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- Historic issues in things like unemployment/employment, supply chain, education, and of course, hospitality and restaurants over the last year and a half or so, and we've got plenty to talk about.

I am Chris William, and welcome again to the most widely watched and longest-running program on Carolina business policy and public affairs, seen each and every week across North and South Carolina for more than 30 years.

In a moment, we kick off this week's discussion.

And later on, he is the CEO of Golden Corral.

So what has that been like in restaurants?

We will start in just a moment.

We hope you stay with us.

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(upbeat rock music) On this edition of "Carolina Business Review," Tony Mecia from The Charlotte Ledger, John Lummus of Upstate SC Alliance, and special guest Lance Trenary, CEO of Golden Corral.

- John, Tony, welcome to the show.

John, I'm gonna start with you.

You know, you can't turn on a business news channel or read a headline, or it doesn't have to be business news, about this issue of supply chain issues, shortages into the months and maybe even years.

So in what you're seeing, John, what does that look like on the ground?

How long does a supply chain issue, crisis, last?

Is it a crisis?

- Well, I mean, right now, say, if you turn on the TV, if you're listening to the news, really, it's a worldwide crisis that has affected us over the last year, and it seems that it's moving forward.

From the state of South Carolina, the Upstate, it is certainly affecting some of our businesses.

But a couple of things that we're lucky about.

I know you said you had Jim Newsome on with the SC Port the other week, and our port has really not experienced those wait times like what you see on the West Coast and other places.

We still have some concerns there with getting it in and out, but we've fared a lot better with that.

And we have what we call the Inland Port in Greer, which is here in the Upstate of South Carolina, and that has helped us to some extent with being able to get goods and services to the port by rail and some of the efficiencies there.

So I think we're in fairly decent shape there in regard to the supply chain.

However, it is still a big concern with not only our manufacturers, but a lot of the other folks.

But I think what we've seen since the pandemic started have been fractured supply chains from overseas, particularly food shortages and to some extent supplies of steel, lumber, different things.

And one of the things that we have really been able to take advantage of, though, and we're seeing a lot more prospect activity with companies that want to be in an Eastern U.S. location that they can get their goods and services out, particularly food and beverage.

We're seeing a real uptick in food and beverage projects, because one day's driving distance of the Upstate of South Carolina, there are 110 million consumers.

So companies that may have been operating on the West Coast, may have been operating in Europe, are really starting to look here for their distribution network.

So I guess that would be the silver lining of a dark cloud, that things are better in our area than some other areas of the country.

- You know, Tony, as you listen to John, obviously John describes Upstate South Carolina, heavy manufacturing rich environment in the Charlotte region.

In the Piedmont, different story.

A lot of manufacturing, of course.

But how do you see it from your perch, this issue about supply chain?

- Yeah, I mean, obviously a lot of different causes going into that.

You have the supply side of things, overseas factories, shipping costs, but you know, there's also the demand side of things, and people that we talked to just with The Charlotte Ledger, they're telling us they're just seeing it.

It's hard to predict this demand coming out of the pandemic.

So it's a couple of different things.

You talk to people who build houses or who work in construction, developers, they've always, to some extent had some troubles getting materials, but now it's just really exacerbated.

I think you're gonna see delays.

There have always been delays in construction, right?

But I think that you're gonna see those exacerbated, certainly in the Charlotte market, while that really hasn't slowed down.

We've got shortages of all kinds of things, consumer goods.

The ABC stores here, a lot of them, the shelves are bare of liquor.

A lot of causes behind that.

But it's really playing out in a bunch of different ways.

I mean, a lot of it is, I think, driven by this just-in-time inventory apparatus, the way they use to manage inventories.

Now you're seeing how fragile that is.

So it's pretty widespread.

It's playing out all over the place.

- John, back to you.

So we take supply chain, we take, as Tony talked about, just-in-time inventories, but you can't, all of these issues are not indivisible from labor, from the workforce, single largest cost in most businesses.

So when you hear about, on top of that, the issues about labor and that the gap is even wider between those who are looking to hire and those who are out looking for a job, is that a crisis?

Same question.

- I wouldn't say it's a crisis, but it's a concern, and definitely an issue, again, all over the country.

One of the things that I work on is connecting with what we call site consultants, which are individuals or companies that work with companies on relocations.

And that is always the number one issue that we hear from them, is labor and workers.

"How am I gonna get my people?

How is this company gonna get our people?"

We had 11 site consultants in our region last week, and that is the number one concern.

And in South Carolina, as across the country, labor is tight.

