Jeffrey Chodorow, Co-Owner China Grill Management

By Amy Tarr

Jeffery Chodorow is the co-owner of China Grill Management, a company that owns and operates over two dozen restaurants worldwide. Jeffery is the king of restaurant concepts – starting with the widely popular China Grill in New York, which is in its 18th year, and has expanded to Miami, Las Vegas, Mexico City and Chicago (and we hear Madrid is next). Jeffery is well known for the Asia de Cuba restaurant concept, too, with locations in New York, LA, London and San Francisco. He is also a partner in such chef-driven restaurants as Claude Troisgros’ Blue Door in Miami, as well as Alain Ducasse’s Mix in New York and Las Vegas, and English is Italian, Jeffery’s latest collaboration with Todd English in New York. He gained notoriety through his involvement in the reality TV show “The Restaurant” with Rocco Di Spirito, and shares his insights on the experience with us.

Amy Tarr: You’re involved in two dozen successful restaurants around the globe. What are the keys to your success?

Jeffery Chodorow: Our restaurants tend to fall into different categories. I’ve tried to focus on 3 things: (1) To create restaurants that are really much more than just about dining, and where food is central to the equation but not the sole reason for being. If you don’t have good food, you won’t last. As I always tell my staff, it’s not just about the food but it’s always about the food. (2) We execute extraordinarily well over long distances. We’re manic about consistency. Every environment you go into, you have to adapt to different kinds of customers. The signature dish at China Grill in New York was Crispy Spinach. We sent a chef from New York to Miami and after a week he had to take the Crispy Spinach off the menu. The chef said he couldn’t get it crispy enough. I hired a chemist from the University of Miami to do some analysis, and we figured out a way to dry the spinach in a certain way and came up with a methodology to modify all the recipes for humidity content. We’re able to make the food in Miami completely consistent with the food in New York, so people have a similar experience. (3) We like to do new things. It’s fun to open a China Grill or Asia de Cuba, but not as fun as a new concept. We’re risk takers. A lot of passion and energy goes into these new projects.

AT: Many restaurateurs feel location is everything. What are your thoughts on restaurant location and real estate, and what advice do you have for young restaurateurs regarding the location of their first restaurant?

JC: I tend to be one of those people who doesn’t get too hung-up on location, although some people would say I’ve made some of the worst location decisions ever! When I opened China Grill in Miami in 1995, people said it wouldn’t work because we built it in a spot that was not where the action was. But, if you build it, they will come. Look at Peter Luger’s in Brooklyn. People are very mobile today. In New York, it’s a cab ride away. To me, I deal with location issues secondarily. I start with real estate – do I like the real estate? I’ve never made a decision not to do a restaurant because of location.

AT: The New York Times review of Ono earlier this year took issue with the term “restaurant concept.” This term has taken on a negative connotation in the industry, suggesting that the focus is not on food, but rather on design, drinks, or a gimmick or overarching theme. The review even went so far as to call Ono an upscale Chi-Chi’s with more premium ingredients and therefore higher tabs. How do you respond to this criticism?

JC: Frank Bruni is out of touch with what the dining population wants. I spent an hour on the phone with him after a review was written, before the review came out. He was asking me where the idea came from for an extensive small plates menu. You go to a restaurant and do you want to eat your appetizer, entrée, and dessert or would you like to see what the chef’s capabilities are? If you’re spending $50 for a meal, isn’t it better to eat 10 things than 3 things?

He’s completely wrong because the food is always first. I have a major issue with reviews because I think [reviewers] go in with a previous disposition as to what to expect based on something that’s written to them. They don’t go in open-minded about what the idea is. And critics especially seem to think that if you design a restaurant that is fun, lively and exciting, that somehow means you don’t care about the food. We spend 95% of our time working on the food.

AT: America watched your business relationship with Rocco Di Spirito fall apart on national television. What sort of impact did “The Restaurant” have on your overall business? Did your high profile in the media ultimately benefit China Grill Management?

JC: You have to know the background. I agreed to do the show for one simple reason - I love Italian food. I loved the concept of it. The concept of a very talented chef, returning to his roots, cooking with his mother has widespread appeal. I got caught up in the emotional part of it. Fifty thousand dollars of free publicity was something I couldn’t miss. No matter how sure a thing it is, there are no sure things, because so many things can happen.

I wasn’t supposed be on the show. There wasn’t going to be a second season. Rocco signed up without asking me. I said, this restaurant is a disaster. I did the second show to save my standing in the industry and the end result was that I have had not one negative comment. I get stopped on the street all the time. And I’ve gotten not one negative comment about the way I handled the situation. I received thank you letters from people who own restaurants. But did it increase business? I can’t really tell.

AT: In working with Rocco on “The Restaurant,” what did you learn about balancing a chef’s ego with the integrity of the restaurant?

JC: As I like to say, if you’re working with a celebrity chef, you need to make sure that that chef is a chef first and a celebrity second, not a celebrity first and a chef second. I work with a lot of celebrity chefs- Todd English, Claude Troisgros, Alain Ducasse. The one thing that’s true about virtually all of them is they all come at it with a dedication to creating the best product. What I learned from my Rocco experience is, here’s a guy who is fundamentally talented. But he got too caught up in the glitz and the glamour, and not enough in making sure that what was on the plate was what it needed to be. For someone like me, there’s a certain dynamic that takes place. A lot of celebrity chefs are not fundamentally food people. But I’m a food person. When you work with me there has to be a give and take. Alain Ducasse takes advice from me on his food. I tell him when I don’t like something, when it can be changed. And he really responds to me on stuff like that. If you don’t have that kind of relationship with your chef and you are a restaurateur, it’s not going to work.

