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Jim KaaJim Kaa is the CEO and President of Polly’s Pies. He has spent nearly 40 years in the restaurant industry, formerly working as Vice President of Accounting for The Veggie Grill, Director of Financial Planning and Analysis for Pacific Restaurant Advisors, Director of Accounting for Ruby Restaurant Group, and Director of Finance and Administration for Bubba Gump Shrimp Co. Jim Kaa holds a bachelor’s degree in Accounting from California State University in Long Beach.

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Here’s a Glimpse of What You’ll Hear:

  • Jim Kaa’s venture into the restaurant industry
  • The challenges of owning and operating restaurants
  • How have Jim’s restaurants handled crises, such as 9/11, Hurricane Katrina, and the pandemic?
  • Jim’s vision for Polly’s Pies in the future

In this episode…

In this episode of the SpotOn Series, Chad Franzen speaks with Jim Kaa, CEO and President of Polly’s Pies, about his experiences going from Director of Finance and Accounting for restaurants like Bubba Gump Shrimp Co. and The Veggie Grill, to being CEO and operating all aspects of a restaurant. Jim talks about the unique struggles he’s faced, between Hurricane Katrina, 9/11, and the constantly-changing challenges of the pandemic. You’ll hear how Jim tackles adversity head-on, with innovative adaptations to stay ahead and keep his restaurants successful.

Resources mentioned in this episode:

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Episode Transcript

Intro  0:04  

Welcome to the Top Business Leaders show. Powered by Rise25 Media. We featured top founders, executives and business leaders from all over the world

Chad Franzen  0:20  

Chad Franzen here co host for this show where we feature top restaurateurs, investors and business leaders. This is part of our SpotSn Series. SpotOn has the best in class payment platform for retail and they have a flagship solution called spot on restaurant, where they combined marketing software and payments all in one. They’ve saved everyone from larger chains like Dairy Queen and Subway to small mom and pop restaurants. To learn more, go to spoton.com This episode is brought to you by Rise25. We help b2b businesses to get ROI clients referrals and strategic partnerships through done for you podcast. If you have a b2b business and want to build great relationships with clients, referral partners and thought leaders in your space, there is no better way to do it than through podcasts and content marketing. To learn more, go to Rise25media.com or email us at [email protected] Jim Kaa is President and CEO at Polly’s Pies, which has been in business in the Los Angeles, Orange and Riverside counties for over 50 years. Jim is a battle hardened restaurant executive with almost 40 years in the industry. He has been a key member of the management teams that grew Bubba Gump and Veggie Grill, he possesses an in depth knowledge of the people systems and information needed to run a restaurant company today. Jim, thanks so much for joining me today. How are you?

Jim Kaa  1:30  

Good morning, Chad. Great to be here. I’m doing well. Thanks.

Chad Franzen  1:33  

Hey, so you you have a bachelor’s in accounting from Cal State Long Beach. How did you get started in the restaurant industry?

Jim Kaa  1:39  

Well, my very first food service job was at Hoag Hospital in Newport Beach. My father was an administrator there and like many kids, you get jobs for your family uncle. And I worked in the kitchen when I was 16 til i was 18 later on, when I was going to college of Long Beach State again, I was getting a degree in accounting. And back in the dark ages, you actually looked in the newspaper for one ads for a job, pre internet world. And there’s an ad for a part time bookkeeper at a restaurant, Newport Beach, The Rusty Pelican. And I thought, well, a bookkeeping would make a lot of sense by getting a degree in accounting. And I started doing the books every weekend at Rusty Pelican. And while I finished my degree, and the smell of fresh coffee, fresh cream and just the energy and people the restaurant business, immediately attracted me to it. And basically when I graduated, I sort of stumbled into a job at the corporate office. The company had gone public in 1983 in the fall and then when I graduated that December, the next year in February, I was basically working as a staff accountant full time that Rusty Pelican. So that was how I got started.

Chad Franzen  2:40  

Okay, did you have you have you veered away from the restaurant industry at all in your accounting career?

