Building A Better Burger How Dave Thomas turned a local restaurant into a very beefy business.

Dave thomas' face is everywhere: billboards, TV commercials,life-sized posters in the window of every Wendy's restaurant.It's the face that launched a hamburger chain, and built itinto a $4.2 million dollar empire.

With more than 4,500 restaurants in the United States and 34 othercountries, Wendy's repeatedly beats McDonald's as thenumber one burger joint in an annual survey by Restaurant &Institutions magazine. Burger aficionados consistently rateWendy's high on the quality scale. And it's all due toThomas' hard work, dedication and commitment to building abetter restaurant.

"In 1940, at the age of eight, I dreamed that one day I wouldown the best restaurant in the world. All of the customers wouldlove my food, and all of my employees would do everything they weresupposed to do. But most important, everyone would think I was agood boss, and every day when I walked into the restaurant, peoplewould be glad to see me," writes Thomas on the opening page ofhis autobiography, Dave's Way (Berkley Books).

Thomas candidly admits that achieving that dream was a study insurvival. "Early on, I realized there is no easy way,"says Thomas. "If you want something, you have to go out andwork for it. The idea is to do something you love."

Ask him what it takes to be a successful entrepreneur, and Thomastells you straight out that anyone can be successful if he or sheis dedicated to a service or product, has strong convictions and iswilling to work hard to build experience. As the saying goes,however, it's easier said than done.

In The Beginning

Thomas was adopted by Rex and Olivia Thomas when he was six weeksold and christened Rex David Thomas. His adoptive mother died whenhe was five, and after his father divorced his second wife, Thomasbegan to get up close and personal with the restaurantbusiness.

"We started going to restaurants for our meals," saysThomas. "It was then that I decided I wanted to own my ownrestaurant because I liked to eat, and I just thought restaurantswere really neat, exciting places. By the age of nine, I had becomea real expert on restaurants. I knew what customers expected and Iknew what kind of service and quality was acceptable. I overheardcomplaints and compliments and I soaked it all in."

Thomas spent his teen years learning the grunt side of therestaurant business. When he was 15, his family moved to FortWayne, Indiana, where he landed a job as a busboy at the HobbyHouse Restaurant. "By then, I was a veteran restaurantworker," Thomas chuckles.

At 18, he made another major career move: He enlisted in the armyand enrolled in the cook and baker school to learn the skills of amaster baker, as well as the rudiments of managing a mess hall thatserved 2,000 meals a day. He learned to negotiate with vendors andbuy in quantity.

"It turned out to be a great learning experience," saysThomas. "I learned how to be an entrepreneur and it didn'tcost me anything. It was like running my own business, without anyof the risks."

When he finished his three-year army stint, he got back his job asa short order cook at the Hobby House. There he met and fell inlove with a pretty waitress named Lorraine Buskirk. They married in1954, when Thomas was 22 and Lorraine 19.

Kentucky Fried Marketing

Marriage only made Thomas more determined about building hiscareer. It was 1956 when his boss, Phil Clauss, opened a barbecuerestaurant called the Ranch House. There, Thomas met the legendarychicken baron, Harland Sanders, better known as "theColonel," the founder of the Kentucky Fried Chicken (KFC)chain.

"The Colonel was traveling nationwide, promoting his new friedchicken franchise," says Thomas. "He turned out to be aman who had a profound influence on my career."

Seeing an incredible opportunity, Clauss bought a KFC franchise. Hesold the chicken through the Ranch House and Hobby House, andThomas, now Clauss' right-hand man, learned the chickenbusiness.

In 1962, Thomas got an opportunity to prove himself. Clauss madethe mistake of buying four failing KFC carry-out locations inColumbus. At his wit's end about the crumbling businesses, hemade Thomas an enticing business offer: If Thomas could turn aroundthe stores, pay off a $250,000 debt and turn a profit, Clauss wouldgive him 40 percent of the Columbus franchises. "The Colonelwarned me that the stores were almost bankrupt," says Thomas,"but I figured I had nothing to lose. I knew it would bedifficult, but with four kids to support on a salary of $135 aweek, I'd have been foolish not to try." Thomas studiedthe ailing restaurants and found a solution.

"There were too many items on the menu, many of which took along time to prepare," he says. So he trimmed down the100-plus items to a manageable staple of chicken and salads. Topromote the restaurants, he bartered buckets of chicken for TV airtime. Business turned around practically overnight. In March 1967,the $250,000 debt was paid off. He and Clauss opened a fifthlocation in Columbus, before selling their stores back to theparent company in 1968. Thomas was then a millionaire at the age of35.

