Broadening Business Horizons In A Saturated Market
I knew that one day I would share my passion for Italian food with the world. I remember shaping cannoli around the handle of a broomstick with my grandmother when I was 12 in our New Jersey kitchen. By the time I was 18, I had earned the Chef distinction. I founded and currently own two restaurant concepts: Russo’s New York Pizzeria and Russo’s Coal-Fired Italian Kitchen. The first Russo’s New York Pizzeria opened in Houston in 1992, and there are now more than 40 locations throughout the U.S. There are four open in the UAE, and there is currently an agreement inked with a local UAE franchisee to open 24 additional outlets.
I have been asked numerous times why I decided to take Russo’s overseas to the Middle East. My response, “Why not?” We have the best tasting New York-style pizza in the fast casual category and the rest of our menu is filled with culinary delights. Plus, the Russo’s experience is like no other. The UAE appreciates premium brands, and Russo’s is the perfect fit. The pizza industry in the United States is saturated; even though there are specialties that help differentiate brands, like thin crust or deep dish, U.S. pizza-eaters still have many options when deciding where to grab their next pie. We separate our brands as authentic New York pizzerias. When I began weighing the idea of offering franchising opportunities outside of the U.S., I had multiple factors to consider.
1. Would the restaurant concepts work outside the United States?
Yes. People love pizza, and (good) pizza is not as easy to find in many places outside the United States. During my international travels, I’ve tried numerous different versions of pizza, some are good and others resemble nothing close to pizza. The UAE market is welcoming to New York-style pizza concepts. When the home market is saturated, it makes sense to broaden horizons. Also, the fast casual concepts of Russo’s New York Pizzeria and Russo’s Coal-Fired Italian Kitchen are easy to replicate elsewhere. Many other fast casual American restaurants have seen positive results when taking business overseas.
2. Would changes need to be made?
The whole world doesn’t enjoy the same foods and flavors. The menu we offer in the United States would not be completely compatible with the palate of Middle East diners. Developing in a new market would require us to make alterations to the menus and service. Figuring out exactly what would need to be changed required thorough research -unlike our locations in the U.S., our UAE outlets don’t serve pork or alcohol- but they do offer options such as eggplant pizza and Mediterranean dips, and other flavors comforting and familiar to our Middle East guests. Making small changes to our menu didn’t alter the essence of Russo’s. We made sure that each dish would be crafted with the same attention to freshness and taste. Instead, the changes allowed us to appeal to the market. Before brands take a business overseas, they must consider whether or not they are willing to adapt.
3. What are the legal policies? More importantly, would the cost and hassle be worth it?
When thinking of developing in a new market, it is important to be well-informed about business policies and regulations. I was not familiar with restaurant business protocol in the UAE, so I sought help from local experts. Teaming up with experienced business leaders from the area proved to be a game changer. We quickly learned exactly what it would take to get the concepts approved and cleared.
4. Once everything is approved, will it be possible to get the restaurants up and running smoothly?
I’ve participated in each of our locations’ training sessions and openings, and not only do I enjoy being involved, but it allows me to share my experience and give feedback on how the stores will operate. When it became time to select staff for the first UAE location, we realized training the new employees would be difficult. There was no example for them to follow. Plus, there was a language barrier. Instead of trying to use training videos, we brought all the new management staff to the United States for training. This allowed them to see how Russo’s New York Pizzeria and Russo’s Coal-Fired Italian Kitchen operate. We have a chef at one of our Houston stores who is fluent in Arabic and played a key role in the training process. Now, we have opened an office in Dubai that provides support and training to the locations. This additional system of support has led the UAE locations to greater success.
Training is a crucial step in the process of opening a business. From the beginning it is important to make sure staff objectives and standards are clearly defined, as these individuals will be the leaders of the restaurant. We had to go the extra step of providing training in the United States to ensure that quality training was given.
Business leaders seeking overseas growth opportunities should consider the steps that will need to be made in order for their business to operate smoothly. This could be anything from training to deciding on interior and kitchen design. These details might seem more minute, but they are just as critical as meeting country regulations. Each step of the development and opening processes need to be completed properly, otherwise, there is a higher chance of failure. Our restaurant concepts are strong and provide a different experience to diners in the UAE. We are willing to adapt our menu as long as we can maintain the essence of Russo’s. Our team is made up of talented and experienced business leaders who can help navigate UAE regulations and policies. We always go the extra step to ensure the highest restaurant operation standards are met.
When your home market is saturated, broadening your horizons to other markets makes sense. With specific growth markets targeted in the United States, we will continue to broaden our horizons in the UAE including Kuwait, Iran, Egypt, Lebanon, and as far away as China.
You do not have to halt your local growth initiatives altogether. Instead, you can simultaneously seek additional opportunities outside of your home market, allowing for all potential growth avenues to flourish.
Anthony Russo is the founder and CEO of Russo’s Restaurant Group, a restaurant ownership, operator and franchisor group doing business under Russo’s New York Pizzeria and Russo’s Coal Fired Italian Kitchen brands. Russo has grown his brands to more than 40 restaurant locations throughout the United States and in the UAE, and has plans to expand in existing markets and new markets.