Jim Kaa  2:45  

No, I have done finance and accounting for restaurant companies my entire business career. It’s kind of too late for me to change at this point. Sure, I probably could do retail but that’s the only and but I will tell anybody the energy and I get I love hospitality and the end is making people happy. So even though I’m in the finance and accounting and admin arm, it’s the joy and fun of being in the restaurants. It really makes it fun for me.

Chad Franzen  3:12  

So you didn’t really when you were pursuing the degree, you know, when you decided I’m gonna pursue an accounting degree, the restaurant industry wasn’t really in your thought process.

Jim Kaa  3:19  

No. And, and interestingly enough, I mentor accounting students at Cal State Long Beach, my alma mater, I’ve been doing it for about four years now. And I try to tell people, the restaurant industry is not just for somebody to do while you’re in college. Well, before you go on your career, it’s a real career. And it’s that getting people to think about it. It’s a different business. You’re going to work on weekends, you’re going to work on holidays, but you’re going to be off during the week, and everyone else is working. So depending allows you for young people, especially for growing restaurant companies, and I worked for Bubba Gump, we were opening restaurants in in Asia, in Japan as franchisees and our training team members were going to those openings. So if you’re 22 years old, and not many responsibilities, you want to travel the world. You know, opening restaurants can do that. But no, I, I was just getting a degree in accounting. So my father would let me live at home while I played in a band because I was going to be a rock star. But that didn’t come out turned out exactly as I plan on getting the degree in a real job worked out pretty good. In the end.

Chad Franzen  4:16  

What are you going to do in the band?

Jim Kaa  4:18  

I play guitar, so

Chad Franzen  4:19  

Oh, very nice. What would you say characterizes people whose careers have been in the restaurant industry?

Jim Kaa  4:27  

High energy for sure. It is a very high energy business. That willingness to serve but hospitality you want to make people happy? To me. It’s like being a party hosts, you know, a general mayor of a restaurant, especially a sit down restaurant. On Friday night. If they’ve staffed the restaurant, well, they they’re prepared for the night you’re really like the maitre d or party hostess greeting people. We’re looking for bottlenecks and trying to resolve them. So I think it’s the people for me, and the energy that really make it but it is a hard business. It has thin margins. can be very challenging, but it has great rewards. And again, I think it’s the people, for me that make it special.

Chad Franzen  5:06  

As someone with a background in accounting and finance, does the restaurant industry require a different approach in terms in those respects, than another industry might?

Jim Kaa  5:15  

Yeah, I mean, I guess in the industry like software, a lot of it has to do with selling software in the future and things like that. And the restaurant business, you’re selling today to that, you know, that sandwich salad, you know, on whatever the case is going out right now. So it’s a very transaction heavy business, it’s not so much complicated accounting. The things that make the restaurant business more challenging is there’s a lot of granular information, menu, mix information, what you’re selling, and what kind of gross margin those products are producing, is really a key to understanding our business. So it is fundamental accounting, they’re really just viewed the way anyone would look at their cost of goods sold. But in our business, that’s obviously food and packaging, primarily,

Chad Franzen  6:02  

how much how much is how much back and forth is there? Maybe you have a passionate chef who has great restaurant, or great recipes, idea, recipe ideas, but the data indicates that maybe that’s not that profitable, profitable, how much kind of tension is there in that respect?

