The interview below is part of a new series from McGuireWoods that features interviews with professionals in the food and beverage industry. To recommend a professional or company for a future interview, please email Brad Austin or Jim Neale.
Larry Reinstein is an industry veteran with a proven track record in growing successful brands. As president of LJR Hospitality Ventures, Reinstein offers strategic counsel to his clients, utilizing over 30 years of experience as a restaurant company owner, professional manager and industry consultant.
LJR Hospitality Ventures works with restaurant owners and operators, from fast-casual to QSR to casual dining to identify opportunities and execute solutions to create profitable business strategies.
Prior to this current role, Reinstein held the position of president of Salsarita’s Fresh Cantina, an 80-unit franchised fast-casual chain, where he led the company in transforming the brand in order to effectively compete in the crowded Mexican category. Over a two-year period, Reinstein grew same store sales over 11 percent and increased company-owned restaurant profitability by six percentage points over the same period.
Preceding his tenure at Salsarita’s, Reinstein founded and held the position of president and CEO for Fresh Concepts, the company that owned and operated a number of brands, including Fresh City, Souper Salad, Planet Coffee, Fresh Concepts Café, Pistachio’s and Church Street Bar and Grill, among others. During this time, Reinstein led the company of 500 employees to generate $35 million in system-wide sales. Reinstein obtained a BS with distinction from Cornell University’s School of Hotel Administration. He is the recipient of the Cornell Hospitality Innovator Award and the Best of the Best Food and Beverage Award from the Young Presidents Organization. He is the past chair of the National Restaurant Association Fast Casual Industry Council.
Q: Before we get into the current state of the industry, what attracted to you to food and beverage? What is your role in the industry and how has it changed over the years?
Larry Reinstein: My family owned franchised restaurants when I was young and I was always there helping out. By the time I was 13, I knew that I wanted to spend my career in the business. I was determined to learn as much as I could through my education and work experiences. After college, I went on to found and operate a multiconcept restaurant company, running a national franchise chain, and now am a consultant who evaluates and advises emerging and challenged companies. I also enjoy coaching CEOs and founders, helping them achieve the success they deserve.
Q: What are you seeing people do that is working (or not working) to address challenges in the industry?
LR: I see strong leaders developing well-thought-out short-term plans and being able to adapt these plans quickly to a constantly changing environment. They are also showing empathy and communicating well with their lenders, landlords, suppliers, investors and, most of all, their teams. The level of innovation in providing new services to guests and charitable commitment to the community has been sensational. The most successful people have focused on being extremely objective in a highly emotional time.
Q: What are some recent opportunities you have seen and what makes them attractive?
LR: Restaurant companies are now focused more clearly on understanding their business and where profitability comes from. Reduced menu size, new meal periods, new technologies, more efficient supply chain and new labor models will follow. Restaurant companies that previously did little or no off-premise sales are capturing new business that will become a significant revenue opportunity moving forward. Locations that have been marginally profitable in the past will probably be eliminated, which will right-size the competitive marketplace and increase overall sales and profitability.
Q: What does the future look like for restaurants?
LR: Quick-service restaurants with drive-thru and delivery will be well-positioned for success. Full-service and many fast-casual concepts will need to pivot significantly in order to be successful. During the transitional new normal, value will be very important to many consumers, as will frictionless experiences … in how they order, pay and utilize restaurant facilities. Those that can provide consistent differentiated experiences will be rewarded with significant market share and will have access to the many restaurant locations that do not survive. Well-capitalized private equity companies and family offices will have opportunities to acquire restaurant brands at a significantly reduced price. Innovative entrepreneurs who can access capital will have opportunities to open concepts at a greatly reduced cost with more favorable rental agreements.
Q: What have you been doing to unwind and get away from it all during these last few weeks?
LR: Other than working out every day, probably not enough. I seem to be working seven days a week, helping clients and friends as well as challenging myself to learn as much as I can about what’s happening in the world today and tomorrow and how it’s going to affect the restaurant business.