Mission: To expand the Aquilini Group’s restaurant holdings
Assets: A lifetime in the food business
Yield: Head of a company that operates 44 franchise restaurants
By Glen Korstrom
Mike Cyr is the point man for the Aquilini Group’s restaurant expansion aspirations.
The president of Aquilini’s PH Restaurants LP oversees 44 Pizza Hut restaurants in B.C. and envisions PH Restaurants buying Pizza Hut franchises in other provinces. He’s also hungry to buy blocks of other restaurant chains if the price is right.
Former Boston Pizza CEO Mike Cordoba is Cyr’s mentor. Cordoba’s RAMMP Hospitality Brands Inc. bought the 19-location Mr Mikes Steakhouse and Bar chain in February. That multimillion-dollar deal followed RAMMP’s acquisition last year of the 18-location Pantry Restaurants chain.
Cyr and Cordoba worked together for 11 years at Boston Pizza.
“You don’t get to buy a scale business very often. I think that’s what Mike would say about Pantry and Mr. Mikes,” Cyr told Business in Vancouver February 11 between bites of pasta at an East Vancouver Pizza Hut.
“You can buy one or two restaurants and try to grow that to 50, but you don’t get many opportunities to buy big chunks of restaurants all together.”
Buying a “chunk” of a restaurant chain was what Aquilini Group principals did in October 2006 when franchisor Yum! Brands Inc. (NYSE:YUM) wanted to unload 37 Pizza Hut restaurants in Metro Vancouver and on Vancouver Island.
With many of its B.C. pizzerias needing renovations, Yum!, the world’s largest restaurant company, wanted to exit the restaurant operations business. But the Kentucky-based giant was willing to wait until it found a new owner that had deep pockets.
Enter Vancouver’s Aquilini Group, which manages dozens of hotels and has real estate holdings as diverse as the Vancouver Canucks, Golden Eagle Golf Club and about 5,700 acres of farmland.
After closing one of the original 37 B.C. Pizza Huts that Aquilini bought from Yum!, Cyr opened several more and in 2008 negotiated the purchase of six Interior B.C. Pizza Hut restaurants from T.J. Grewal, who still owns Prince George’s Pizza Hut franchise.
Cyr plans to open several new Pizza Huts by mid-2012 and is scouting Yaletown, Abbotsford, Mission and other potential locations.
Recent Pizza Hut openings have been in Nanaimo, Kamloops, Langley and Vancouver’s west side.
Storefronts, however, are less important than they used to be.
About 15 years ago – long before the rapid rise of chains like Cactus Club, Joeys and Earls – about half of the sales at B.C.-based Pizza Huts came from customers who ate at the restaurants.
Today, delivery makes up half of all the chain’s business. Another 25% comes from customers picking up orders. That leaves only a quarter eating in Cyr’s mostly refurbished joints.
The delivery business has also grown for competitor Boston Pizza International Inc., but owner Jim Treliving said it accounts for a comparatively small 8% to 15% of revenue for most of his company’s restaurants.
Treliving hired Cyr as director of marketing in 1993 when Boston Pizza had 84 restaurants. The chain grew to 173 stores by the time Cyr left in 2003 as executive vice-president.
“We knew that he wanted to move up and be his own boss at one point, but we weren’t in the position where he could do that,” Treliving said.
“Mike was head of marketing for years, and we had a good run with him. We had lots of good times together, although I can still beat him at golf.”
Cyr’s Boston Pizza experience provided many lessons on how to effectively run PH Restaurants, but the two are different businesses.
Boston Pizza is a franchisor; PH Restaurants is a franchisee of Yum!
Franchisors invest in the brand; franchisees invest in core assets and restaurant operations.
Working with Boston Pizza franchisees also gave Cyr insights into some of the main reasons franchisees fail.
They include:
- being undercapitalized;
- hiring the wrong managers; and
- failing to institute the right controls to retain profit.
He said that being respectful of employees and compensating them fairly is also a key strategy for franchisee survival.
When Cyr started overseeing Pizza Huts in late 2006, he benchmarked wages for store management against Panago, Domino’s Pizza and other competitors. The result was an immediate 7% across-the-board wage hike for Pizza Hut managers.
Born in Ontario, Cyr cut his teeth in the food business in 1979, soon after he graduated with an MBA from McMaster University.
Labatt Brewing Co. Ltd. hired him in Ontario but soon transferred him to B.C. and the brewer’s Columbia Brewing Co. division, where he marketed Kokanee, Budweiser and John Labatt Classic.
“We grew Kokanee beer to be the No. 1 beer status in B.C. and took it across the border into Alberta and Saskatchewan,” he said. “We were the first beer to cross provincial boundaries.”
Cyr’s tenure ended in 1991, when the brewer, which is now part of Anheuser-Busch InBev (NYSE:BUD), decided to consolidate its Canadian marketing efforts in Toronto.
That was when Treliving recruited Cyr through a corporate head hunter.
Cyr left Boston Pizza in 2003 to work as an independent consultant for a variety of companies, including White Spot Restaurants and Pender Health Management.
After helping Pender Health acquire Care Point Medical Centres and turn it around, Cyr negotiated a transaction to sell Care Point to CBI Medical, a large company that operated 90 clinics across Canada
Cyr sits on Juvenile Diabetes Research Foundation Canada’s (JDRF) national board of directors and is a voluntary leadership chairman for the organization’s B.C. chapter.
Treliving said Cyr is the main reason that Boston Pizza is active with the JDRF.
The involvement is personal for Cyr because one of his sons has diabetes.
“It’s an easy charity to be involved with,” Cyr said, “because the shared passion from the volunteers gives me a tremendous sense of energy.” •