Per Austin Biz journal; After retaking the CEO post, Patrick Terry (P. Terry's) talks business strategy for his growing Texas burger chain

 

After retaking the CEO post, Patrick Terry talks business strategy for his growing Texas burger chain (P. Terry's)



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P. Terry's is back at the hands of its co-founder, Patrick Terry, who stepped back into the CEO role in December. Terry and his wife, Kathy Terry, opened their first location in 2005.

P. Terry's Burger Stand

By Sahar Chmais – Staff Writer, Austin Business Journal

Oct 10, 2024

Patrick Terry came back to helm his company, P. Terry’s Burger Stand, as CEO about 1 year ago.

He’s come back in full swing with plans to expand the burger joint into a new area, Houston, and he also expanded the menu to add chicken bites. Originally, the chicken was a temporary offering, but its popularity has made them permanent. The business has also begun sharing some quarterly data to show the company's loyal customer base the health of the business.

"I wanted the customer to know that we were succeeding, that business was good, we were healthy, that we are able to continue doing what we're doing the way we're doing it. And then if any change occurs, they'll be the first to know." he said on the latest episode of the Texas Business Minds Podcast.

Terry brought on a wave of change as he came back to the CEO job, but he also knows when to pump the brakes. In some ways, P. Terry’s is slowing down its expansion, like in Austin where the city can only bear so many more locations. But the business has not slowed down on its employee care, continuing to provide them certain benefits or perks rarely available in the food industry.

And at a time where competitors are raising the cost of a burger, a P. Terry’s hamburger hovers around $3, or about the same price as a milkshake.

On what's different about being CEO this time.

When I came back, first part of December, I had some ideas in mind that had just been kind of rolling around in my head for a while. And so once I took the helm again, we started talking and initiating those plans. For instance, the chicken bites. And so a lot of the things that we did in the first six to eight months really have set us toward the future. And so I don't see a big storm of new ideas in the next year or so, although I will say that as a business, you've just got to be limber, you've got to be versatile, and you've got to be ready to make a move on short notice. And so we're kind of prepared for the next thing, whatever the next thing is. You know, we have people in place that are more than capable of taking the reins.

On keeping profit margins healthy as prices rise.

We're going to introduce a peach flavored iced tea. What we're really trying to do, of course, is drive drink sales, and the more tea we can sell, the better it is for us. Because the truth is, we look at our food costs, and it's a very tricky game right now. The supply chain issues that occurred during Covid did not do us any favors, and we still feel a little of that residual effect. We get a new price on our beef every Friday. We're really not sure what the price of beef is going to be that Friday, and there was a time where we had a pretty good idea — it's going to go up a nickel, it's going to go up a dime, it may go down a little bit. We don't really live in that world anymore, and so we are constantly watching everything that occurs.

So many places will raise prices as a mask, as a band aid to running their business more efficiently. And so we take every expense that we look at, I mean, the staff here, just, I drive them crazy with ‘does it really cost this much to have somebody power wash the restaurant parking lot?’ Because if you've got 34 locations and you're power washing every month, an extra $100 quickly adds up on an annual basis. We really watch our pennies.

Why the big push into Houston?

First of all, we’re on the outskirts. Our first store is in Richmond. We’ll be in that northwest area of Houston. We did that because we have half a dozen stores in the San Antonio area. I think we're good in San Antonio for some time. We have pretty much maxed out Central Texas. There's probably room for one or two here and there as the area continues to grow, whether that's in Hutto or Taylor or Leander, those are the three that kind of come to mind. Houston becomes the next great challenge, and the growth in the city is obviously enormous. Our competition has hundreds of stores there. It is considered a really good market for quick service. It is not that far a drive for us. Our commissary will still be able to produce the food for Houston, and we'll be able to deliver it three or four times a week without too much trouble.

We have an obstacle in front of us, because we have our own commissary. Our kitchen produces a lot of the food. It's served in the stores, and it's delivered every day. So you know, we're not going to be in Denver anytime soon, but we can go to Houston.

One of the ways you keep everyone in your company interested and feeling a part of things is to have some growth, and that also allows them opportunity for promotion and a bigger salary.

What is your busiest location?

At William Cannon, that’s South Austin. Our second busiest location is now in San Antonio and Cibolo, a store that we opened just a couple of months ago. That's been incredibly satisfying.

We are still David and the Goliaths are all around us. We opened in Cibolo, which is just a small community, and we are literally right next door to a giant Chick fil A. And Chick fil A is a strong competitor. In fact, maybe the strongest. And for us to go literally next door to them and become as busy as we have been in the small community is really gratifying. I think that's kind of given us the confidence as we go into Houston that hopefully we'll be able to achieve those same numbers.