Jim Kaa  6:18  

I mean, I think I haven’t worked in individual chef driven restaurants. The best step restaurateurs of the people understand the business to unfortunately, the number of people in life have gone well, my mom’s great cook, we’re gonna open a restaurant that have no idea about, well, how many seats do I have? How many meals a day do I need to serve, at what average check to pay my rent. That’s a calculation that every restaurant there is tension, because sometimes you also have products that maybe don’t sell that great and don’t have a fantastic margin, but they round out your menu properly. So, loft is a great example of something that has a high food cost you make a lot of dollars on whereas something like a soft drink that a fast food restaurant sells you when you’re giving the dollar burrito and soft drink is the soft drink that’s making all the money for him the burritos, probably a breakeven, if you will. But that cup and that soda cost him 20 cents, you just paid a buck 75 That’s the dollar 50 margin they made at lunch. So I guess it’s understanding the details that this is but again, a good cheat you can own your private only gets you so far if you’re not selling it or it isn’t making any money. That’s honestly if you want to watch what sells and what doesn’t stand at the dish station in a busy restaurant to see what comes back and eaten. We had a dish one restaurant that was a spinach side dish, and no one ate. It tasted great, but no one ate it so you learn quickly. The masses didn’t want us to do side dishes what it came down to

Chad Franzen  7:46  

tell me a little bit about Polly’s Pies.

Jim Kaa  7:49  

It’s interestingly enough, it’s still owned by the two brothers, Eddie and Don Sheldrake, who founded it in the 60s. They were originally KFC franchisees in fact, we still own and operate 10 KFC is in this door on 14 Polly’s Pies. And Eddie the founder when he opened the KFC is was enjoying it and it’s a wait a minute, why am I paying all these royalties and advertising fees to someone else? I’m gonna start my own restaurant. So they opened in 14 and the restaurant actually our third restaurant Atlantic is 50 year anniversary coming up here. We’re going to have a 50 year anniversary celebration but the various variants have been every time we’ve tried to plan something we seem to have a Omicron type event and stop posting just oppose it. And are we operate breakfast lunch and dinner. Our busiest day parties breakfast are really well known for our giant cinnamon rolls and pancakes. But we sell a great deal of pies and baked goods we we have fresh baked bread in every store every day we bread sourdough raw, which is really fantastic. Cinnamon Rolls cookies, so we are working under the name Polly’s restaurant bakery. While we’re not a full service bakery where you can come in and order a cake with a picture of your face on it. We do provide a variety of fresh baked goods available every day.

Chad Franzen  9:06  

When you say breakfast, lunch and dinner, do you have like time periods designated for those.

Jim Kaa  9:11  

I mean, we serve some breakfast products all day long. That because the the change you need to make on your cooks line, you really have a breakfast period that runs roughly open which can be seven or 8am depending on the store to about 11 and then lunch around 11 to four and dinner after that. We’re looking to go to brunch menu on the weekends actually where we have one menu based group have opened till about 330 and then change to the dinner menu. You know when I started in this business 40 years ago, the labor pool here in California was deep and not that expensive. And now the labor pool is not always shallow. It seems to be empty Sunday’s are very expensive. So how you operate in today’s world is a little different than how you did you know 20-30 And you know the employee shortage was very tough even a year and a half ago but honestly over the last year 90 days is probably has been as tough as I’ve ever seen in my career.

Chad Franzen  10:04  

Is there a reason why you would differentiate between lunch and dinner? I know that’s kind of unique compared to some restaurants I’ve been to,

Jim Kaa  10:10  

you know, if you were to look at our menu, again, lunch tends to be more sandwiches, salad soup, something like that. And dinner for us trying to have, we have items like salisbury steak and chicken pie dinner, we just rolled out a new lasagna and meatloaf. Were very much you know, American comfort food. So we’re trying to really create some new menu items that are more interesting at dinner to dinners, our slowest day part. And so we want to, for whatever reason, in the restaurant business, a lot of people who use the restaurant for breakfast, don’t go to that same restaurant for dinner. Sometimes they do sometimes they don’t. You know, our challenges, we have people who buys pies from us, Thanksgiving and Christmas, we don’t really use this as a restaurant during the year. So how do we convert some of those people to diners, so really is trying to look at our customer base, he will I mean, on Saturday and Sunday at breakfast, we have a line out the door now that we want to diminish that demand, but I can’t you know, we’re doing almost maximum. If we have more servers, that would be a little bit better. But we’re really busy, then we’re not as busy dinner. So right now we’re trying to how do we get people to know we have no beer and why we’ve remodeled our stores. And we’re in the process of doing that but making dinner more viable day partner for our company?

