C&B Notes

Long Live the Chicken Sandwich

Chick-fil-A founder Truett Cathy died on September 8th.  Although we personally love his chicken sandwiches, we respect more how he carefully cultivated a corporate culture that produced both a unique consumer experience and a fast food chain that is likely the most-profitable on a per store basis.  Coke’s CEO Muhtar Kent penned a fitting tribute to Mr. Cathy:

When Chick-fil-A founder Truett Cathy died on Monday at age 93, America lost a true giant of a business leader.  I was honored to call him a longtime business partner, a dear friend and a teacher.  Truett lived the classic Horatio Alger tale, rising from humble roots to create a sensationally successful business.  His business experience began at age 8 in Atlanta, when he started buying six-packs of Coca-Cola for a quarter and selling each bottle for a nickel.  After serving in World War II, Truett opened his first restaurant — a diner in Hapeville, near Atlanta — in 1946, with his brother Ben.  In 1961 Truett invented the boneless chicken-breast sandwich that would eventually become a nationwide phenomenon.  Chick-fil-A is now America’s largest fast-food chicken restaurant, with $5.5 billion in annual sales — and a remarkable 47 years of consecutive annual sales increases.

How did Truett do it?  As someone lucky enough to know him, I saw six characteristics that defined the way he approached business, people and the communities he served…

…Fourth, Truett never stopped innovating, beginning with the creation of the Chick-fil-A sandwich itself.  If you’ve never had one, you might ask what’s so special about a seasoned boneless chicken breast on a buttered bun, garnished with nothing but a pair of pickle chips.  It’s still one of a kind, but 53 years ago it was a revelation.  Truett’s very business model was an innovation.  Unlike traditional franchises at the time, Chick-fil-A restaurant operators became partners in the business, and that ownership culture became a strong competitive advantage.  Many of the company’s corporate employees began their careers working in a Chick-fil-A restaurant.  Another innovation was Truett’s decision in 1967 to locate the first Chick-fil-A stores inside shopping malls, long before food courts were common.  This allowed him to start with a specialized product in a unique location with little competition and lower real-estate costs.  The first stand-alone store, in Atlanta, didn’t open until 1986.

…Sixth, Truett stayed humble.  He and his wife, Jeannette, lived in the same modest house near Atlanta for decades, and he never took himself too seriously. When asked what was so smart about creating his chicken sandwich, he would reply, invariably, “Nothing. That’s why I was able to do it.”