Food & Beverage Management Company President / Entrepreneur – Mentor – Siegmund “Sig” Brown

Food & Beverage  Management Company President / Entrepreneur

Mentor,  Siegmund “Sig” Brown

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Sigmund is the founder and sole shareholder of EXPOSERVE Management Corporation, a food and beverage management services company that has contracts with major entertainment venues in Oklahoma that host sporting events, concerts, trade shows, exhibitions and the arts. These include the Tulsa Expo Square, a 240-acre multipurpose complex with a variety of events throughout the year. Other venues are The Tulsa Performing Arts Center, The Oklahoma Aquarium, The Philbrook Museum of Art, The SpiritBank Event Center, Harwelden Mansion and The Hardesty Arts Center.  Since launching his business ten years ago, he has experienced compounded annual growth, doubling his share of the local market.  

Sigmund grew up in Western Canada. His parents were hotel and restaurant managers who were trained in Europe. Initially he was not interested in following in his parent’s footsteps in the hotel industry. Instead he worked two years as a waiter before the restaurant’s owner recognized his potential and encouraged him to go to college and get a hospitality management degree. With limited access to good hotel schools in Canada, he chose Florida International University in Miami. While he was there, he joined student associations and built a network of contacts. When Siegmund graduated, one of his professors, Dr. Mickey Warner, helped him get his first job with Fine Host Corporation, a national food and beverage services company. He quickly advanced and became a general manager after two years and was transferred around the country before he was assigned to Tulsa. The parent company ran into financial difficulties shortly after he was transferred to Oklahoma and began a financial reorganization. Seeing the parent company’s financial problems made him realize the importance of understanding finance and accounting and he began pursuing an MBA at the University of Tulsa even before he launched his company. After completing his advanced degree, he had the confidence; contacts and access to financing that enabled him to minimize the risks of starting a business. In this article, Siegmund talks about how he manages his business as well as the things you need to know when choosing a college if you decide you want to pursue working as a manager in the hospitality industry. It is an interesting article by a successful entrepreneur that will be especially valuable for those of you interested in owning or managing this kind of service business.

 

Overview

 My parents were trained in hotel management in Europe and met in Nairn, Scotland when they both immigrated there to work for a golf club. Later they relocated to Canada where my father started a career with Canadian National Hotels.  We moved a lot while I was growing up living in Montreal, Ottawa, Winnipeg, and Edmonton before moving to Vancouver when I was 16. While I was in high school, I was active in athletics and was a downhill ski racer specializing in Giant Slalom. I also began to work part time in restaurants to earn spending money. My parents provided me the basics. But if I wanted something extra, I had to earn the money myself. We never had cable television and there were no computer games you could play endlessly at home.  The closest thing we had at the time to these kinds of games were arcade games that I had to pay for myself, which limited the amount of time I could spend on them.  I read a lot of books, especially those with topics that related to business, autobiographies of entrepreneurs and self-improvement.

My first job in high school was as a dishwasher. Then I figured out that if I bussed tables I could also earn tips. I later became a waiter, which allowed me to make what I thought was a good living after I graduated from high school. I had a nice apartment by the beach and a car and was pretty happy with my life. The restaurant owner, Bud Kanke, thought I had the potential for something better and encouraged me to go to college and get a degree in hotel management. There were limited options for good hotel/hospitality management schools in Canada, so I applied to Cornell and Florida International University, the first and second highest rated schools in the US. My high school grades and test scores were not good enough to get me into Cornell and I ended up going to FIU with the idea of getting my grades up and later transferring to Cornell. I did make much better grades in college than in high school because I was interested in all the subjects.  When I talked to my advisor at FIU about making the transfer to Cornell, he pointed out the additional expense of attending that ivy league school and offered a waiver of the higher out of state tuition to keep me at FIU. So after weighing my options, I decided to stay. While I did end up with some student loans, the Canadian government put a cap on how much your student loans can be after graduation and paid about 2/3rds of my student loan debt.

Besides academic programs, all good hotel management schools like FIU also have practical programs in things like food and beverage management along with classes that teach you how to manage a restaurant, catering company, hotel or resort where you also work in those kinds of jobs after your regular classes. I volunteered at the South Florida Students Branch of the International Food Services Executive Association.  I attended classes from 9:25 until 2:00 and then spent my afternoons doing Association business that included catering events around campus and beverage service at a local sports stadium. We also had a competition where students developed and ran a new restaurant concept. But the primary emphasis at FIU and all hotel management schools is management. For example, while we leaned about things like food preparation so we could manage a restaurant or food services business, the training of cooks and chefs is done at specialized schools that teach the culinary arts not at a hotel management school.

While I was in college I worked at building relationships and was noticed by one of the faculty. When I graduated, he helped me get a job with Fine Host Corporation, a food and beverage services company that was rapidly expanding by opening new braches and acquiring other companies. I became a general manager in just two years.  But I traveled all around the country, which kept me constantly on the road. When I was transferred to Tulsa, the parent company got into financial difficulty and ended up declaring Chapter 11 bankruptcy, which was meant to allow it to reorganize. I recognized the company’s accounting and finance practices had gotten them into trouble and decide to get a MBA at the University of Tulsa to learn more about finance and accounting.

