Purple, Green, Golden, and Blue: Pal's is a Goldfish Paradise

Burgers, hot dogs, fries, and milkshakes. It’s the quintessential backyard American food and a staple of Americana fast food. But these establishment are a dime a dozen, aren’t they? Sure, there are the Chick-fil-A’s of the world. But isn’t it nearly impossible to carve out your own identity in this sea of sameness?

Pal’s Sudden Service, a double drive-thru fast food restaurant chain with 26 locations in Tennessee and Virginia, is certainly up for the challenge. Pal’s believe that an emphasis on its people, speed, customer service, and quality is what truly sets them apart.

Here are five quick facts about Pal’s Sudden Service that demonstrate that the proof is really in the pudding (or their milkshakes for that matter): 

  1. An astonishingly low turnover rate with the at the assistant manager level coming in at 1.4 percent, the hourly staff at 32 percent, and has only lost seven general managers in 33 years. In comparison, most fast food chains have an average turnover rate between 50-150 percent with management and hourly employees aggregated together.
  2. An average of 18 seconds at the drive-up window, and an average of 12 seconds at the pickup window to receive the order for a grand total of 30 seconds. That’s four times faster than the second-fastest quick-serve restaurant in the country.
  3. Pal’s makes a mistake only once in every 3,600 orders. That’s nearly ten times better the the second most accurate fast food chain, Chick-fil-A.
  4. 1,100-square-foot buildings accruing right around $2 million per year in sales. That’s just over $1,818 per square foot. The iconic Shake Shack and Chipotle restaurant chains come in at $387 and $250 in comparison, respectively. Remember, it’s not how high your sales are, it’s how much you bring home to the bank.
  5. One of two restaurant chains that has ever won the Malcolm Baldrige National Quality Award. This prestigious award caused Pal’s to create the Business Excellence Institute (BEI) as a way to share best business practices with others. The other restaurant winner of the Baldrige award is a BEI client, Mighty Fine Burger.

By now you’re probably very impressed but this all begs the question, how does Pal’s do it? 

Here are seven differentiators that Pal’s has instituted that you can learn from:

  1. An emphasis on great people – Pal’s has developed and fine-tuned a screening system to evaluate candidates that includes a 60-point psychometric survey, based on the attitudes and attributes of Pal’s star performers, that does an unprecedented job of predicting who is most likely to succeed.
  2. Top-notch training – Once Pal’s selects its candidates, they put employees through 120 hours of training before they are allowed to work on their own, and must be certified in each of the specific jobs they do. Pal’s also has assembled a Master Reading List for all the leaders in the company and it includes 21 books that must be read. Every two weeks, the CEO, Thom Crosby, invites five managers from different locations to discuss one of the books on the Master Reading List.
  3. Ongoing training – Pal’s believes that all leaders are trainers and educators. They also believe that people educate by their attitudes, their behaviors, and by their focus. At Pal’s, every leader needs to have a coaching and training target every single day. Management and leadership asks their employees at random, “What’s your target for today?” Every single employee has to have a person and a topic every single day.
  4. Technology – Pal’s has a proprietary “training tracker” software system that manages all employees. The software quizzes employees at random every single day whether it’s their first day on the job or they’ve been there for 10 years. The software goes through the basics, the most critical parts of the operations with employees. Management then conducts an observation to make sure the employees are still adhering to the standard 100% without exceptions.
  5. Development of leaders – Employees who have scored 100 percent on four re-certifications are eligible to become coaches within their restaurants and help their colleagues consistently develop and adhere to their standards. According to the CEO, “We are looking to get people to this mastery level.”
  6. A commitment to staying top of mind – Pal’s recognizes that all restaurants are chosen from a defined mental rolodex by customers. and believe that customers only ever think about 2-10 establishments. This is the reason why Pal’s created their website to have a unique and inspiring thought of the day, local movie theatre showtimes, and the CEO answers every single question through the contact form. This is what keeps people coming back to Pal’s site and provides a useful service to the communities Pal’s serves.
  7. A focus on culture – According to the CEO, “Sometimes I get that itch that maybe it’s time to step up and expand faster. But we want to make sure that we hand off all the cultural pieces to each store. I see operations that outgrow their cultures. They can’t pass on their culture so they go from a really great concept with great people to weaker and weaker operations and people who don’t understand the origin of the culture.”

What’s preventing you from instituting world class principles just like Pal’s? Does your business do anything similar? Leave a comment below.

Today’s Lagniappe (a little something extra thrown in for good measure) – Be sure to check out this incredible overview about living your mission from the president of Pal’s BEI, David McClaskey.