It's gotten tighter since the pandemic, because a lot of skilled workers have stayed on the sidelines, but the only thing we can do is try to keep that pipeline going to get workers into, really, manufacturing jobs, 'cause we have 2,000 manufacturers in the Upstate region, 115,000 people working in manufacturing, so that really drives the economy.

And I think one of the things that you may have seen, this week, our governor has proposed using some of the COVID relief funds for certificate training programs in high-demand positions.

Truck driving is the number one high-demand position that we have, which is key to our supply chain and our logistics, but a number of manufacturing-related things.

So we're trying to make some headway on that, but the key is getting people trained and getting them into these jobs.

And that's, I worked in the Technical College System for eight years before this job.

That's always the key, is marketing, getting people to go into the programs.

- You know, just a quick follow-up.

You talked about the South Carolina Technical College System, and in North Carolina, obviously, the Community College System.

Are they unfairly taxed, John, with the idea that they have got to be the solution to figure out the skilled labor issue, or is there, and again, very quickly, is there another way to include, like maybe going to school boards and having school boards and public schools understand that some of these kids coming out of K through 12 can maybe find a job as an apprentice?

- And you know, it really even starts before that.

I mean, the career centers are the key to getting the kids that are in middle school and high school to start thinking about what their career path is gonna be.

We have a Youth Apprenticeship program in South Carolina.

I'm sure they have that in North Carolina.

And really, the key to that is not only the schools having the programs, but then the businesses, the manufacturing community, supporting those programs and hiring these students to start getting trained in high school so they can move into those jobs soon after high school.

Several companies in our region have really been focused on that, BMW, Michelin, Bosch, and others on trying to get those kids as early as possible to get 'em in that track.

And I think it's incumbent on companies, as well as the educational system, to help drive the students into those courses.

- Yeah, well, let's hope they get some success in that.

Tony, you get the last question, about a minute left.

In Charlotte, within the last two weeks, a fairly meaningful development around the issue of DEI, or diversity, equity, and inclusion, and that is Charlotte, with all of its corporate citizens, have committed about $250 million, and that number may be higher, and I know you know about this, but Charlotte Mayor Vi Lyles has a racial equity initiative that looks to invest that $250 million in DEI broadly.

How optimistic are you that this total amount will be raised, and do you feel like it will find the proper home?

- Yeah, I think, certainly, city leaders are very optimistic that they can get there.

They already have commitments for, I think, $196 million.

That's a combination of public money coming from federal COVID funds, as well as private philanthropy, much of which comes from Charlotte's big companies, the banks, healthcare systems, things like that.

And I mean, they're gonna use that money, they say, for a number of different initiatives, improving Johnson C. Smith, a historically Black college, helping to eliminate the digital divide, making sure kids have laptops and can get wired in, regardless of their socioeconomic status, improving some distressed corridors.

So there's really been, as you know, Chris, a big emphasis on diversity, equity, and inclusion over the last year and a half or so by corporate America.

They wanna be involved in that conversation.

They wanna make sure that as Charlotte grows, that it grows equitably.

So they're certainly earmarking it towards places where it will help.

I don't know if anybody says it's gonna solve these problems, but the hope is it would make 'em better.

- We were talking before the program, who hasn't been to Golden Corral at some point?

it is basically institutionalized comfort food.

We have now the president and CEO.

Lance, welcome to the program.

So who hasn't been been to Golden Corral?

I'm sure you hear the stories and people talk about Golden Corral, probably, pretty affectionately.

- Absolutely, yeah.

You know, I've had the honor of being with Golden Corral for 36 years.

As you know, we're a North Carolina-founded organization.

We were founded in Fayetteville.

And it's just fantastic to hear family stories, family from military, it's a celebration place for graduations, or even, we do a lot of rehearsal dinners.

You'd be surprised by how many weddings we cater.

It's just our tagline is "The Only One for Everyone," and so it's a great place for everyone to find something that they can enjoy at Golden Corral.

- Lance, in the early days of the pandemic, we were, I think, a lot of people surprised by the deep effect on hospitality, and certainly restaurants.

How did Golden Corral fare, and where are you now?

- Well, I appreciate you asking that.

You know, the restaurant industry as a whole was deeply affected.

Over 90,000 restaurants across the country have closed permanently.

And so the industry was dramatically affected by the pandemic, and the pandemic single-handedly handed the buffet industry a devastating blow.

Most in our segment did not make it.

But Golden Corral, we've fared well, we've survived, and we're now back in a position to thrive and grow again.