AT: Building the right team – within each restaurant and across your management company - is fundamental to your overall success. How does the notoriously high turnover in the industry impact your business? What kind of recruiting and retention strategies have you developed to contend with the high turnover rate?

JC: First of all, you’ll be surprised to know that at the top level of our business, we have a small number of very loyal people. We only have six people –me, a CFO, our General Counsel, Corporate Chef, Director of Operations and a Comptroller. Then we’ve divided ourselves up by region – Europe, Florida, New York, and the West Coast. We have regional directors of operations. We don’t have a lot of layers of people in our company, so there’s tremendous growth opportunity. My Director of Operations is from Blue Door Miami. My Corporate Chef was my hotel chef. We are very, very encouraging of lateral movements, upward movement, city movement.

There are a lot of personal relationships from me on down. I travel extensively, and when people see me show my face in these restaurants, it sends a message to them that this is not some faceless, corporate structure. There are people who really care about this place and drag their ass all over the world to see how it’s doing. I have a big open-door policy. I’ll listen to anybody about anything. Sometimes I get faulted in my own organization because I get involved in personal issues of employees. I’ve put employees through alcohol rehab. So we tend to get this Walmart enthusiasm where people think they matter and they are part of something; it’s not just a job.

Every year we bring all the managers together for a 2-3 day retreat. We talk about ways to improve performance and productivity, and we share ideas. We do that at the regional level. At the restaurant level, the key people at the restaurant take 2 days off, go someplace and talk about ways to make the restaurant better. Also because of the way we’re organized, we’ve done cross-training at other properties. We have a tremendous support system, so when we open a restaurant, waiters, busboys, bartenders, and managers – a team of 15-30 people who have experience in our culture, come for the first 6 to 8 weeks to share our culture with the new group. We spend more money on pre-opening than any other restaurant group.

AT: A hot button in the industry today is equity compensation for chefs. What are your thoughts on this?

JC: It depends on the chef. We have 2 kinds of relationships. We have relationships where they are really more concept-driven and then chef-driven. China Grill is a concept-driven restaurant. We have excellent chefs, but they didn’t create the concept. I wrote the menu for Asia de Cuba. We have a great chef at Ono, but the menu outline for the restaurant was done by me. For all of our management people, not just chefs, but also front of house staff, we have a profit sharing and a 401K plan, but not equity. Equity is only the right to receive part of the profitability of the restaurant. Management people share the profitability of restaurants based on a bonus arrangement – performance factors such as staff retention, restaurant maintenance, and a whole series of subjective and objective criteria.

In the case of Alain Ducasse, Todd English and Claude Troisgros, i.e., a chef- driven restaurant, those deals run the gamut. Some are purely consulting arrangements. For others there is an equity program. Usually the chef makes an investment of some kind – it’s disproportionate, but they step up to the plate and make an investment with us. And they may have the right to earn certain equity positions.
I’m partners with Alain Ducasse in one restaurant, another is purely consulting, another is an overall shared consulting arrangement – so each one is different.

AT: What about the value of PR?

JC: I believe strongly in PR – I’m not a big proponent of advertising. We tend to open restaurants with food publicists. I’ve opened restaurants in the past with multiple publicists who have different specialties- social, marketing, style. When we opened Asia de Cuba, we had seven PR firms - one for each focus group– and that was a huge success. You need to sit down and look at all the target audiences you need to hit and whether you feel that any particular firm has the reach to hit all the target markets. I’m coming to the conclusion that they don’t – you need two that have different strengths. Especially if you’re a restaurant concept, it’s important that you hit the style component. With Ono we did a high-profile event during fashion week – The Damon Dash, Patricia Field, and Michael Kors shows - they were coordinated not by our food publicist but by our style publicist who organized it on a fashion and social basis. It’s fodder for the gossip columns. Ono cost $11 million to build (which was $5 million more than I wanted to spend). If you’re going to spend $11 million on a restaurant, don’t chintz on the PR. Even I, with all the experience I have in building restaurants, screwed up big time. So it’s not like I’ve mastered the subject.

My restaurants function at high levels of profitability. Typically it takes 12-13 months for payback on the investment. At Asia de Cuba (in New York), my investment was paid back in 10 months. Because of where I am now, credibility-wise in the industry, the last 6 restaurants I built, only one required an investment in construction on my part. I didn’t have to build them, because people were anxious to have my concepts.

AT: What key piece of advice do you have to share aspiring restaurateurs?

JC: It’s going to take a lot more passion, energy and commitment to open a successful restaurant than you can possibly imagine. And it’s going to cost more than you can possibly imagine. When you’re there, you have to make sure you’ve left enough resources and reserves to survive the opening. The biggest reason for failure – and there are a lot of good ideas, and talented people who have failed in restaurants – is because they are undercapitalized. It never costs “X.” It’s X + 80% or 5X. You have to understand that going in, not when you are there at the point of opening. You have to have enough of a cushion to get over the hump because it may take a while to get it there. Great restaurants fail because of lack of money.