Grilled In a Minute: Rich Melman
Julie Mautner / August 29th, 2012
After 40 years in the restaurant business, Richard Melman, founder and chairman of Lettuce Entertain You Enterprises, is used to the heat of the frying pan and the fire. Julie Mautner digs in to see what keeps this kitchen veteran ticking.
Richard Melman is founder and chairman of Lettuce Entertain You Enterprises (LEYE), the Chicago-based company that owns 90 restaurants nationwide.
The restaurant business has been Melman’s life work, beginning with his early days in a family-owned restaurant, and later as a teenager working in fast-food eateries, at a soda fountain, and selling restaurant supplies. After realizing he wasn’t cut out for college and failing to convince his father that he should be made a partner in the family business, Melman met Jerry A. Orzoff, who quickly became his best friend. In 1971, Melman and Orzoff opened R.J. Grunts, which, after a slow start, blossomed into one of the hottest restaurants in Chicago. At R.J. Grunts, food was presented with a whimsical sense of humor, and Grunts was a clear forerunner in the trend toward dining out as entertainment that swept the country in the early 1970s.
Melman and Orzoff continued to develop restaurants together until Orzoff’s death in 1981. Through this relationship, Melman formulated a philosophy based on the importance of partners, of developing restaurants together, of sharing responsibilities and profits. Today, Melman has nearly 60 working partners, most of whom have been with the company for years.
Melman’s reputation for imaginative concepts and operational expertise go hand in hand with the company’s focus on the hiring, training, development, and promotion of its employees. He places enormous value on the approximately 6,000 people who work for LEYE and feels tremendous responsibility for their continued success. He says he's never worried about being the biggest, the richest, or the most well-known restaurateur—but rather on being the best he can be.
Melman’s three children—sons R.J. and Jerrod and daughter Molly—are all fully involved in the family business, ensuring the company’s future success for years to come. In 2008, R.J. and Jerrod opened the Chicago restaurant HUB 51 and, the following year, introduced the casual eatery M Street Kitchen in Santa Monica, California. In 2011 they opened Paris Club in Chicago and an artisan pizzeria, Stella Rossa Pizza Bar, in Santa Monica. In February 2012 the siblings—along with Bill and Giuliana Rancic and chef/partner Doug Psaltis—launched RPM Italian in Chicago. At press time, they were set to open a country bar called Bub City and a tiki bar concept in Chicago (both in late summer or fall 2012), which will be followed by RPM Steak in early 2013.
Richard resides in the suburbs of Chicago with his wife, Martha. They have been married for 36 years.
Forty-two years! Don’t you ever just want to say “basta!?” How do you keep energy and creativity alive?
Success has given me energy, and that’s my criteria: If I ever feel it’s a burden to continue, I’ll stop. I’m still so enthusiastic about what I do, and I think I’ve got some of the best ideas now that I’ve ever had. We’ve got six or seven projects in the planning stages. I see holes in the market. I feel really good about what’s going on.
What’s the most significant change you’ve seen in the biz in the years you’ve been at it?
Communication. When we opened our first restaurant, it took forever for people to find out about it. When we opened RPM Italian in Chicago in February, the press was all over it, long before it opened. Communication has sped up and gotten much more sophisticated. I was out with two of my kids one night, and they must have taken 15 reservations. When they opened their first restaurant four years ago, I said “You didn’t send any invites to the party.” They said, “We did it all by evite.” And it was shocking how many people showed up!
Most important thing experience has taught you?
Young restaurateurs rarely have balance…balance takes time. Early on, I wanted to pursue all the ideas I had been storing up for years…but I didn’t know a thing about making money! And I see that with young restaurateurs a lot. To balance great food, creativity, running the restaurant, motivating people, and making a profit…well, generally you see someone excel at one of those but rarely at all of them. It’s easy to hire a great designer, easy to hire good people, easy to train people in the basics of service...easy to hire a good chef. The problem is, can you make enough money to justify what you’ve spent? In baseball, a young pitcher can throw hard, but he’s wild and has no control. As time goes on, he loses strength and speed. But once he’s learned the nuances—how to keep the batter off balance—he’s more effective. You need mistakes and heartaches to mature as a businessman.