Convictions About Hamburgers

By 1969, Thomas had a clear vision of the kind of business heintended to build. Hamburgers were, and still are, Thomas'favorite meal, and he knew he could beat his competitors byoffering a better burger.

"Some people have convictions about the making of fine silver.Others have convictions about how to run universities. I hadconvictions about hamburgers that came from my experiences as akid," Thomas says.

"My burgers were going to be hot off the grill. No hamburgerwould be put on a bun until we had an order. Customers could choosetheir own toppings, rather than buy burgers with condiments alreadysitting on them." The burger meister also intended to offermeatier burgers containing less fat.

In 1969, Thomas finally made the big move and opened Wendy'sOld Fashioned Hamburger Restaurant in downtown Columbus at a costof less than $90,000. The restaurant's logo featured a cutelittle pigtailed girl who was based on Thomas' eight-year olddaughter, Melinda Lou, nicknamed Wendy.

Thomas' first Wendy's did well immediately, earning$300,000 in its first year, but he was determined to movecautiously. "I had no grand five-year plan," he says."It was more like, 'Let's get on our feet beforebarreling ahead.' I wanted to make sure we had a viable productthat would make money."

Early on, he learned to surround himself with the best people hecould find. He hired people who loved the restaurant business asmuch as he did. It didn't hurt if they were passionate abouthamburgers, either.

"If you hope to grow your business, you've got to learn totrust and support people," says Thomas. "If theydon't perform, you go out and find people who can get the jobdone." He also kept a watchful eye on the competition, neversecond-guessing or underestimating them. "I looked at thecompetition and tried to figure out what they were doing better sowe could improve our operations."

Thomas decided to test the franchising waters cautiously. He wantedto be certain that franchising worked, and that his concept couldeasily be franchised. He also wanted franchisees who understood therestaurant business and would be successful. If they did well,Thomas would do well and the Wendy's image would bestrengthened. By his second year in business, potential franchiseeswere beating down his door. Four years after launching his company,Thomas sold his first franchise.

In 1970, Thomas opened another restaurant in Columbus, and salesreached above $600,000. By the end of 1974, total restaurant saleshit nearly $25 million. There were 100 Wendy's restaurants in1975. About a decade later, Thomas celebrated the opening of his3,000th restaurant in the French Quarter of New Orleans.

It's not that Thomas was lucky; luck played no part in hisextraordinary ascension to entrepreneurial superstardom. Thomascredits listening and observing-and determination, dedicationand hard work-for his success, skills he began honing as ateenager. Everyone he worked for served as his teacher. Theirsuccesses and failures taught young Thomas everything he needed toknow about running a successful business.

"I learned to look at everyone's business style andphilosophy," says Thomas. "I picked and chose compatibleideas and rejected the others. There are a lot of ways to getdowntown and they're all right. It's just a question ofpicking the best path for you. It's the same way inbusiness."

Well Done

In the mid-1980s, Thomas stepped down into an advisory role andtook the titles of senior chairman of the board and founder. Hehired an experienced team of managers to run the company on aday-to-day basis, most of them former franchise owners withimpressive credentials in the food business.

The "Where's the Beef" advertising campaign, starringretired Chicago manicurist Clara Peller, exploded onto the scene ofthe 1984 "Burger Wars," between Burger King andMcDonald's, and stole the spotlight from Thomas' largercompetitors. Some groups raised a fuss, saying the ads made fun ofseniors, but by the end of its second wave, the campaign hadincreased public awareness of the company from 37 to 60percent.

In 1989, Thomas was brought back into the fray to act as thecompany's spokesperson, a job he enjoys almost as much as heenjoyed building his company. At 63, he is on the move constantly,making public appearances and doing TV spots. In the last sixyears, he's made over 383 TV ads. This year, he's scheduledto make 90 commercials. Put it all together, and Thomas is on theroad almost 200 days a year.

When Thomas is trying to do a thousand things at once, he doesexactly what he's been doing for 25 years: He finds the nearestWendy's and has a double cheeseburger with mustard, pickles andonions, a bowl of chili and an order of french fries, and thenwashes it down with a large Frosty. After that he's charged andready to go.


Bob Weinstein is a frequent contributor to nationalmagazines.