Restaurant Hospitality: Why Community Still Matters in a Digital World

00:06 — Anthony Presley: 

Thank you so much for hanging out. 

 

00:07 — Deric Rosenbaum: 

Absolutely. 

 

00:08 — Anthony Presley: 

If there’s a couple of people on the planet who don’t know who you are, would you mind telling everybody a little about who you are and brand you’re with? 

 

00:14 — Deric Rosenbaum: 

Sure. I am Deric Rosenbaum. I am the President and CTO of Groucho’s Deli. We’re 85 year old brand based out of Columbia, South Carolina. 31 Units today control growth and I have a pretty deep tech stack for a brand our size. 

 

00:29 — Anthony Presley: 

You do? You absolutely do. I want to laser in on that. You’ve been around just a few years. Just a few years. 

 

00:36 — Deric Rosenbaum: 

Just celebrated 85. 

 

00:38 — Anthony Presley: 

85 Years. So what do you hold as the key to that success? 

 

00:43 — Deric Rosenbaum: 

I mean, ultimately is community. 

 

00:45 — Anthony Presley: 

Okay. 

 

00:46 — Deric Rosenbaum: 

You know, we spend a great amount of time with our operators and our franchisees and instilling a sense of community because that’s how you find longevity and success and fostering that sense of community and building what I like to call the art of the perceived relationship. You know, when you walk into a restaurant and you just get the feeling that it’s. You’re in the right place. 

 

01:07 — Anthony Presley: 

Yeah. 

 

01:08 — Deric Rosenbaum: 

That’s what I call the art of the perceived relationship. You know, I don’t know everything about you, but I know enough. I’ve seen your kids grow up and play softball and come in every Saturday after the games. And we know what you’re going to order and we bring that familiarity. And you know, it’s hard to replicate that, especially in a franchise model. But that’s why we focus on controlled growth, so we can foster that sense of community with our operators and our team members. I love that. 

 

01:34 — Anthony Presley: 

I love that because that’s. You often see these exploding brands. They’ve taken in private equity money, they’ve taken all this stuff, they’re just opening door after door and then, you know, six months to six years later just all falls apart. 

 

01:46 — Deric Rosenbaum: 

I mean, you get over leveraged and understaffed and under brand. Under. That’s not a word. 

 

01:51 — Anthony Presley: 

But yeah. 

 

01:51 — Deric Rosenbaum: 

You know, you have no brand relevance because it’s so diluted. 

 

01:54 — Anthony Presley: 

Right, right. Yeah. And so you’ve taken, you and the brand have taken a very different approach. 

 

02:00 — Deric Rosenbaum: 

A lot of things I’m pretty contrarian about. Definitely be one of them. 

 

02:03 — Anthony Presley: 

Yeah. As I’ve gotten to know you over the years, I know you’ve got some contrarian views, but you also have some views that just really make sense. And that building community, having. Having your team members drawn from the community. Correct. And then Making sure that they’re really well taken care of. You’re very focused on that as I’ve observed. Could you talk a little bit about how maybe that’s changed in the last few years? Has, has hiring changed as job seekers changed, as the market changed, as to how you need to approach or train your people? 

 

02:33 — Deric Rosenbaum: 

Absolutely. You know, I think between the digital renaissance and then kind of the social fallout effects of COVID Okay, yeah, things have absolutely changed. Things have absolutely changed. You know, 20 over, you know, 26 years ago when I opened my first restaurant, you know, it was very different. It was just a hands on man kind of bring you through the process, training and very hands on and validated type training. And you know, now we’ve gotten into the vast majority of our team members are what I call life transition employees. Okay. High school to college to career. Okay. So, you know, we’re bridging a gap and I think the difference, you know, a quarter century ago is the 16 year olds, the 17 year olds being a first job. Right. A lot of we’re a first job for a lot of people. 

