and I needed to make more money." Fertel was skimming the classifieds when she came across an ad offering the locally known Chris Steak House for sale. "I thought `A steak house?' " she recalls, " `I can do that.' " So she mortgaged her home and used the $18,000 to buy the business.

Fertel worked hard. "I thought employees would respect me more if I worked right alongside them, so I did," she says. "The hours were terrible, but customers saw how hard I was working, and they wanted me to succeed."

But it wasn't just hard work that clinched Fertel's success. She had a knack for turning misfortune into good fortune. "A few months after I bought the restaurant, Hurricane Betsy came through New Orleans," Fertel recalls. "We had no electricity for a week, and I had a cooler full of steaks that would only last three or four days."

Instead of letting the food spoil, Fertel cooked up meals for the disaster workers and the disaster victims in a neighboring community. "Everyone was appreciative," says Fertel. "And many of them became loyal customers."

Ten years later, the restaurant burned down. "I called the bank crying, and it just so happened that a man who did construction was in the bank at the time I called," says Fertel. "He said he could get my new location open in a week--and he did."

The upshot? "The new restaurant had 160 seats, compared with 60 seats at the [old] place. People who were discouraged by our two-hour wait suddenly started showing up," Fertel says. "Business boomed again."

This, despite the fact Fertel had to scrap the restaurant's well-known name because her purchase agreement stipulated she could only call it "Chris Steak House" at the original location. The unusual new name, "Ruth's Chris Steak House," has been a blessing. "It's so recognizable," Fertel explains.

Ruth's Chris has become synonymous nationwide with gracious dining, impeccable service and tender, hearty beef that makes you feel well-nourished and invincible. Fertel started franchising Ruth's Chris in 1976, and now has 35 franchised locations. She has since stopped issuing new franchises but plans to continue expanding with company-owned locations.

"I've always tried to operate on the KISS principle--keep it simple, stupid," says Fertel. "The key is focus," even when that means ignoring froufrou food and dishing up meat and potatoes. And even when it means staring bad luck in the eye until, finally, it blinks.

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This article was originally published in the September 1997 print edition of Entrepreneur with the headline: How To Build A Million-Dollar Business.

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