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Ed Doherty’s vision is woo them and wow them

July 3, 2012

By Staff Reporter

When Ed Doherty was a boy, his mother just wanted him to get a steady job. She could hardly have guessed the job he would have: that her son would grow up to be Chairman and Chief Executive Officer of Doherty Enterprises, a multimillion dollar restaurant business spanning New York and New Jersey.

Born in Brooklyn, Doherty grew up mostly on Long Island. His mother was German, his father from Donegal, but his parents got divorced when he was two years old.

“My mother’s goal in life – because I was an only child with a single mother – all she wanted was for me to finish college because nobody in the family had finished college and go work for a big company for the next 40 years of your life and then retire,” Doherty said in a slight New Jersey accent when we spoke over the phone. During high school and college, Doherty worked 40 hours a week in his mother’s deli. He studied marketing at St. John’s University in Jamaica, Queens, and then went to work for Mobil Oil Corporation.

This was in 1968. For his first job, Doherty was posted to the area of Bedford-Stuyvesant and East New York. His task was to call on gas stations, collecting rent, selling the dealers spark plugs and other products, and making sure everything was in order.

Race riots were common in those sections of the city at the time, but at 21, Doherty said he “did not realize that I was supposed to be frightened in those areas. My dealers were lovely people, hardworking African Americans trying to get ahead.”

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He became a leading sales person and was promoted, moving into Mobil Oil’s real estate sector. But in 1973 the oil crisis hit, and with people waiting in line at gas stations, nobody wanted to build new ones. Doherty took a job in the real estate division at Burger King, and two years later was recruited by the Marriott Corporation.

Within Marriott he was able to explore the area he really wanted to work in – operations.”I enjoyed interacting with people,” Doherty explained. “And in operations you’re really dealing with both your crew people and the guests that come into the restaurant.”

Initially, he was in charge of 200 restaurants, and later, when he became Vice President and General Manager of Marriott’s family restaurant division, 1,200 restaurants. His role was to oversee staff in a chain owned by Marriott called Big Boy restaurants, making sure they delivered good food and service.

By 1985, however, Doherty had had enough of big corporations and decided to strike out on his own. He purchased 19 Roy Rogers restaurants from Marriott Corporation and became a franchisee. Roy Rogers hadn’t been doing very well and the restaurants were relatively cheap – just $1 million.             “I went into business in June of 1985, and borrowed $1 million from a bank and had to sign personally for it,” Doehery recalled.

He and his wife took out their life savings of $60,000 and used it as their working capital. Doherty had met his wife, Joan, on St. Patrick’s Day 1975 in an Irish pub called Rumm’s, which was on 50th street off 3rd Avenue in Manhattan. He was sitting at the bar when she walked in, and they started talking. They’ve been together ever since and have three children, Timothy (34), Shannon (32) and Kerry (27), all of whom now work in the business.

Things went well and over the next five years; sales doubled. But then Marriott sold the brand to a southern firm called Hardee’s. Hardee’s stopped developing new products, cut advertising for Roy Rogers restaurants, and Doherty watched as the sales at his restaurants slumped.

He was struggling to repay his loans. “At that particular time I owed $4.5 million,” he said, “and I knew I couldn’t pay the money. So I went to the bank and I said to the banker, ‘You see my sales are going down. You get my financial statements. We need to restructure the loan.’ The banker said, ‘You’re current, we don’t restructure loans for people who are current.'”

So Doherty stopped paying. After three months the bank called him. He agreed to sell all his restaurants to competitors and wound the business down, though he ensured that his employees would be kept on at the same salaries.

It sounds rather stressful, but recalling the period, Doherty laughed.

“When you’re dealing with somebody who works for a big corporation, it’s just a job for them so they want to do the best they can but it’s not life and death. So you can get some very serious negotiations – where it’s life and death for you but just a job for somebody else. I was able to put together a plan to convince them to negotiate a reasonable settlement with me so that I could be successful in paying back what we agreed to.”

As soon as he had sold the Roy Rogers restaurants, Doherty embarked on a new endeavor. In 1993, he opened his first Applebee’s, and then another. His mission was to run the best restaurant company in the tri-state area.

“I created a vision,” he told the Echo. “And the vision was wow: wow every guest every time. Wow our people. Wow our communities, wow our suppliers. Okay is not wow.”

He explained: “when you come into any of in one of my restaurants, when you come into the Shannon Rose Irish pub, I want you to taste the food, I want you to taste the shepherd’s pie, I want you to taste the coffee, or the hamburger and say, ‘Wow, this is really, really good food.’ I want the hospitality from our hosts or our servers or our managers to be so warm, so friendly and so attentive that you go, “Wow, these are really really nice people. I want to come back here.'”

The hospitality business gives employees a great education, Doherty suggested.

Many of his employees are young, and they learn teamwork, how to deal with people, and how to sell.

“You have to learn how to smile at people and try to satisfy them even if that person is in a bad mood,” he explained.

“There is no better business for people to work in than the hospitality business, because you learn so much.”

As of April this year, Doherty’s restaurant empire was extensive: 61 Applebee’s restaurants, 30 Panera Bread Bakery Cafes, two Chevys Fresh Mex, one Spuntino Wine Bar & Italian Tapas restaurant, and three Shannon Rose Irish Pubs (named after his middle daughter).

Projected sales for 2012 are expected to exceed $315 million.

At 65, Doherty loves to travel and has no intention of retiring. He works six days a week and over the next five years, plans to open four to eight restaurants per year. Then he will take stock.

“I have a passion for this business,” he said.

Doherty owns 97 restaurants and on a recent day he vowed to visit all of them in just over a month. And he did.

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