 

03:23 — Deric Rosenbaum: 

They had some basis of social skills and eye contact and things like this and you know, the digital renaissance and everyone now that’s 16, 17, 18 working for us, they’re all digital natives. Right. They’re iPad kids. Right. They grew up with these devices. And so we’re spending more time on eye contact and how to properly answer the phone and engage with our guests and provide that art of the perceived relationship. Right, right. And the value that brings and the skills that you learn in that first job and how that applies to the rest of your life. 

 

03:57 — Anthony Presley: 

Nice, nice. So you don’t just say, what’s up? That’s not the phone call. 

 

04:01 — Deric Rosenbaum: 

Yeah, yeah, what’s up? What you want? Honest to God, I was in the drive thru one time years ago with my kids and it was a McDonald’s and we get up to the window and I’m sitting there and then the window opens, she goes, y’ all order some food. And I was just like, what else would I be doing here? 

 

04:24 — Anthony Presley: 

That’s pretty funny. 

 

04:25 — Deric Rosenbaum: 

That’s pretty funny. You know, common sense kind of plays into this whole equation too. And then molding the way that you provide training to the way that people learn today. Right. So they’re digital natives and making it digital first, but still having the human checks and balances and validations. 

 

04:40 — Anthony Presley: 

Right. 

 

04:41 — Deric Rosenbaum: 

And you know, it really depends on the team member where you are. Front of house is trained differently than the back of the house and. 

 

04:47 — Anthony Presley: 

Right. 

 

04:47 — Deric Rosenbaum: 

You know, back of house is about precision, execution, speed, and providing the pride on the plate. Okay. 

 

04:53 — Anthony Presley: 

I like that. 

 

04:53 — Deric Rosenbaum: 

In the front is, you know, the pride in the service. Right. And you know, as I mentioned, we’re pretty tech savvy and kind of my overarching goal right now and with the tools and the products and the partners that we’re using is to automate some of these mundane and repetitive tasks and allow our managers and key people to spend more time focusing on bringing the human part back into hospitality. So spending more time with their teams and spending more time coaching instead of tracking down inventory errors or working on cost of goods through, you know, whatever. So we’re doing a lot of stuff around predictive inventory and automating, you know, laboring and schedule. But in automating, labor is a kind of a delicate thing. 

 

05:38 — Anthony Presley: 

It is. 

 

05:39 — Deric Rosenbaum: 

A lot of people are like micromanaging PNLs, especially with labor, and that’s not something I’m necessarily interested in. 

 

05:45 — Anthony Presley: 

Yeah. 

 

05:46 — Deric Rosenbaum: 

Because it’s hard to retain people if they’re working in 15 minute equim. 

 

05:50 — Anthony Presley: 

That’s right. That’s exactly right. 

 

05:51 — Deric Rosenbaum: 

Yeah. 

 

05:52 — Anthony Presley: 

Yeah. 

 

05:52 — Deric Rosenbaum: 

So it’s a delicate balance. And you know, taking that feedback and learning and evolving and. 

 

05:58 — Anthony Presley: 

Yeah. 

 

05:58 — Deric Rosenbaum: 

You know, we try things and then you fail forward and build on those experiences. And that’s kind of where we are today. 

 

06:04 — Anthony Presley: 

Yeah. 

 

06:05 — Deric Rosenbaum: 

Yeah. 

 

06:05 — Anthony Presley: 

It’s interesting. I was talking with someone we both know a couple of days ago and I was, were talking about cutting labor and how the labor, you know, these models predict it and then you want to cut some labor and change it. 15 Minutes. Similar kind of conversation. But I was just remarking to him, like there are not very many industries that, like, when times are tough that you go, you know, what I should do is just take all my salespeople and not have them work. 

 

06:30 — Deric Rosenbaum: 

Correct. 

 

06:31 — Anthony Presley: 

Like. 

 

06:33 — Deric Rosenbaum: 

They’re, they’re literally delivering the experience. 

