2005-08-01 - Western Restaurant News – Cover Story

Team Effort

Cactus Club Cafe has used innovation in their approach to both customer and employee relations to create a winning combination in the casual fine dining sector.

Vancouver-based Cactus Club Cafe has grown into the huge success it has become by simply saying yes – yes to customer, yes to employees and yes to its investors. In fact for the past 17 years their ability to state the affirmative has allowed them to consistently exceed expectations and deliver on promises with the result that they have become one of the fastest growing foodservice chains in the country. Now their characteristic service as well as innovative menu and décor package is earning them double digit growth and increased year on year sales with 16 stores open and more on the way in B.C. and Alberta. The business got its start when president and founder Richard Jaffray made the move to Vancouver from Calgary to become a waiter at Earls. This was back in the early ’80s when the concept of casual fine dining was just starting to roll. Jaffray reports that he learned much from Earls and was able to take this on-the-job education to a practical level when he and a fellow waiter opened Cafe Cucamongas, a funky latte bar and snack house on West Broadway.
“By the second year we were booming with sales of $500,000 in a 900-square foot restaurant,” says Jaffray, commenting on their early success. Jaffray and his team aimed higher and came up with a new concept for a casual dining operation and Cactus Club Cafe was born.
“I remember we had papier mache cows hanging from the ceiling. The concept was fun and crazy and very casual,” he says, stating that the first Cactus Club in North Vancouver cost $380,000 to open. Today’s evolution of the concept runs to more than $3.5 million for a front door key and features more granite and leather rather than papier mache. In fact, the appearance of the latest designs is a lot like a blend of Le Corbusier, Derek Flint and Hugo Boss. Locations are packed with stonework, custom leather bar stools, seating hassocks and wild lighting.
“We spend very heavily up front on site development,” says Carl Dean, Cactus Club’s CFO. “Our idea is to build without expecting to refurbish in five years. When we move on a site it is for the long term.”
Now with 15 locations open and Kelowna expected to come on stream this fall, Cactus Club is indeed in the market for the long haul. According to Dean the group is looking closely at areas on the West Coast for further development. “We won’t rule out taking the concept into Ontario either,” he says, suggesting that people should not expect the conventional from Cactus Club. “Part of what has made us a success is our ability to look outside our region and industry for inspiration.”
Dean himself comes from a background in the entertainment industry in his native Australia where he worked as a Chartered Accountant before joining Cactus Club three years ago.
“This concept is like the television industry. Dining at Cactus Club is entertainment and we are exacting a price from our guests for the privilege of serving them this package.”
High Specs on a Globally Inspired Menu
While the décor with its original art, natural woodwork and granite countertops is emblematic and has followed a steady evolution, so too has the menu. Where once Cactus Club was concerned with competition from family dining operators like Denny’s, now they are able to attract guests who might also look to Joey Tomato’s, Earls or Milestones for an urban lunch or dinner date. Indeed, the chain recently took on Executive Chef Julian Bond to head up the menu and drive the food experience to fresh heights.
Bond was previously director of Dubrulle’s Academic Program at their Vancouver school. Now he is researching menu items and overseeing the back of the house at all 16 Cactus Club locations.
“The menu here is eclectic, global and designed to create ‘wow’ with stunning visual elements and top ingredients. We are uncompromising in our approach to all aspects. This extends from how we work with our suppliers to how we develop new dishes,” he says, pointing to a recent example with a new chocolate cake that is in the works.
“We are in the process of changing the chocolate dessert on the menu that is a huge seller and has been a hit for more than three years. This is because of our commitment to both regular customers who want to find this item when they come in, as well as to those who want a menu that is fresh,” he says.
Towards this end Bond and his team that include Development Chef Dan Close have been working for two weeks at the test kitchen on the lower level of the Ash Street location in Vancouver to perfect the new item. “We ask - How can we make this incredible? What are the costs? Can this dish be replicated in each restaurant? There are a lot of factors to consider.”
When they are satisfied with their creation it goes upstairs to the restaurant and onto the Feature Sheets for six weeks and then off to a couple of other Cactus Club locations for further feedback before making it on to the menu.
We are equally demanding on things like steaks. We use certified Angus beef and look for a certain marbling profile and have very demanding specs. We won’t compromise and I have to admit that we are probably not the easiest operator for suppliers to do business with.”
Bond suggests here that by keeping their eye on the ball by working closely with suppliers they have been able to obtain foods with incredible specs at costs that would make competitors drool with envy. “Guests can dine on a steak here that is of the same calibre as they would expect to find at a specialty steak house but for much less money. We have worked very hard to provide a combination of tremendous value with intriguing elements that create excitement at the table.”
For example, one popular item that serves to characterize the creativity of the menu is the Cactus Club’s West Coast Pockets. This appetizer features tofu pockets filled with sushi rice, wasabi and avocado and wrapped in smoked salmon. “Customers can buy these by the piece for a light meal or a snack,” he says, commenting that the menu is a veritable smorgasbord of the world where guests can choose between dim sum, fajitas, pasta, Maui Chicken, Kung Pao Noodles, Thai Wings or Szechwan Beans as well as classic and contemporary beef, poultry and seafood entrees like West Coast salmon and fresh catch specials.

