Back in my twenties, I worked for a growing pizza chain, Little Caesar Enterprises, with a career that spanned nearly a decade. Little Caesars, at the time I joined was a 1,300-store, $700 million company and over the first five years of my stint there, had grown to 5,000 stores with sales close to $3 billion. Said another way, we opened up 1.5 stores/day for five straight years.
Mike & Marian Ilitch started the company in 1959, and their son Chris Ilitch, now manages the entire Ilitch Holdings enterprise that includes, among other things, the Detroit Red Wings and the Detroit Tigers. For three years of my career, I had the extraordinary privilege of working directly for Chris, and while we were both in our twenties at the time, Chris was wise beyond his years.
One of the philosophies of Chris that is forever embedded in my brain was the notion of spending money. I was responsible for the overall field marketing of the company and put together all of the field marketing budgets for the entire country. When I presented the marketing plans, he would always ask “If it were your money, would you spend it this way?”
I have always held that philosophy in mind on spending and investment decisions with my corporate positions and clearly at Gray Cat—because it IS my money! Imagine if our congressional leaders maintained the same type of philosophy in their spending decisions. My guess is that this country would not have a $15+ trillion deficit had each congressional member worked for the Ilitch family!
So, the next time you are looking to spend company money, ask yourself a few questions to measure your spending discipline:
When purchasing office supplies, do you pick the better products for business, but when you buy for your house, you search for savings?
How many times have you shopped your mobile phone contract at home (a lot) versus work (never)?
If asked to cut 10% from your OPEX budget, could you? Then, why do you need to be asked?
General & Administration:
If each out-of-store employee had to spend their own money on their travel, do you believe that they would schedule their trips smarter?
Do you stay at the Hyatt for business, but the Hampton for personal?
Do your eating habits change while you are on a business trip compared to at home?
Are you recommending a new store build because it is fun to work on, while skipping over the prudent, better ROI projects?
Do you seriously need to upgrade your computer every year?
When is the last time a post analysis was completed on a capital project?
If you owned a small retail store, would you advertise the same way as what you do for your large company?
If you sponsor a team, is it for the brand impact for your company or the free tickets?
How many low cost, high impact advertising programs have you identified in the last year?
It Is My Money: At Gray Cat, the buck stops with me. Decisions that are made on behalf of the company have a direct impact on my personal bottom line. The Gray Cat philosophy on spending is no different from what I learned at Little Caesars—albeit on a much, much smaller scale. I am constantly looking for ways to minimize expense, and it is one of the reasons that I have worked from my home office for eight years. In addition, I have invested in productivity tools —i.e., laptop, iPhone and iPad—that enable me to maintain productivity without a hitch while I travel. My investments in business development are low cost, high impact and the learning’s from Chris are clearly in action.
A disciplined spending and investment mindset can have a significant impact for a sole proprietor and an exponential influence for a large organization. So, whenever one is faced with the question of spending, ask the following: “If it were your money, would you make the investment?”
John Matthews is the founder and president of Gray Cat Enterprises Inc., a strategic planning and marketing services firm that specializes in helping businesses grow in the restaurant, convenience and general retail industries. With more than 20 years of senior-level experience in retail and a speaker at retail-group events throughout the U.S., Matthews has recently written two step-by-step manuals, Local Store Marketing Manual for Retailers and Grand Opening Manual for Retailers, which are available at www.graycatenterprises.com.