"Everything we could have done wrong, we did," says Adam Romo, CEO of Eatzi's.
The Dallas company, known for its prepared meals and opera music, is now in its third stage of growth after Eatzi's 1.0 and Eatzi's 2.0 were, frankly, a "disaster" outside of the Lone Star State, says Romo, who has been the CEO since 2011.
With hindsight 20/20, Romo and his team are opening two new Eatzi's markets in 2017: first in Fort Worth on May 11 and second at Preston/Royal in Dallas the fall.
Someday, he believes "this thing will work all over the country." It's a bold statement, given that the 21-year-old company shuttered Eatzi's stores in Manhattan, Atlanta and elsewhere near the turn of the millennium.
Romo thinks Eatzi's finally has it figured out: "For now, the smart expansion is, you start looking in Houston and Austin and San Antonio. Once you've kind of maxed out or have grabbed all the great real estate spots, you look outside of Texas," he says.
What didn't work
Today, Eatzi's still operates its original shop, there since 1996, on Oak Lawn Avenue in Dallas. Eatzi's has also sprouted stores in Grapevine, West Plano and on Lovers Lane in Dallas. With the opening of the Fort Worth Eatzi's on May 11, you'll notice a trend: Today, all of the existing Eatzi's are in Dallas-Fort Worth.
Keeping restaurants close in proximity makes it easier for company employees to monitor quality and growth, Romo says.
Romo now knows the expansion plan in the late '90s — when he was the CFO of the company — was "the riskiest and most complex" possible. Eatzi's expanded rapidly to Houston, Atlanta, Washington, D.C., and to two locations in New York City.
"We thought we needed to go to all the major markets, then fill in with secondary stores," Romo says.
You can guess what happened.
Each store was a little bit bigger than the last. One was tucked into a basement in New York City. Parking was bad. Labor was expensive. Alcohol laws were weird. The New York stores started failing, Romo recalls, and the Eatzi's brand went down, fast.
In the early 2000s, after the company had been sold to private equity firm Castanea Partners Inc., the second round of mistakes took place. Eatzi's did not work inside a mall in Chicago, they learned. And it doesn't double as a grocery store; Eatzi's competitive advantage was its prepared food.
"I don't think anybody anticipated Eatzi's downfall as quickly as it did," Peter Repak, an operating partner with the Chicago store, told The Dallas Morning News in an article by Karen Robinson-Jacobs in 2007. He offered this omen back them: "The old company is dead. It's gone."
Dallas entrepreneur Phil Romano, who helped launch Eatzi's in the '90s, got involved with the company again in the mid-2000s by buying the Oak Lawn store.
The company needed a new plan, and fast.
Romano, Romo recalls, reiterated: "There's nothing good about just trying to be fast." (Romano is the man behind mega chains Romano's Macaroni Grill and Fuddruckers, companies whose growth made them successful.)
Eatzi's execs are much more cautious now. In fact, news of a new Eatzi's is rare enough that it can be cause for serious excitement from people who live in the affluent neighborhoods nearby.
Eatzi's biggest fan?
Thalia Sarris Banowsky goes to the original Eatzi's in Dallas four times a day. Sometimes five.
"Every morning, it's my first stop," the lawyer says. Then she goes midday, to refill her cup of peach-mango iced tea. She goes again at about 3:30 p.m. for more iced tea, then when she leaves the office at about 6 p.m. Sometimes, after working out, she'll go back for dinner.
"Honestly I'd be a little off-kilter if I didn't go," she says. "It's part of my routine."
Each time, her cup of tea comes mixed with a half a packet of Sweet'N Low and four lemon wedges. More than an item on her to-do list, her stops at Eatzi's are moments to socialize with staff members, whom she calls friends. When her dad was sick, a manager sent a tray of sweets to the hospital.
"They rallied like a family would," she said of the staff. "I thoroughly enjoy having gotten to know them. I feel like my life is richer for it."
She's one heck of a brand ambassador.
The new Fort Worth store feels like the existing shops, like they've landed on a formula that works: smiling chefs who want to talk about food and walls stocked with cheeses and wines, perfect for a party.
"What I love about Eatzi's is they've really defined themselves," says Wallace Doolin, chairman and founder of TDn2K (Transforming Data Into Knowledge), a restaurant business intelligence company. Doolin has a lengthy background in restaurants as the former CEO of TGI Fridays, La Madeleine and Buca di Beppo Italian Restaurant, among others.
He says it's "tough" to compete with Eatzi's, whose competition is restaurants, not grocery stores. He's also an Eatzi's customer; he finds it convenient and fast.
Eatzi's has always sold prepared food, often beautifully displayed, for people who don't want to cook at home. Romo is still working on its "gourmet" perception: He thinks it's perceived as being more expensive than it really is.
Don't expect Eatzi's stores to open on every corner of every suburb. But do expect the company to try continue to expand.
"We've proven that this thing does work outside of Texas," Romo says, despite the failures in New York City and the closures elsewhere. The difference is he also knows why they didn't work, he explains. (And it'll probably be a long time before Romo and his team take a bite out of the Big Apple again.)
"This thing will work all over the country, and I'm certain we'll be there one day," Romo says.
The new Eatzi's in Fort Worth is at 1540 S. University Drive. The new Dallas store, expected in October, will be at 6025 Royal Lane, in the Preston Royal Village Shopping Center.