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Published: Monday, August 15, 2011, 12:01 a.m.

Unwrapping the secrets to success for Dick's Drive-In

  • Welcoming the public to the May 19 groundbreaking ceremony of a new Dick's Drive-In in Edmonds, Vice President Jim Spady (center right) introduces Fab...

    Chris Goodenow / Weekly Herald

    Welcoming the public to the May 19 groundbreaking ceremony of a new Dick's Drive-In in Edmonds, Vice President Jim Spady (center right) introduces Fab Fans Ronda Grazen (from left) of Marysville, Aaron Soderland of Redmond, Ruby Reagan of Edmonds and the Spady family, including his father, co-founder and namesake Dick Spady, Dick's wife, Ina Lou Spady and Dick's son, John Spady.

With hamburger lovers eagerly awaiting the opening of the first Dick's Drive-In in Snohomish County this winter in Edmonds, we wanted to learn the secrets behind successful small businesses.
We recently talked with Jim Spady, whose father, Dick, helped create the iconic restaurant chain. Dick Spady and his business partners opened the first Dick's in 1954 in Seattle with a commitment to fresh food, speedy service and affordable prices.
Many fast-food competitors promise the same combination. We wanted to know what made Dick's different.
Jim Spady, who serves as Dick's vice president and legal counsel and leads the company's business operations, said the company's first responsibility is to sustain itself for the sake of its stakeholders.
The stakeholders include customers, vendors, employees and the greater community at large. They all need to be attended to, and none of it can happen with a business that can't turn a profit.
The second responsibility of a successful business is to treat employees and vendors fairly, he said.
We asked Jim Spady to elaborate on how this might look from outside the organization. It turns out, the main ingredient to Dick's success wasn't the beef, buns or hand-dipped ice cream.
"It's our employees," Jim Spady said. "In order for Dick's to be successful, we need for our employees to be successful."
Dick's boasts very low employee turnover, the envy of others in the fast-food industry. Dick's offers a variety of benefits to increase employee retention, including higher than industry average hourly wages, and if they work at least 24 hours per week, they're eligible for 100 percent employer-paid medical insurance.
There is also a 401(k) plan for eligible employees that includes a 50 percent employer match, and eligible employees even receive up to four extra hours of pay per month if they are volunteering with a local charity.
Add to this an $18,000 four-year scholarship program for those who've been with the company at least six months. Of course, the employees still need to log 20 hours per week if they're on a scholarship. Dick Spady has a passion for education and hoped for a plan to help employees, even in an era where tuition is out of reach for many minimum-wage earners.
There is no question that the beef, buns and hand-dipped ice cream are a high priority for the business too. Every restaurant chain will grapple with consistency and product quality. It is vital to deliver a customer experience that meets or exceeds their expectation.
"We maintain a positive working relationship with our suppliers. Many of our vendor relationships are decadeslong, and we don't chase after lower prices, which a new vendor may only offer as a one-time incentive to switch," Jim Spady said.
The third responsibility of a business is to its immediate community.
Dick Spady believes that as the community goes, so goes a business. In practical terms, Dick's provides support to many local charities and also promotes employee participation. The restaurants participate in the United Way Campaign and Dick's matches employee contributions at 50 percent. Customers are also encouraged to get involved through the "Change for Charity" program. Funds are distributed to programs that are targeted at youth development, job training and helping the homeless.
The fourth responsibility of a successful business in Dick Spady's view is to the common good to build toward a sustainable community, his son said. This involves a discipline to care for community regardless of politics or economics.
Dick's made national news last October when the business decided to evaluate an approach for a new restaurant opening. Being entrepreneurial, Dick's opted to use social media to help the company choose its next location.
Dick's used Facebook to create a voting frenzy for customers to select a new location. Customers could vote for one of three regional sites, and of roughly 115,000 votes in an online poll, Snohomish County generated more than 50,000 responses.
Great news Snohomish County: You win! The new Dick's Drive-In is slated to open in November in the Top Foods shopping center at 220th Street SW and Highway 99. The building construction is nearly complete and the finish and interiors are scheduled to be completed soon.
We like what Dick's has to offer, especially how it has encouraged care and concern for its employees. This strategy is often far less costly than hiring at or below minimum wage and then paying for the churn as unproductive, barely trained staff enter and exit through a revolving door. With the realities of the job market, the new Edmonds Dick's Drive-In will have no problem recruiting a talented crew to serve up its renowned burgers, shakes and fries.
Pat Sisneros is the vice president of college services at Everett Community College. Juergen Kneifel is a senior associate faculty member in the EvCC business program. Please send your comments to entrepreneurship@everettcc.edu.

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