I was a father with young children at the time and wanted a job with less travel so that I could have a more stable family life. I left my employer shortly after their reorganization was completed and launched my company. Over the last ten years, I was able to build my book of business with a laser focus on just the local market. We have added The Tulsa Performing Arts Center, The Oklahoma Aquarium, Fairmeadows (A horse racing park), The Arts and Humanities Center, Harwelden (a restored mansion that is a reception venue), The Hardesty Arts Center and The Philbrook Museum. We currently serve over two million meals per year.

 

Managing the Business

In order to manage this kind of food and beverage business, you must do your math. Every recipe is a formula where you have to first project how many people you are going to serve and then how much of each ingredient you need to order. Likewise, you have to know how many people something like a container of soda syrup will serve in part by measuring how much ice you are going to put in the cup and then determining how many cups to order. During an event like the fair that lasts for 11 days, we order food and beverages for three days. If we sell more than we projected through the second day, we take from the third day’s inventory and reorder with our suppliers at the end of the second day to adjust our inventory for the variation from our projections. So preparing for an event is a process that uses mathematical projections and mathematical formulas.

Besides large events, we manage the restaurant at the Philbrook Museum where we design a menu and order food just like any fine dining restaurant. Because the food and beverage business is seasonal, you also have to be able to adjust the size of your workforce. We have a basic staff of full time employees that includes chefs, key managers and trainers. But we have regular part time employees who have been trained and who we can call in at different times of the year. We also hire part time employees who we train for specific events and work with non-profits. For example, if a high school band is trying to raise money, we will provide them with a food booth that they can staff in place of hiring part time employees.

Because every food service contract is competitively bid, you need to know your gross margins and must be able to accurately project the costs of things like labor, food, beverages, cups and other paper and plastic products as well as the cost of your service equipment Consequently, you are constantly doing accounting studies and preparing budgets to be able to calculate the margins for everything you are selling.

Keep in mind that this is a at least a sixty hour a week business that often requires you to work in the evenings and on weekends. A lot of people wash out of this industry because they do not like to work that many hours.

 

How of Prepare for a Career in Hotel Management

  • Take all the math you can in high school. As I have talked about in this article, running this kind of business requires you work with mathematical formulas for everything from recipes to determining how many people can be served with a particular amount of food or beverage syrup to preparing budgets that you use when you are bidding for work.
  • If you have good grades in high school and good test scores you will be able to get into the better hotel management schools. These are normally located near large cities with a tourist industry and include schools like FIU in Miami as well as UCLA in Los Angeles and the University of Nevada in Las Vegas.  Cornell is the highest rated hotel management school. But being in upper New York State, practical experience is from a hotel they have built near the campus.   But Cornell offers a quality network of contacts and a high rate of job placement. All these top schools are expensive, especially Cornell, which is an Ivy League school. There are several good regional schools like Oklahoma State University where the tuition is less.
  • I have found my MBA to be valuable and would recommend you get one if you want to manage your own business. Colleges that offer degrees in hotel management also offer Masters program that will give you a better business background than just an undergraduate degree. But many of these schools like Cornell will not admit you into their advanced degree programs until after you have at least three years or more work experience.
  • Take advantage of all of your opportunities to build a network of contacts while you are at college. There are many organizations you can join like the International Food Services Executive Association that I joined. Some of these are the American Hotel and Lodging Association, Casino Management Club, Club Managers Association of America, Hotel Sales and Marketing Club and the Professional Convention Manager's Association. If you have a 3.25 GPA and have complete half your course work you may also be eligible to join Eta Sigma Delta (International Hospitality Management Honor Society).
  • After you graduate, continue to build networks of business contacts. I am a member of the World Presidents Organization, The University of Tulsa Alumni Association and serve as a board member of the Tulsa Summit Club.
  • Try and maintain a balance in your life beginning in high school. I was involved in athletics and other groups in high school and college. I also manage my business in a way that leaves time for my wife and children.
  • Don’t spend a lot of time on video games and television. Pick up a good book and read it and continue this habit of self- improvement throughout your life.

 

Summary 

 I enjoy the challenges of managing my own business especially building a team of motivated employees who I like to see grow as individuals and who I reward by promoting from within. Owning this kind of hospitality business requires more management skills than you will learn in an undergraduate program. You should consider getting an MBA if you think you want to own your own business rather working as an employee. Go to the best school you can afford. The level of training and the contacts you will make at the better schools are important. Food and beverage service is a positive cash flow business that I was able to purchase with my savings and grow by not getting ahead of my cash flow.  The hospitality industry offers a good opportunity for entrepreneurs with a strong work ethic, management training and work experience.

Here is a link to our websites that will tell you more about my company and its divisions:

http://www.exposerve.com   

http://www.partyserve.com

 http://www.lavillaphilbrook.com

http://www.Bluerosecafetulsa.com

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