Secrets of "In-n-Out" Success

from Daily Finance.com 02/13 compiled by Peter/CXO Wiz4.biz

In-n-Out, the iconic hamburger chain. has > 300 locations in California, Arizona, Utah, Nevada & Texas, took in an estimated $1.1 billion in revenues in 2012. So how is this burger joint pumping out per-store sales numbers that are better than Burger King and most of other competitors?

BusinessWeek writer Stacy Perman has penned a book ( IN-N-OUT Burger: A Behind the Counter Look at the Fast-Food Chain That Breaks All the Rules ) that chronicles how In-n-Out Burger founders Esther & Harry Snyder built the foundation for a business, that has performed well since it debuted in 1948. Here are the six principles she says that have made In-n-Out Berger an Out & Out success:

1. Listen to Your Customers — One of the company’s mottos is “Our customer is everything.” Applying that belief, led to the company policy of preparing burgers just the way customers asked for them. Some of the customer favorites became popular and were eventually adopted as the restaurant chain’s “secret menu.” By listening to their custo-mers, In-n-Out created menu choices other stores couldn’t duplicate.

2. Keep a Relentless Focus on Quality — Perman says that the Snyders were “micro-managers” from the beginning, insisting on only using the highest quality beef, produce & other ingredients at their stores.

3. Treat Employees Well — The Snyders always held their employees in high esteem, paying them higher wages than competitors and calling them Associates to make them feel more connected to the franchise. “They believed in sharing their success with their employees,” says Perman, noting that In-n-Out associates make $10 an hour working part-time (above minimum wage in most areas) and starting Store Managers make $100,000, plus bonuses tied to store per-formance. The company benefits package is also generous. Such treatment engenders loyalty from workers. “In-n-Out has the lowest turnover rate in the fast food industry, which is notorious for turnover,” says Perman. “They say that the average manager’s tenure is 14 years, but they have managers who have been there 30 or 40 years.”

4. Keep Things Simple & Consistent — Another of Harry Snyder’s mottos was, “Keep it real simple, do one thing and do it the best you can.” That theme runs throughout the business. “People get cynical about changes at different companies, but they always know that In-n-Out doesn’t change,” says Perman. “In n-Out stands for something (their quality brand) and they’ve stuck to it and their customers really see that.”

5. Expand Slowly – Under the Right Conditions – In-n-Out has strict guidelines that limit the growth of stores, but ensure each store’s success. “They locate within 500-mile of ingrediant suppliers – to assure it will be fresh” says Perman. “Most deliveries are daily.”

6. Define Your Own Level of Success – In corporate America, where success is sometimes defined as rapid growth at any cost, In-n-Out has, as the title suggests, made its own rules. “If the customers and the employees were happy and they were making the best product they could, they were successful,” she says, “and they have maintained that philosophy.”

Comments: Can you take a bite out of this? What has been your experience?