We started with about 482 restaurants pre-pandemic, We have 360 restaurants reopened now, and we have about another 48 that are in the pipeline that are currently hiring crews, remodeling their restaurants, and preparing to reopen sometime between now and the first quarter of 2022.

So we're excited about our recovery, but at the end of the day, we lost 70 to 80 restaurants during the pandemic.

That was just heartbreaking.

Some of them, even right here in North Carolina, were right at the end of their lease, and our franchisees chose not to renew with the uncertainty of the future and the way things were looking in the early days of COVID.

So you certainly understand that.

But the good news is we've got a lot of markets being redeveloped now, and we've actually begun selling new entities to join Golden Corral, not only in the United States, but we actually are working with a group in Mexico now, and we opened a restaurant in Puerto Rico.

So we've got a lot of fun irons in the fire, so to speak.

- Mm-hm.

John, question?

- Yes, sir.

Lance, very, very proud of Golden Corral, and what y'all have done, particularly in North Carolina and South Carolina.

I was telling Chris earlier that the first one I ever went to was in Winston-Salem, North Carolina, where I went to college.

- Yes.

- And we have one in Anderson, South Carolina, where I live now, and it's always packed.

But my question is, in regard to workforce, what are you seeing?

I know there's workforce shortages all across the board, and we deal with a lot of manufacturing here, but all across the board.

What are you seeing in your ability to attract workforce, to retain workforce?

And then, how has that impacted y'all's ability to operate during the pandemic- - Yes.

- And moving through that?

- Well, it's a great question, and very relevant, because it's the number one issue in the hospitality industry right now.

As a whole, the industry is down 1 million jobs across the country.

Right here in North Carolina, we have 50,000 open hospitality jobs.

So it's a significant issue across the board.

But at Golden Corral in particular, we have about 5,000 open positions across the country for our particular brand, and about 125 open management positions across the country.

So it definitely has impacted.

When I mentioned earlier that we had 40 restaurants that are in the hopper, so to speak, getting ready to open, they are really being held back by their ability to hire, retain, and get people trained into our restaurants.

So it is obviously been a significant challenge.

The good news is that we have an incredibly loyal workforce that were a part of Golden Corral.

We're a 48-year-old brand, and we've got many co-workers that have been with us 20, 25 years at a lot of our locations.

So all of those folks, as we began to reopen through the summer last year and through the fall, they were eager to come back and rejoin us.

But unfortunately, what happened during the early days of the pandemic, when we had to shut down as a result of COVID, all those folks had to find work, and so they began leaving the industry.

And so they're in other jobs now, whether it be manufacturing or retail, and they're in a position now that they're just not able to come back to the hospitality industry.

So we're having to get very creative as the way we think about bringing co-workers back into not only Golden Corral, but the restaurant industry as a whole.

Things like child care is incredibly important to us now, and the way that we think about how we help supplement that for co-workers.

Of course, wages and benefits, that's always been important to our folks.

But I think, really, now, us focusing on being the employer of choice, making sure that we have an environment that offers flexibility, that offers a lot of different career options, education support, all of those things are critically important to attracting the best of the workforce now and getting people to re-enter the hospitality segment.

It is a challenge, though, and there's a lot of barriers to people to rejoining the hospitality industry right now.

And so it's been a slow recovery in that regard.

- Lance, and Tony, I'm gonna give you a second here, but Lance, let me ask you this question.

Considering that we have viewers in North and South Carolina, is there a difference between the reopening and the re-engagement of the team members between North and South Carolina, or is it generally the same?

- No, really, our Carolina stores, both North and South, are behaving very similarly at both.

These two states are actually performing better than our system average, so we're pleased with where we're going.

But they're still facing a lot of the same challenges that we are in the Midwest, or even on the West Coast.

- Okay, Tony, question?

- Yeah, I'd just like to dig in a little bit more on sort of this.

It just seems so fascinating to me about how you lead through something like this.

I mean, you always have a demanding job as leader of this big company, but then the pandemic hits, and you're having to manage all kinds of things.

Employees, franchise relationships, deal with stores, new regulations that vary in all different jurisdictions that you're in.

I just wonder, for our viewers out there, what were some of the lessons from that?

How did you go about that?

How did you tackle that?

Did you bring in consultants?

Did you have emergency meetings?

I just wanna know what that looks like and what the lessons are for other people that are going to be forced to make change in their organizations.

- It's a good question, and I'll tell you, it's been one solid emergency meeting since March of last year.

(Chris laughs) So it's been constant.

But I credit our team.

We have an incredible senior leadership team, and the team here at Golden Corral.

And our franchisees have been incredibly resilient.