 

06:35 — Anthony Presley: 

They’re. They are the reason everybody comes back in. Correct. And it’s like, oh no, we shouldn’t have them. Let’s take the hospitality out of the hospitality. 

 

06:42 — Deric Rosenbaum: 

Correct. Correct. 

 

06:43 — Anthony Presley: 

So, yeah, it’s a. But it is a delicate balance. There is a budget, there is a P and L and I know that you’ve been doing some interesting things on the training side and how you maybe approach knowing who and what needs to be in the store and new LTOs and that kind of stuff. Could you talk a little bit? Because that all wraps around AI Right. And could you talk a little bit about where you Think the AI is going as it relates to team members? 

 

07:12 — Deric Rosenbaum: 

Absolutely. I mean, I think, you know, especially for a brand as old as we are, we have a lot of institutional knowledge. Right? 

 

07:19 — Anthony Presley: 

Yeah. 

 

07:20 — Deric Rosenbaum: 

A lot of it’s on paper. Yeah. And you know, over the years we built best in class for the time. Right, right, yeah. So from paper training manuals to kind of intranets to sort of resource sites to somewhat structured Google Drive. 

 

07:36 — Anthony Presley: 

Right, right. Yeah. 

 

07:38 — Deric Rosenbaum: 

But now we live in this world of text to SQL. That’s what I, you know. 

 

07:41 — Anthony Presley: 

Right. Yeah. 

 

07:41 — Deric Rosenbaum: 

You can literally query anything. Yeah. My team and I just finished a massive project and we basically rebuilt our entire knowledge, 30 years of data knowledge base and restructured it to work with agentic tools. So went in and did all this tagging and meta tagging and chunking these documents so these agents can read it, building in conical name nomenclatures and cross referencing this document to that document. And then, you know, you still have to spend a lot of time testing these things. 

 

08:12 — Anthony Presley: 

Right? Yeah. 

 

08:13 — Deric Rosenbaum: 

But you know, it’s like anything else, it’s garbage in, garbage out. You know, quality data in, quality data out. 

 

08:19 — Anthony Presley: 

Right. 

 

08:20 — Deric Rosenbaum: 

So you have to take the tools that are available us to now and evolve what you’ve done in the past and making. So for us, we just deployed a new system called Grouchos. So it’s Grouchos, Grouch os. 

 

08:33 — Anthony Presley: 

Yeah. 

 

08:33 — Deric Rosenbaum: 

And we’ve got a couple agents that we deployed in there. One’s API, so he’s strictly operations. 

 

08:38 — Anthony Presley: 

Okay. 

 

08:38 — Deric Rosenbaum: 

And then we launched another one called Ali. And Ali handles product nutrition and allergens. 

 

08:44 — Anthony Presley: 

Okay. 

 

08:45 — Deric Rosenbaum: 

And somebody’s like, well, why can’t they both do the same thing? And they can. 

 

08:48 — Anthony Presley: 

Yeah. 

 

08:49 — Deric Rosenbaum: 

But Ally will ultimately become a public facing tool as well. So you know, somebody asked, is XY ingredient in a Kaiser role? We can literally pull up a product statement with one simple query and it’s right there. So it empowers your teams to know that they have the knowledge readily available to them and they’re getting accurate answers. 

 

09:10 — Anthony Presley: 

I think that’s important, Right. 

 

09:12 — Deric Rosenbaum: 

That last little bit accurate answers. And then with most of these tools now they have back end analysis so you can see when it’s not or if it doesn’t know the answer. And then we built in mechanisms where they can report these things as well. 

 

09:25 — Anthony Presley: 

Okay. 

 

09:26 — Deric Rosenbaum: 

But the win was synthesizing the data so the agents can actually engage with it in the way that AI architecture is designed. 