Chad Franzen  11:21  

How are your current responsibilities as CEO different from maybe jobs you’ve had in the past where you were vice president for accounting at the Veggie Grill or Director of Finance and Administration for Bubba Gump.

Jim Kaa  11:30  

He is the CFO here at Polly’s for about four and a half years for it to go over, you know, two things, it never ends, you’re on 24/7, which comes with the territory, you know, you certainly understand that. It for me the biggest challenges in Vice President role or CFO role, there’s times where I’m not in a marketing meeting, or maybe not in a menu development meeting. Because I’m not part I can’t be in this, I don’t know it. So there’ll be times where I’d have, you know, hours, if you will to work on financial modeling, it’s specific to me, as the CEO, my day is more spent making sure my key people are all doing. I know they’re doing what they’re supposed to do, but working with them to help if they’re my vice president operations, my director of HR director of IT, etc, all driving the company forward, based on shared goals and visions, and they’re successful, I’m going to be super successful. So I spend most of my day working with the people in the company, helping them make decisions, supporting them, instead of many days, it’s four or five o’clock, but I think, well, I’m getting to my work now, if you will, the stuff I need to do for my own job for the day. So it’s keeping that energy up 24/7 For all your people, you can’t let down because you can’t let them down. And so I think that’s the biggest challenge I found is your grinding accounting to 11 at night by yourself is hard. But that’s a different kind of hard, staying motivated to go from a marketing meeting to a construction meeting to a, you know, Unifor meeting in that minutia, you need to and you have to take the energy to really, when you go to a meeting, if you’re not going to think about what you want to get out of it, what the results should be have a to do list that comes out of it. You know, sometimes you need to think about ideas that you’re trying to get somewhere, you need to have a productive meeting and put time and thought into that. That takes energy. And, you know, I find myself sometimes my brain shot at the end of the day I’ve given all I can give sort of thing. But that I think is the biggest challenge that you’re trying to keep the entire company marching to that beat that you’re it’s a lot about is people understanding of shared goals and priorities. You know, we had a staff meeting recently, our fiscal year starts in October, I mean, November, pardon me, about what we want to try to do during this fiscal year. And our goals of remodeling stores and leveraging technology, along with menu development, etc. You know, that’s really the key, and then everyone’s again, marching towards the same goal.

Chad Franzen  13:57  

Have you found that your attitude or demeanor or the kind of the tone you set, even maybe in an office environment can trickle down to people, you know, people, washing dishes or whatever, at the restaurant, part time employees.

Jim Kaa  14:11  

It’s interesting you say that, I never realized that I’m an outgoing person. My mother was the kind of person who knew everybody on the street and I inherited her gene of being a friendly, outgoing person. And because of that, I love being in the restaurants. So for me, it’s how to say it’s really easy to stay motivated. On the day before Thanksgiving, when we’re really really busy. I went to eight of our 14 stores, Mr. Just showed up and say hi, and the managers employees. I mean, I’m just a regular guy from the neighborhood, if you will, and so when they are excited to see me and happy to see me and happy that I came to visit them, I mean that makes the grind part of our job, so worth it. And I’ve also learned that in the office here or if I, again, if I’m going to be down there all the hand wringing, meeting those guys falling, everyone’s going to feel that and feel that same thing. It’s like traveling when your kids you know, and they’re like, as a plane going to be on time. Sure it’s going to be on time, I’m telling them knowing full well, probably not going to be on time with their kids to worry. So it absolutely, I need to set the tone, both from being not, it’s easy to get frustrated and angry. Sometimes I have to go close my door. And I kind of let my anger temper if you will, because you’re frustrated. And I don’t want to take that frustration out on employees. But it really is really important to that shared messaging goal, whether it’s a dishwasher, a manager, someone in our office here, because they do look to you. And if you are showing, you know, oh my god, this isn’t going to work, they’re going to feel that. But on the flip side, you have to be, you can’t be falsely confident. You need to do the diligence and the work to have that confidence. I’ve worked with some great people in my career, Scott Barnett, who ran Bubba Gump, great Dollarhide, who ran Veggie Grill, and been exposed to many, many other executives and bankers are really smart people. And having watched them work and learn from them and watch them in crisis mode. You know, whether it was 911. Katrina, when it hit the Bubba Gump in New Orleans, you know, when you’re watching your store, get destroyed, they get damaged on TV, there’s nothing you can do. You know, that’s a painful thing to be in. And all you can do is say, Hey, we’re going to be back, we’re going to open which we did for Bubba Gump, etc. And so it really is really, really important how you set the tone for everybody you talk to, and again, I will talk to everybody, I’ll shake the dishwashers and I’ll shake the servers. And if you’re not going to do as the president, then you’re not the right business, our business the

