We had the opportunity to sit down with Thomas Nguyen, CMO and Partner at Peli Peli, to talk about the restaurant business and how they are able to expand in a down market.
Pardon any typos below, this is a quick transcript of the interview.
Matt Register: Hey guys, welcome back to Texas Business Radio. Restaurants are a big business in Texas. Restaurants are big business everywhere, especially in Texas, especially in Houston.
Houston is now getting a reputation as one of the best places to go out and eat in the country. That’s something that’s fairly new and something that we’re particularly excited about. We’re going to continue to bring you some of the best restaurants in the state. I’m your host Matt Register, here as always with Jay Curry. Jay talk to me.
Jay Curry: Well Houston is getting such a reputation for outstanding dining out opportunities and choices. But also we’ve got this oil thing going on that’s putting stress on an industry that’s based upon discretionary dollars. So we have in the studio a very successful, even in this tough time, restauranteur. It is going to be fun.
Matt Register: Absolutely it is. Go ahead and get your questions in 8 4 4 8 1 4 8 1 4 4. It’s a 24 hour call on line. Get your calls in. We’re going to get your questions answered. Let’s jump right into it. In Texas, there are a couple of companies that despite everything going against them, despite the oil downturn, despite a lack of discretionary income for a lot of their customers, continue to find a way to expand, and expand rapidly, even in this time. Peli Peli is a fascinating, fast growing restaurant chain here in Texas that serves, of all things, South African cuisine. Thomas Nguyen, joining us here in the studio, is one of the partners and the CMO of Peli Peli. Thomas welcome to the show.
Thomas Nguyen: Guys thanks for having me. It’s a pleasure.
Matt Register: Well tell me a little bit about Peli Peli. I have eaten your food. It is absolutely delicious.
Thomas Nguyen: Thank you.
Matt Register: I didn’t even realize South African food was a genre of food. Tell me more.
Thomas Nguyen: So a lot of people have never had South African food before, myself included until I met Chef Paul Friedman. And what we’re trying to do is just bring something new to the market. I think, well with the advent of the Internet and TV, people are just more educated, they’re more adventurous, and especially in Houston very progressive and they’re looking for new flavors and new things to eat. And it’s it’s an honor to be part of the Houston restaurant community and be able to bring new flavors that people haven’t had before.
Matt Register: Well, I’ll tell you what, it certainly is. You know when when people look at your menu and want you describe a little bit about what some of this stuff is it’s definitely things that I’m not sure I would have thought of. But the but the food is very very good and is something that that you haven’t had before. Tell us a little bit more. What do South Africans eat?
Thomas Nguyen: At the heart of it our restaurant is trying to do two things. One is taking authentic South African cuisine and making it more presentable and more appealing to the American palate. Paul’s been an extremely good job with that and the other part is we have fun. We take steak chicken and seafood and we give it a different flavor profile and using different marinates, seasoning, spices such as the piri piri pepper which is what we’re named after right. It was a spice founded by the Portuguese in South Africa. Very popular chicken and see if we can use it we tone it down a bit to enhance the flavor I suppose is focusing on the spice. So we give people items that they’re familiar with. We have wings. We have chicken fried steak. We have steaks and sea bass but we flavor them different. Just a little twist people enjoy it but the pleasure to see is also, South Africans have really embraced us. Authenticity is crucial to any restaurant opening these days. And I love, Paul especially loves those South Africans they come in they get biltong they get sosoities, bouraours, BaBooty and they really enjoy it. These are some of the things that they haven’t had since they’re a child. And it’s it’s cool that we’re able to bring that to the market for that.
Matt Register: So well in the fine dining space is especially hard hit. It is more cyclical than normal whenever you have a downturn it’s more sensitive than that than others. Because again this is all discretionary dollars that people are spending up with you. You guys are not having the same effect on your company that a lot of these guys are seeing. Talk to me a little bit about why that perhaps is.
Thomas Nguyen: Well fortunately when we started we wanted to kind of we wanted to create something what we call upscale casual and especially in Houston to very casual comfortable environment. And sometimes people they say they want great food they want a great environment but they don’t necessarily want to spend as much money or have to dress up every time as well. Should you go into our restaurants at any time even in the galleria you’ll see a really good mix. I mean you’ll see people in suits. Well you’ll see people in jeans and a nice dress shirt some people will come in shorts and a polo. It’s a very casual environment. It’s not white tablecloth. We are a step below the high end restaurants like we’re next door to Del Frisco’s and some other nicer high end restaurants. We like to think that we provide a similar dining experience and quality of food quality.
