Boston Pizza’s Melville & Treliving

Written by ProfitGuide Staff

Co-Chairmen & Co-Owners
Boston Pizza International Inc.
Richmond, B.C.
Ages: Melville, 63; Treliving, 66

Career highlights:

  • In 1968, former RCMP officer Treliving meets Melville, a chartered accountant, and becomes a Boston Pizza franchisee in Penticton, B.C.
  • Melville and Treliving become business partners in 1973, and buy Boston Pizza outright in 1983
  • Their T&M Management Services Ltd. owns a diverse group of businesses, including Mr. Lube and Global Entertainment Corp., whose activities include running the Central Hockey League
  • In 1990, they launch the Boston Pizza Foundation, which has raised $6.2 million for Canadian charities
  • The partners win Pacific region Entrepreneur of the Year award in the Hospitality and Tourism category in 1999
  • Treliving becomes one of the stars of CBC Television’s popular show, Dragons’ Den, in 2006
  • In 2007, Boston Pizza has more than 320 locations in North America and system-wide sales of $756 million

How does Boston Pizza ensure a consistent level of quality and service at its restaurants as the chain grows throughout the world?
Kevin Dow, President
Schulte Industries, Englefeld, Sask.

Melville: The key to that is training. You need to train people, then measure and monitor their success. We have a very extensive training program, which we follow up with local store visits from both operations and marketing people. We also have a rewards program. We measure every restaurant in Canada and give awards right to the staff level. So, everyone is aware of how they’re doing in relation to their fellow franchisees, and the staff get rewards for that—cash, mainly.

Treliving: We have a silent-shopper program as well. We hire people to go into the stores and act as customers, order food and pay, and then they write us a report. That ensures the level of quality and service is kept up.

When you have disagreements when making important business decisions, how do you resolve them in order to move forward? Does one have more say than the other?
Grace Lau, Event Consultant & Emcee
Aqua Event Management, Toronto

Melville: We’ve known each other for 40 years, we’ve been partners for 35, and I think that smells of a basic trust. Because of that trust, you respect the other person’s opinion. If I have an idea and I can’t convince Jim that it’s very good, then it probably doesn’t have a lot of merit and I should probably back off. In most cases, we talk about things, and then make a decision on what’s best for both of us.

My firm is in its fifth year and employs 12 people. We’ve always experienced accelerated growth. To manage effectively in a growth phase, is it better to place emphasis on personnel development or streamlining existing process and systems?
Tim Fox
FoxSafety, Redcliff, Alta.

Melville: We, too, have always experienced accelerated growth. What we’ve found with the personnel side is that when we had 50 restaurants, we made sure to have staff that could service 75; when we got to 100, we had staff that could service 150; and now, we have 300 restaurants but enough staff to service 400. So, make sure you have the staff to manage the future—don’t grow and then increase the staff to manage what you find yourself in. That’s why we’ve been successful over the years: we’ve always hired ahead of the wave rather than behind the wave.

Why did Boston Pizza become an income trust, and have you experienced any of the negatives?
Christina Stamatakos

Melville: It was a great way for Jim and I to unlock some of our equity in the business and yet still own the business. Boston Pizza International is a private business owned by Jim and I; the public vehicle is a top-line royalty trust. That means we have the best of both worlds. Because the operating company is a private company, we can make long-term strategic decisions without being hugely concerned with a public market that wants profits, while the income trust gets rewarded off same-store sales growth and new restaurant openings. So, we can provide the income trust with a growing income and a growing profit to distribute to the unitholders while, in the private end, we are looking to the future and planning without so much of a focus on profit, but more on how we want to manage our business going forward. It’s not that we don’t like profits, but it’s a bit of a different mindset. As far as the negatives go, Boston Pizza International really needs no capital because all of our capital requirements are supplied by the franchisees.

What is the biggest thing that you would go back and change if you could?
Glen DeMara, Assistant VP of Business Development
Willis Canada Inc., Vancouver

Treliving: Maybe taking a little more time to enter the U.S. market. We rushed it a little bit and hit it in one of the toughest times—about two years before 9/11, which changed the country. Besides that, when we went east, from a western-based company to Toronto, we were probably a little under-capitalized because we thought we’d do better quicker. It took a little longer than expected for people to realize that we weren’t just a Pizza Pizza-type takeout place, that we were a full, sit-down restaurant.

What was your single greatest challenge in building a national franchise system?
Michael W. Palmer
Palmco Inc., Calgary

Melville: We have three pillars of success within our business model: continually building the brand, enhancing customer service and, probably the primary one in my mind, franchisee profitability. So, you have to have a business concept that has a great economic model, and then you have to get people believing in that and buying into that system. So, to me, it’s all about getting the trust of an investment group that wants to go in and start their own business and succeed with you. And that’s the biggest challenge: getting out the message of what the brand is, and how an individual can invest both money and time in it to become financially successful.

We have a struggling country restaurant on a major cottage route. Our biggest problem is getting people to stop. Do you have any suggestions that could improve our traffic during the summer months?
Bryan Noyahr
Markham, Ont.

Treliving: I think it’s important to let your customers know when you’re open, what your hours are and to give them an idea what you serve, and you can do that with signage. I’ve seen signs that say “All Day Breakfast” and I drive in and it’s closed, or they tell me, “Breakfast is over at 2 p.m.” Paint your place, make sure it’s clean and looks sharp.

Melville: Consider your customers’ needs—it’s probably speed of service. So, think about access: can they get off the highway and back on quickly? The other thing is children. They’re a major decision-maker in the back seat of any car. If you can attract their attention, you can get people coming in a lot more often.

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