Chad Franzen  16:45  

way. When you think about your observations of those other people that you’ve worked with working in crisis, are there kinds of examples that you can think of? Like, like, yeah, that’s how I that’s how I would or that’s how I would like to do it if I were in that situation.

Jim Kaa  16:59  

Exactly. I mean, you the hard thing for all of us is what we control what we can’t control. Now, we’ve been hit hard, but Omicron these last three weeks or so, I don’t think we’ve had every store open for everyday part. Some sort of days, we’ve had to close to have takeout only some days, we’ve had to close for dinner. And it’s very frustrating. But yet, I can’t do anything about it. Really, I want our employees to be healthy. I want our guests to be healthy. So all we can do is sort of wait it out and hope it passes quickly to get back to a norm. You know, again, two weeks after Thanksgiving, I was thinking, Okay, we’re as close to normal as we’ve been for a couple years, things are not going on my Woodhead here that things are going pretty well. And then the week for Christmas, you know, started hitting us pretty hard. So I think it’s that staying the course is one part of it. And And again, what can we really impact it not I mean, Katrina, it’s a hurricane, I guess all we can do is lock the doors and get the heck out and make sure people are safe and go back and try to get open as fast as you can. So I think it’s that, that that focusing on whack and really impact? And is there a way to impact anything

Chad Franzen  18:07  

Since COVID? started kind of in early 2020? Has it affected or changed your operations at Polly’s Pies at all?

Jim Kaa  18:16  

Absolutely. Well, I mean, I would think for everyone who’s been through this when you know, in, I’d say March, April, May of 20. When you’re first you know, two months into the you know, something has never really happened in my business career. You’re saying okay, what do we do? If you recall, really, it was the week I just happen to remember. Because in March that when I had been in California and venture Disneyland with my wife on a Sunday, and it was that week, I think Wednesday or Thursday, when Disneyland close, the NBA canceled their season and everything. So we’re really busy on March 14 Pi Day 3.14. And we also do a great deal of meals on pay Patrick’s Day, we do the corned beef meals. So we were locked and loaded for a huge Pie Day. And a huge day Patrick’s in 20. And of course everything ended, and you didn’t know how long was gonna last. So I was thinking man, well, you know, by fall will surely be back to normal. And that obviously that was very short sighted, by far, you’re thinking well, by next spring of 21 will surely be back to normal. And so we shrunk our menu. We were there was no dying in in California, and you have tons of servers you kill. You can’t bring in six servers with nothing to do and have them stand. It’s harder to manage them. So you had to do a lot of different things. We closed one store because we had to sell enough people to run it. So yeah, you had to change to adapt. As I said, as the conditions on the ground change. We have to change our tactics. In California when there was a mask mandate. We posted a per OSHA you need to wear a mask and doors. Many guests would not wear masks. And so we I Eric our VP of ops and myself instead In our managers not to be the mass police, we we we posted things on the door, we requested everyone wear masks, there’s someone comes in and isn’t going to wear one. It’s not our job to enforce that. Because then you have people screaming at managers angry leaving, I said, Look, we’re in the business to make people happy. And occasionally you’d have another guest that well, they’re not wearing a mask. And we were saying, I’m sorry, we request mo wear masks, but we can’t, we’re not here to enforce it. And you know, you have a couple people walk out and things like that, but we’re doing everything we can to make everyone safe we have when we close our stores at dinner a week or so we got a complaint or a complaint. I can’t believe you’re close tonight. at all I can say is I don’t want to have sick people very food for you. You know, I have to do what’s not only right, legally, I have to do what’s right as as a person as a business leader, I’m not going to have sick people working in a restaurant. You know, we have to report to the health department here in California when you have more than three people outbreak. I was thinking every restaurant in Southern California, if they’re, I guarantee everyone’s not recording not because they’re bad people because they’re too busy. They just don’t have time to do it. It’s been hard for us to do meet compliance requirements legally, because there’s so many sick people so fast, so it’s costly to have to operate differently.