They've really been very resourceful and creative and trying to find ways through this.

And I think this collaborative spirit of really trying to achieve... At Golden Corral, we have something that James Maynard, our founder, started, and Easter Maynard, his daughter, has perpetuated.

We have a hundred-year plan at our company.

It existed prior to COVID.

And basically what that means is that all the decisions we make are consistent with us being in business for at least a hundred years.

And so it's a long-term view of our business.

And so, as we entered into COVID, we kept that very much in mind.

And I think a lot of the things that we've worked on through the past 47 years prior to COVID really came back to pay off.

The relationships we have with banks, the relationships we have with vendors.

We've always tried to make sure that we do the right thing, we're always very transparent with everyone that we operate with, and we try to be fair and honest in every single thing that we go about.

And so when COVID hit, we found that landlords, lenders, vendors, everyone was very willing to work with us and to help us try to find a path through this.

And I think that's been a lot of the success factors we've had.

But we had to introduce flexibility like we've never had before.

In the early days, because of COVID, it changed our business model.

It caused us to introduce protocol that we have never even really thought about.

We had to test new, innovative ideas, things like cafeteria-style or delivering the buffet to the table, introduced entrees into the restaurants.

We've tested alcohol.

There's just a list a mile long of things that we were willing to try to try to generate enough revenue to keep our franchisees moving forward, and really buying enough time so that we could start seeing recovery.

And to be honest with you, the recovery, for us, really didn't start as fast as it did in the rest of the industry.

Because being a buffet and the uncertainty around the touchpoints and things of that nature, people were a little reluctant, in the early days, to return to Golden Corral.

But because of our reputation and because of our community involvement and engagement, people slowly started returning, and once they came in, they were locked, they were very much back a fan of our company, because they saw all the safety and sanitation protocol that we'd put in place, they saw all the innovation that was going on inside the four walls.

And so as we began to emerge from the deepest or darkest part of the pandemic, then we really started accelerating the innovative ideas around revenue growth and trying to think of ways to really attract our most loyal and heavy and medium users.

Our most loyal guest eats with us, pre-COVID, 70 times a year.

I mean, they are loyal.

(chuckles) They represent about 17% of our total guest base, but they're 64% of our traffic.

So people that love Golden Corral absolutely love Golden Corral.

And we wanted to make sure that we were catering to them, that we were making sure that they had their favorites, their comfort foods that Chris mentioned earlier.

We wanted to make sure and have those available and to execute 'em at a level that they were so excited to be able to enjoy again.

So it's been an interesting 18 months.

We've learned a lot.

We've grown together.

Our franchise community and our company operations, we're in communication daily.

That was another key factor throughout this entire ordeal, was that the communication had to be constant.

I think in the absence of communication, people's minds start running wild, and they can create a lot of bad scenarios without the proper or correct information.

So we were constantly reinforcing what was really going on.

We were very transparent.

We told the good, the bad, and the ugly, and we wanted to make sure that everyone was able to see a path forward, but yet understand the reality of where we are, and- - I'm sorry, I don't want to interrupt you, but we're gonna run out of time.

We have less than two minutes.

- Oh, yes, yes.

- And John, please, last question.

- Yeah, sure.

One of the other issues we were talking about a little earlier was in regard to supply chain and the fractured supply chains that have occurred during COVID.

Have you seen difficulties in getting your food and your supplies to your stores since COVID?

- [Chris] We have about a minute, Lance.

- Sure, it's been a big problem.

The supply chain, we've gotta work with the government to try to loosen regulations around trucking and the port.

You know, we have product sitting in ports in Los Angeles right now that we can't get to our restaurants.

The supply chain is so backed up that there's not a week goes by that we don't have an issue.

And so that's why the restaurant industry has recovered in sales, but our margins are being squeezed dramatically with rising commodity costs, supply chain issues, wage and hour issues, or workforce.

And so that's why things like, right now, in the North Carolina budget, there's a $500 million provision to help hospitality or small business grants.

And we're really hopeful that that passes, because our franchisees, our independent business owners, absolutely need that funding to be able to progress and move forward and into the future.

- Lance, I hate to say we're out of time, because all the information you've been sharing and articulating has kept us rapt.

Thank you for your leadership at Golden Corral, and please come back, because we clearly haven't unpacked everything.

But best of luck going forward, and we'll think differently now standing in the buffet line.

But thank you, Lance.

- Well, thank you.

I appreciate everyone's time.

- Thank you.

John, good to see you again, Tony, thanks for being on the program.

Happy weekend.

Until next week, I'm Chris William.

Good night.

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