A Look Inside the Company That Is Making $500 Million a Year Serving Italian Beef Sandwiches Made Famous by 'The Bear' Portillo's CEO Michael Osanloo shares his secret to keeping hungry customers coming back again and again. (Hint: It requires a lot of napkins.)
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Italian beef — it's not just a food item in Chicago. It is a cultural phenomenon, thanks, in part, to the Hulu show The Bear. This sandwich was originally invented in the early 1900s as a cost-saving measure to stretch supplies. But for Portillo's, one of America's highest-ranked fast-casual restaurants, it brings in over half a billion dollars in revenue.
So how is this company doing it? I visited Portillo's CEO Michael Osanloo to find out (and get a delicious lunch in the process.) Now, I've visited some incredible companies in my travels for The CEO Series, but this episode was, by far, the most mouth-watering. Below are some highlights of my conversation with the very energetic and funny Osanio, that have been edited for length and clarity. You can watch the full video above.
His philosophy for restaurant success
"I'm a simpleton when it comes to the restaurant business. My belief is that if you give people a great experience, they will come back. It's not more complicated than that. For those who don't know Portillo's, it's the best fast casual restaurant chain in America. If you come to Portillo's, you're going to ask for an Italian beef sandwich dipped and I advise you to get a lot of napkins. This is not a two or three-napkin kind of gig — this is like eight to 10 napkins. We have food that's heartwarming, it's belly-filling, and doesn't break your wallet."
His leadership style
"You've got to have a sense of responsibility. There are 8, 000 people who work at Portillo's whose livelihoods depend on me and my team's decision-making. And I take that responsibility incredibly seriously. I'm from an immigrant family. We immigrated from Iran when I was four years old. We lived in public housing in New Jersey. We didn't know anything. I learned to speak English before my parents did and so I became like a cultural ambassador In my household. I found at a very early age that I would take on more of a leadership role in our family and that has carried into my professional career."
Taking the company public
"It's surreal. It's nothing like I've ever done before. I found myself sitting in bankers' offices for two days before we went public. They're saying, 'Here's the book, here's who's ordering Portillo stock, and here's who wants to get in on this.' It's all fantastic, but everybody looks to me and they're like, 'Okay, now you got to say yes.' And I'm like, 'There's like 50 people in this room and it's this weird, overwhelming experience to hit that go button!' But I said yes, we hit go and became a public company."
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Dealing with inflation
"Year-to-date food inflation is well over eight percent. But we have not passed all of our inflationary costs onto our consumers. French fries, onion rings, beef, chicken — all have gone up significantly. But we're not raising prices excessively and we're not engaging in shrink-flation. You know, you used to get 50 fries in a small but now you're only getting 42. We're not doing any of that nonsense. We're still giving them the same abundance and same quality, at a slightly higher price point that's less than inflation. The average price per person at a Portillo's is $9.75 right now."
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Keeping his team focused on the right things
"The truth is I don't want my team thinking long term. I think the key to success in this business is to focus on the now. This is a hard industry. The work is tough. It's an industry that lends itself to high turnover, so we have worked really, really, really hard to make sure people are treated well. And that carries over to giving our customers a great, friendly experience."
Smart expansion
"I love my job. I love Portillo's. When I came here, we had 52 restaurants. We're 72 restaurants as of last week. We are in big-time growth mode and I can't wait to see us get to hundreds of restaurants. But I want us to be appropriately aggressive. There's a graveyard full of restaurant companies that expanded too quickly and lost their way. They became a different version of themselves. And so for us, I think it's vital to be true to who we are. Make sure that you're giving people a Portillo's experience, whichever restaurant they eat at. You need to make sure you're not diluting what it is that people come for."
Advice for future CEOs
"Do something that you love. As a CEO, you'll be working 50, 60, 70 hours a week. If it is doing something you don't love, you're going to be a miserable person. Don't think about the money and the titles and anything else. If you're doing something that you're passionate about, that really captures your soul, all the other good stuff happens. And I'd add that at the end of the day, a CEO is accountable for the decisions that they're making. So you can try to please people, you can try to do what you think other people want you to do, but if you're going to be a great leader, it's your job to make tough decisions. And you're going to be held accountable for your decisions. So do what you think is right and do the best that you can."
Check out more profiles of innovative and impactful leaders by visiting The CEO Series archives.