What’s the worst advice you ever received?
To not pursue my dream. When I was young, I worked for lots of different restaurants, and nobody would listen to me. Very discouraging! That, as much as anything else, made me want to go into business for myself. In 1969, I was working at Robby’s in Chicago when I told my family I wanted to open my own place. They thought I was crazy. They said, “But you have such a good job!” When I told my boss I wanted to quit and go out on my own, he gave me a raise. A few months later, I tried to quit again—and he gave me another raise. That’s when I realized it wasn’t about money. I had all these ideas burning inside of me and just had to give it a shot.
So tell us about the worst day of your career, ever.
We opened R.J. Grunts in 1971 and every idea I ever had went into it. It was really a breakthrough restaurant in those days…but nobody came. The first week we did $2,100 of business; our payroll was $2,000. That first month, I never saw more than 20 people in the restaurant at a time…and we had seats for 100. I was losing my ass. I kept trying to improve things—tweaking the barbecue sandwich, making the staff look sharper—little things I thought would make a difference. Around the ninth or 10th week, we were running out of money. I’d always been realistic but I couldn’t kid myself anymore. So I went home, laid down, and said to myself, “That’s it. I failed. It’s not working.” I decided I’d have to go out and find two jobs—one to pay off the debt and one to exist on. That was the most devastating day of my career. I’ve always been a competitor, and I absolutely hated to lose. I never felt worse than I did that Wednesday—that was my great depression. But I took a shower and went back to work.
Two days later, I walked into the restaurant at 7 p.m., and it was full. With people waiting in line. After that, it never slowed down again. How I went from the worst day ever to the best day in just two days, who knows?
To this day, I’d work seven days a week, 15 hours a day, to never again feel the way I did that Wednesday. My fear of failure definitely keeps it all alive. The day I no longer have that fear—and work my hardest because of it—will be the day that I retire.
I worry about my kids because they’ve opened three smashing successes. I’m not sure success is the best teacher.
Did you have a mentor? How did they help and nurture your career?
I had a number of mentors. My first was my dad. You learn from your parents by what they can do and can’t do, and I learned both ways from him. The second was my best friend, Jerry Orzoff. I learned a tremendous amount from him. He was in real estate at the time, and someone said to him, “Rich takes care of the restaurants, but what do you do?” He said, “I take care of Rich.”
Psychologically, he was so aware…and a much better businessman than I. The third was the landlord at our second restaurant. I thought he was the toughest, meanest guy in the world but we became very close. And up until the end, we had lunch together once or twice a year. He’d say things like, “You know what you’re good at…so why try anything else?”
Speaking of nurturing, Lettuce has long been seen as a great place for driven, creative, entrepreneurial people to work at…a company that offers enormous opportunities. (I love how you list job openings restaurant by restaurant on your website.)
I’ll use a baseball analogy: We have a great farm system! We grow people, and I take great pride in that. We have some of the best young food talent here right now that I’ve ever been associated with. But sometimes I feel they don’t get the recognition that other people do, because they’re part of this big company. Doug Psaltis, for one, is going to be a star—no doubt in my mind. We just did RPM together—Doug is a partner—and it’s a smashing success. Doug and my kids are working on three other projects as well. Another rising star, also a partner, is Jeff Mahin. Jeff’s doing terrific things, such as Stella Rossa Pizza Bar in Santa Monica and Do-Rite Donuts & Coffee here in Chicago. And there’s more to come. But Doug and Jeff are just two of many great young people here at Lettuce—people the culinary world will definitely know about in the next couple of years.
Surely you’ve been asked many times to write a memoir. Why hasn’t it happened?
I live in the moment and don’t reflect a lot. And I’m still learning and doing so much that it would be obsolete by the time I finish. For the past few years, the kids in our company have been asking me to write it, and maybe one day I will…but not now. That said, I am working on something very simple, with a lot of my philosophies in it.
What one thing would you most like to change about yourself?