 

09:37 — Anthony Presley: 

Right, right. Yeah, yeah. You and I were both at the Google Influencer event a couple days ago and saw some pretty exciting things there, including drone delivery, which was pretty impressive. Yeah. So I’m just curious. I mean, we’re talking about a workforce right now that’s in your store. You’re working with some transitional jobs. Right. High school to college. Moving on. How do you approach, I mean, do you kind of have to market to the workforce force and say you’re in your local community, we’re going to train you with these skills. Is that a constantly evolving conversation? 

 

10:10 — Deric Rosenbaum: 

I mean, I think so. And taking feedback from your restaurant operators and you know, what are the requests and what are the demands? And I think one luxury we may have that other brands don’t have is, you know, we. We serve four generations of customers in our mothership markets. Right. And so, I mean, we literally. My daughter works for me on the weekends. Right. She’s sophomore in high school and one of her friends applied, which plays softball with. And her mom actually worked for us when she was in college. So we actually have now second generation team members. That’s fantastic. But all that’s to say is, like, when you get ingrained in a community. Right. 

 

10:50 — Deric Rosenbaum: 

And become established in people’s lifestyles and routines, like, I don’t want to feed you an STP dipper every day, but I want to be part of your weekly routine. 

 

10:58 — Anthony Presley: 

Right, right. 

 

10:59 — Deric Rosenbaum: 

I mean, that’s the goal for all of us. We want to be part of your routine. And, you know, kids want to come work for us. Like, they want to experience that because, I mean, we’re not this rigid, hard environment. And, you know, I think hospitality and retail is a great way to segue into dealing with the general public. Right, right. It’s a crash course. Yeah. I’m not gonna tell you what my daughter said on the first day after. 

 

11:25 — Anthony Presley: 

Her first shift, but. 

 

11:28 — Deric Rosenbaum: 

She, she was like, you were right. Yeah, yeah. 

 

11:30 — Anthony Presley: 

All these stories I’ve heard from you, dad, this entire time. Yeah. You were right. It turns out you were right. 

 

11:34 — Deric Rosenbaum: 

Yeah, yeah. 

 

11:35 — Anthony Presley: 

That’s hard for kids to say. Turns out. Yeah, yeah. 

 

11:37 — Deric Rosenbaum: 

Especially when they’re 16. 

 

11:38 — Anthony Presley: 

That’s right. That’s exactly correct. Yeah. Yeah. You’ve talked about this transitional kind of roles. One of the things that we hear about is like how. How operators, how leaders within hospitality can instill leadership in their own people. That. I mean, it is a soft skill. Right. 

 

11:56 — Deric Rosenbaum: 

And it’s. 

 

11:57 — Anthony Presley: 

And so I’m just curious if you’ve got somebody on your team who’s starting on the ground floor and they’re just starting at Grouchos. And they’re working their way up. How do you tell them, hey, you want to be a leader, you want to be a CEO, you want to be, you know, whatever it is in life. How do you become that? When you’re the person slinging a sandwich. 

 

12:13 — Deric Rosenbaum: 

Or working the grill, it’s about empowering them and giving them the confidence and the skill sets and the knowledge to do these things and the permission to fail. I think failure is very important to learning. And you know, I like to say we fail forward. 

 

12:29 — Anthony Presley: 

Yeah. 

 

12:29 — Deric Rosenbaum: 

And, you know, that’s how you ultimately learn and evolve. And so giving people the space to do that, obviously. Clear guardrails. 

 

12:38 — Anthony Presley: 

Right, Right. 

 

12:38 — Deric Rosenbaum: 

Yeah, yeah. 

 

12:40 — Anthony Presley: 

We’re not sharing pink poodles today. 

 

12:41 — Deric Rosenbaum: 

It’s not happening. 

 

12:42 — Anthony Presley: 

Yeah, yeah. 

 

12:43 — Deric Rosenbaum: 

So clear guardrails and, you know, mentoring, like, I mean, I guess it’s hard for me now because I’m really not in the day to day of the store, like that level of training anymore. I’m more, you know, but I mean, half of my team is all under 30. So like instilling work ethic and a sense of urgency, and those are two very hard things to instill in a human if they don’t naturally have them. 