Jay Curry: For sure. I think I’ll outstanding.
Thomas Nguyen: But in a different more casual environment.
Matt Register: And the price point is a step down as well. I mean you’re not necessarily paying those prices but you’re but you’re getting the quality of food.
Thomas Nguyen: That’s right. Our like our plates a lot of places what some places charge for steak we will charge for steak and then that includes two sides. So your whole meal is taken care of and that difference will make a big deal especially in a downturn. Yeah.
Matt Register: No. Understand. So three locations in the Houston metro area. Three more on the way. That’s that’s that’s a lot. Right? I mean that’s I think you described it during your break as hyper aggressive in the market. Walk me a little bit through that because I you know as we talked during the break and I well understand what you’re talking about it makes all the sense in the world. But but there’s some risk associated with that.
Thomas Nguyen: Absolutely. Absolutely. And we’re in the middle of our journey. So by no means, we have a long way to go. So you guys pray and hope for us because we’ll need it for sure. But we’ve we opened in 2009 and it was about six years before we opened our second location. So by no means is this a you know overnight success. We’ve been grinding this up for many years and it’s taken quite a bit of time to really develop the passionate following that we have. But we have a great team. Our secret sauce is our culture. We spent many years and a lot of resources building that out. We think we have an infrastructure to support the growth that we have. But like you said it’s it’s a risk and I’m hope I’m able to tell a successful story. You know a year from now but you know Galleria has done well. vintage Park took some time but it’s doing very well. Peli Peli kitchen, our first fast casual model, we were on restaurant startup CNBC to promote that concept and we were able to actually do it. People really embraced it. A lot of our flavors and a lower price point everything’s under $15.
Jay Curry: That’s in downtown Houston?
Thomas Nguyen: That’s on Katy Freeway at Campbell and I-10 open about three months ago. The response from the community has been great. Very encouraging and we have three more in line. We have the downtown location at the Espersen. It’s a baby kitchen. It is you know trying to bring something new and fresh and exciting to downtown.
You know we have to flagships coming online. One in my hometown Katy Texas and La Sentera hope opening hopefully in April and then we have that. What really scares me but I’m excited to is to go outside the city. You know you see a lot of restaurants from Austin coming into Houston. I’m glad to represent Houston coming to Austin. We’re going to be opening in downtown Austin, 3rd and Colorado, next to the W. That’s going to be our flagship and I hope that Austin embraces us as well.
Matt Register: Well I’ll tell you what. Good. Good for you. And we are excited for you. You know we talk all the time on here that you have to take the opportunity during a downturn and build the company you want to be during the next upturn. Right? That is very easy to do and console very hard to do in practice because you find yourself financing-wise in a tighter environment. And you know it’s just very hard to do but the people that actually will do it will find himself able to take advantage. And like we were talking during the break I mean you got an opportunity for some very very prime real estate that’s not going to be available when everything starts coming back right. It’s available right now and you either jump on it take advantage of it or you don’t.
Thomas Nguyen: That sounds right you know for us our philosophies. It’s crazy. You know two of us are Iron Man. I mean you know Michael Tran’s done seven. I’m going two he’s run 100 miles before I have done 50 and what we learned is sometimes if you believe in a concept set the goal and then you’re going to be forced to make it happen. And I know a lot of people don’t agree with that. Maybe I am crazy. But we believe in what we’re doing. We’re encouraged by our customer base. I think the market is going to support this and where we’re doing or dying by this is my whole livelihood. I’m willing to put it on the line for this because I believe in it. It’s the spirit of entrepreneurship right.
Jay Curry: Is having a lot of success.
Matt Register: God bless America. Thomas when is the partner in CMO of Peli Peli restaurants. South-African. Guys if you haven’t had South African food go try it out. I have a lot of it. It is outstanding pelipeli.com is the website PeliPeli.com.
We’re going to have that link right from Texas Business Radio. Thomas thanks very much for joining us.
Thomas Nguyen: It was awesome. Thanks for having me.
Jay Curry: Congratulations.
Matt Register: Guys TexasBusinessRadio.com that you will see links to all of our guests. If you missed anything. See the entire thing a beautiful HD video. We got to take break. We’ll be back.
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In addition to hosting "Texas Business Radio," Matt is an investment banker and serial entrepreneur from Montgomery, Texas. He is the owner of RREA Media and Register Real Estate Advisors and a Managing Director and Principal at Corporate Finance Associates. He has a BS from the United States Military Academy at West Point and an MBA from Rice University in Houston. You can read more about Matt HERE.