Chad Franzen  21:16  

Do does Polly’s Pies have any kind of unique goals or plans for 2022

Jim Kaa  21:22  

We’re actually changing our complete ERP accounting system and modernizing it. Last year we put in a different online portal. For online ordering using oil one of the largest providers in the online business would work very well for us. We’ve been remodeling a lot of our poly pipe stores, we rolled our Long Beach store in our habit store. And then we’re also looking our restaurants now or sit down restaurants where you know we have servers come to you looking to develop a smaller footprint concept that has all our baked goods or takeout that you would order to counter like a quick casual restaurant and still have the service food brought to you there’d be someone on the floor selling mimosas and coffees and things like that, that you in California with the $15 minimum wage for servers to see if a quick casual version of Polly’s would appeal to our desk. I believe that will though some people really like hospitality they still want to sit down and have a server. Now over the last few years the move to quick casual has been big when I worked at Veggie Grill they were really doing well in that space. But there are people still really enjoy want to sit down and have breakfast and have someone bring my meal to me and refill my coffee. So really for us it’s re purposing a lot of our current restaurants, introducing new items and also seeing if we can develop a smaller concept and also we’re looking into licensing our pie for manufacture outside of California and potentially going into grocery stores as well but in California and outside. So our golden goose is our pies we offer really high quality handmade pies all our pie double crust pies like an apple and boysenberry are made here fourth and as requested or Commissariat bought in California, so everything is to expand. We’re well known brand here in Southern California. But we still have a lot of ways. We’re not well known a lot of ways to so we have a lot of opportunity to grow. It wasn’t really the big thing for what yeah,

Chad Franzen  23:15  

what meal and pie are your favorites.

Jim Kaa  23:18  

There’s a couple I’m just a tradition. I love apple pie remover, no ice cream, but we have a couple of pies our strawberry lemonade pie, which is a lemon of a lemon moraine pie with fresh strawberries over the top with whipped cream is like a strawberry lemonade with our pie crust is fantastic. One of my favorite meals is our Saulsbury steak, which is the classic Americana meal that my father happened to love. And I love that but honestly our breakfast there’s so many good things The pancakes are fantastic. I just look at the pancakes and I gain weight. I don’t think I have to eat him anymore. Almonds are anxious to get almost anything you get a breakfast but our giant cinnamon roll was another sort of Polly’s Pies signature product, it’s an oversized is gooey sticky. The OData diet roll but if it tastic tasty somebody could share with two or three people to a truly great.

Chad Franzen  24:13  

Well I’m hungry now. How can people find out more information about policy? Polly’s

Jim Kaa  24:16  

pies.com We’re here in Southern California. You can find this everywhere you can order on DoorDash Uber, you go to pollyspies.com and order. Preorder for the future. We’re easy to find here in Southern California.

Chad Franzen  24:30  

Okay, sounds great. Hey, thank you so much for your time. Jim. It was great to hear from you.

Jim Kaa  24:34  

I really enjoyed it. And there’s a great service you’re offering putting some really great people in front of people and I look forward to seeing some podcasts and future myself.

Chad Franzen  24:43  

All right. Sounds good. Thank you so much, Jim. You too. So long, everybody.

Outro 24:47  

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