Moby Dick – A Whale of a Tale about Building a Cash Cow

The tale you are about to read is not a fish story but an unlikely cash cow. It all starts in a picturesque border town located in Southwestern British Columbia, about 48 kilometers (30 miles) from Vancouver. Located on the ocean, the town, and its main drag feature wall-to-wall restaurants and shops. Our story begins here.

A little fish and chip shop was established in 1975 by a young German immigrant couple, Peter and Claudia on what became the “strip”. They rented and later purchased an old diner when the little town was inhabited by mostly Hippies and cottage owners, not the tourist attraction it is today. The couple lived upstairs with their two little boys. They named their restaurant Moby Dick.

As a necessity, because the couple had no money, they kept with the diner décor. Over time, Peter and Claudia started adding knick-knacks associated with fishing, pictures of family and relatives, and anything else they could find. As the furniture wore out, they replaced the chairs and tables they found in bargain centers. But, of course, nothing matched. Eventually, the little fish and chip shop took on an antique store-like charm where one could spend hours looking at the stuff on the walls.

Claudia ran the front, and Peter ran the kitchen. They had two things going for them – one was a great fish and chip recipe, and the second was Claudia’s 1000 watt smile and effervescent personality. They made a good living and invested in real estate.

In early 2000, Claudia died suddenly of liver cancer. Peter was distraught. The money he invested was sufficient for him to live comfortably for the rest of his life. The story really begins here.

Peter sold the restaurant to Ralph and Monica Oswald, who had owned a restaurant in Ontario. They had been friends of Peter and Claudia. Over the next 14 years, they prospered, doubling and quadrupling sales from the same location, with Ralph running the kitchen and Monica running the front. Service was excellent regardless of how busy it was, and the place ran like a machine. Everyone was always friendly, even on a hot summer day with dozens and dozens of people lined up at the door or for takeout. You could count on quality every time.

After eight years, the Oswalds brought in another couple to share the load and eventually sold their interest to their partners. The restaurant was very successful and Ralph and Monica were able to retire while still relatively young.

One would think that a little fish and chip shop on restaurant row located in a seasonal tourist town with three other fish and chip restaurants in the same block would not be a recipe for success. The restaurant was housed in an old diner with wood panel walls cluttered with knick-knacks and pictures. The shop had only one menu item – fish and chips, although the Oswalds did expand the menu. It succeeded because the original owners Peter and Claudia had stumbled on a recipe for success because of necessity. Being immigrants with no money forced Peter and Claudia to make do with what they had. They traded on the only asset they had, a damn good fish and chip recipe. They had to rely on local and repeat business in the winter months, so they could not afford to let their quality standards slip. Claudia’s sparkling personality was infectious. You just felt good being around her. The little restaurant became known far and wide for its food, friendliness, and zany décor.

The Oswalds understood what made the little restaurant work. With those ingredients, they turned the business into a cash cow. They did this by turning Moby Dick into a caricature of itself. They out Moby Dicked, Moby Dick. The décor became zanier, and they added outstanding seafood items and service was the most exceptional and friendly around. They exploited and traded on the business’s strengths. The Oswalds also systemized every process and could scale the business by standardizing excellence regardless of how many employees they had on staff during the busy times. They did not franchise the business because the unique characteristics of Moby Dick would be hard to duplicate. Instead, they found ways to maximize throughput and output. Regardless of how long the lineup was at the takeout window, you would get your order, fresh and hot, within ten minutes.

The Oswalds hired high school and college kids for wait staff and kitchen help. They were trained and schooled in the “Moby Dick Way” and closely monitored. Yet, people always came back because they always knew they would never be disappointed.

The little restaurant was a financial success story because Ralph and Monica employed basic success strategies. First, they understood what made their product unique and special, maximizing revenue through repeat business and word-of-mouth advertising. The Oswalds did virtually no media advertising. Most important was their understanding of generating predictable results every time through the systemization of every element in the business. They didn’t rely on the variability of employee personalities or aptitude and hoped to get consistent results. Instead, the systems and employees were closely monitored to ensure that a quality experience was delivered every time. Also, they overcame the constraints of a small kitchen through process organization which allowed Moby Dick to scale out of the one location.

Ralph and Monica Oswald succeeded through a thorough understanding and careful management of the critical metrics that generated revenue and control costs. In short, they built a cash cow.

Moby Dick has changed hands a couple of times since Ralph and Monica sold the business. The current owners have expanded the restaurant and have maintained the food quality and some of the charm. Although I would recommend the restaurant, it certainly is not a bustling beehive of activity and order it once was.

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