 

13:10 — Anthony Presley: 

Right? Yeah, yeah. 

 

13:11 — Deric Rosenbaum: 

Especially a sense of urgency. 

 

13:13 — Anthony Presley: 

Yeah. 

 

13:13 — Deric Rosenbaum: 

And like when I’m in restaurants, especially during store launch and like the thing I say all the time is move with purpose. 

 

13:20 — Anthony Presley: 

Okay. 

 

13:20 — Deric Rosenbaum: 

Move with intention. 

 

13:22 — Anthony Presley: 

Right. 

 

13:23 — Deric Rosenbaum: 

Be intentional. Like there’s no such thing as perfection. 

 

13:26 — Anthony Presley: 

Right. For me. 

 

13:27 — Deric Rosenbaum: 

And I guess the ultimate thing we try to instill is just the pursuit of excellence things. Let’s be the best at what we do with the skills, the tools and the things that are available to us. 

 

13:37 — Anthony Presley: 

Right. 

 

13:37 — Deric Rosenbaum: 

Then apply the kindness of humans to hospitality. 

 

13:41 — Anthony Presley: 

Right, Right. 

 

13:42 — Deric Rosenbaum: 

Kindness goes so far. Like unbelievably so far. Yes, yes. I mean, anyone that’s studied customer service and the service recovery paradox, like, it’s true. 

 

13:52 — Anthony Presley: 

Yeah. 

 

13:53 — Deric Rosenbaum: 

Like, they’re much more likely to be a much more valuable and long term guest if they had a horrible experience and you provided an amazing recovery. 

 

14:01 — Anthony Presley: 

Right. 

 

14:01 — Deric Rosenbaum: 

So, you know, now we have tools to do that both digitally and within the four walls of our restaurants. Yeah. 

 

14:07 — Anthony Presley: 

No, that’s fantastic information. I appreciate you spending the time with me today. Do you have one last hot seat kind of question? 

 

14:13 — Deric Rosenbaum: 

Hot seat, Hot seat. 

 

14:14 — Anthony Presley: 

Let’s just pretend that you’ve got to advise somebody who just got an operations role. This, it’s a brand. Could be a small, medium, large. They are new in their role. It’s their first day. What would you tell them, hey, this is what you should do to make an immediate impact. What’s the, what’s the first thing they should be looking for? 

 

14:33 — Deric Rosenbaum: 

It’s a biased question. 

 

14:34 — Anthony Presley: 

It is 100% so biased. 

 

14:37 — Deric Rosenbaum: 

Like, I’m an observational learner. 

 

14:39 — Anthony Presley: 

Okay. 

 

14:40 — Deric Rosenbaum: 

And I think you need to understand, like, just take pause. Like, don’t come in guns blazing. Right, Right. You can’t do that because it’s never going to be well received, whether it’s teams or micro teams or just walking into a franchise, burning the political. 

 

14:54 — Anthony Presley: 

Capital right out of the gates. 

 

14:55 — Deric Rosenbaum: 

Yeah, I, I think you have to observe, master whatever it is, because no one’s. If you’re day one and you don’t know all the nuance of the brand or even how to make half the menu items, like, you don’t really have a lot of credibility. Right, Right. So I, I think you have to, like, not really prove your salt, but just get in there, learn it, learn the culture, and then slowly begin this metamorphosis process and, you know, find out what are the non negotiables. Every brand has non negotiables? Yeah. Every brand. 

 

15:27 — Anthony Presley: 

Yep. 

 

15:28 — Deric Rosenbaum: 

So learn those things and just do things with purpose and intention. Love that. Love that. 

 

15:34 — Anthony Presley: 

Well, thank you so much for hanging out. I know you’re busy guy. Anthony, I’ll let you get to your day. 

 

15:38 — Deric Rosenbaum: 

As busy as you.