Teamwork and Continuous Improvement Key to Growth
The differences of Cactus Club Cafe extend still further. On the management level the organization shares much with the ideas of New York University’s Edwards Deming and his 14 points of Total Quality Management (TQM). At Cactus Club, foundations include welldefined vision, long term rather than short term goals, systems and processes where responsibility is shared as well as constant learning, the elimination of organizational barriers and profit sharing. Managers are known by the appellate ‘team leaders’, chefs are termed ‘kitchen leaders’ and the idea is for all parties to learn as a team and create an environment where improvement is a constant.
“What really works for us is that our people are given the tools to succeed,” says Director of Human Resources Anna Grolle. “For example, before a server is given a section they already have two weeks training in addition to their prior experience in the industry. We want them to hit the floor with confidence and the result is a great service presentation at table side and strong working relationship with other staff members who offer mentorship and contribute to on-going training.”
Grolle reports that Cactus Club tends to look within the organization for its team leaders with each store requiring 12 upper level staffers. These leaders typically take up to four years on the job before they have enough experience to take on the challenge, she says.
“Our challenge now, given our rapid growth, is to find the people we need,” she says adding that they have developed one of the industry’s most forward thinking approaches to training and retention.
“We want people to look at a position with Cactus Club as a career rather than just a job. We go the extra distance to make this happen. For instance, we offer an educational allowance to our people that helps pay school tuitions. We send staff to Dubrulle for wine training and even contribute to gym memberships to promote healthy living. We offer not just a place for people to work but we try to create a balanced environment that delivers a positive lifestyle that keeps our staff in place and helps make them more productive as well.
Andrew Latchford is a perfect example of the benefits of the Cactus Club culture. He began as a waiter while he attended university. He took advantage of the educational allowances as he worked his way up through the leadership positions to his current position as the company’s director of operations thanks to a business degree. Now he is benefiting further thanks to profit sharing where his shadow equity performance has earned him a stake in the new franchise in Kelowna. “This all contributes to a real entrepreneurial spirit at all levels of the business,” says Grolle.
Latchford agrees. Further, he suggests that with each store having a unique identity, there is not the pall of the big chain persona hanging over each outlet. “This gives people the opportunity to develop unique attributes under the umbrella of head office. In many ways, each store is a separate business with head office offering supports like menu development and marketing.
“While we have a certain individualism we also have systems that help us drive consistency and deliver on our quality promise in all locations. These can be as simple as putting expiry dates on coffee or making certain that ketchup bottles go out to the restaurant full.
“On another level we have involved audit procedures that have reduced our inventory leakage.” This allows Cactus to pass along the savings to the customer. He reports that stores produce a financial statement each week and each unit is scored on things like bar receipt accuracy, point of sale and cash. “The score is published and each unit is ranked. This creates a healthy competition among stores who challenge to become better each audit period and reach the top place in the chain.
Dean reports that the audit process is detailed down to the individual. If there are problems leaders can call in the employee to discuss ways they can improve performance.
“We have come a long way from beer and chicken wings. We are expecting our growth to double over the next five years,” says Latchford commenting that stores have shown a minimum five per cent gain each year with the company as a whole exhibiting an average of 25 per cent growth per year since inception.
President Richard Jaffray sums it up by stating that Cactus Club Cafe is all about growth. “Certainly we are doing very well on the financial side with stores exhibiting excellent gains. We could not have done this if we had not grown on a personal level. One of our original goals was to create a restaurant where people could find a career rather than just a job. I believe we have created such as restaurant and the result is that now through teamwork we have been able to continually improve the package to make it the success it has become.