I wish I hadn’t lost my athletic ability.
And the thing your wife would most like to change about you?
My wife is really bright, and I think she’d say I’m one-dimensional. She wishes that I had more interests, such as travel. But I just don’t have that curiosity.
Speaking of travel, where would you go now to eat…and why?
The kids at Lettuce sometimes give me a list of 10 new places in Chicago, and I’ll go out and hit them all in a week or two. I’m always so far behind on Chicago, that’s where I’d go first to eat.
What’s the best U.S. food city right now?
Now and always: New York City. It’s never been a contest. There’s no city—not Los Angeles, not San Francisco, not Chicago—that comes close. New York is the best.
And what city or country would you next want to visit, for any reason?
I really like London. I like that they speak English, and the restaurant food is very impressive.
What’s your idea of late night snacking bliss?
Lousy coffee cake or babka or something like that.
And what do you do for fun?
At one time it was athletics. Now I just like to be with my family and friends. I don’t need much more than a nice dinner out, a movie—simple stuff.
What would you ask your mom to cook for you if you went to her house this weekend?
She had an Italian neighbour, Anna Rose, who made this amazing meat sauce. So when I’d visit, my mom would always make spaghetti and meat sauce. I loved it.
You’re a big believer in therapy, and you’ll pay for employees who want it. What did your own therapy do for you, and why do you feel it’s so important?
Getting to know myself through therapy was one of the most important things I’ve ever done. To be a leader you don’t have to be the brightest person…but you have to understand the people you work with. You have to know how to motivate and to develop people, how to make them feel successful. And that starts with knowing yourself. You can’t be the type of leader I want our people to be unless you’ve worked through a lot of things yourself.
Restaurateurs come to Chicago from all over the world to check out your restaurants, study your methods, look for trends, and copy you. In fact, it’s said that you’re the most copied guy in the industry. Any thoughts on that?
It’s hard for me to say whether that’s true or not. Occasionally people call me and want to come see me, wanting advice. I like young entrepreneurs and restaurateurs, and I’m happy to help. But I don’t think about whether people are looking to copy us.
And where do you find your own inspiration?
Many years ago, I was out with friends for dinner, and when it was time for dessert, no one ordered anything. Then someone said, “Well, I’d like just a bite of something,” and everyone agreed. So we ordered one dessert and seven forks. That resonated with me and I developed mini desserts—the world’s smallest hot fudge sundae—that sort of thing. That was 1984, and now you see mini desserts everywhere. If you just pay attention, you’ll get your inspiration. I look at science, fashion, who the President is—all of it. I read a lot, I listen a lot. For example, when the cholesterol drug Lipitor first came out, I knew right away we’d see more beef consumption, more steakhouses. People think, “Now that there’s a pill to hold my cholesterol down, I’ll have a steak!” I’m always looking for holes in the market, things we can do differently or better. My problem has never been a shortage of ideas. My problem is finding the time to pursue them. Every year I’ll open three or four new restaurants but have seven or eight ideas.
For someone who dreams of a career like yours, what’s the very best advice you can offer?
Quit dreaming and start doing.
OK, I have to ask it. Any thoughts on retirement?
Maybe I’ll work less but no, no plans to retire…I love what I do. I retired once, at age 30. My partner, Jerry, had this premonition that he’d die young, and after we paid off our first restaurant, he said, “Rich, your goal was to make $15,000 a year, and you’ve done that. What more do you need? Let’s go to California and have fun.” So I went for four months, and it drove me crazy. My life is intertwined with business, and it keeps my mind active.
You built your company so lovingly, with such passion and hard work. Do you worry what will happen to Lettuce when you’re gone?
When we celebrated our 40th anniversary at R.J. Grunts—we turned 41 on June 10 of this year—someone took a picture of me, my wife, and our kids. I look at that photo and I see the future. We’ve put together an amazing group of young people here, and I don’t mean just my kids…I mean the whole group. My goal, my dream, is that Lettuce will be around 40 more years. And when I look at that picture, I see the future. It feels very, very positive.