Roads To Success 7.2

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What Really Counts

As highly as Jerry values land, he places an even higher value on people.

 “We are Christians and strongly believe in the concepts of the Bible,” Jerry explained.  “And the Bible clearly points out what we are to do with people and for people.”

Where people are concerned family, of course, comes first.  On my first trip to Boise Jerry was driving us to see his home when he related a very unique and entertaining story that beautifully illustrated the strength of his values, and how much he cared for his family.  The story never made it into Jerry Caven’s television episode, but not because it wasn’t worth telling.

It began with Jerry describing how the house we were about to visit came to be.  In the late 1970s, with five children growing strong, the Caven house had managed to shrink around the family.  Business was thriving, and they had the cash, so Jerry and Muriel decided it would be practical to design and build a new, larger home.

Jerry recalled the process as starting with the basics, but then the inevitable began to happen.  Muriel would comment that it would be nice to have a family room at the top of the main staircase and then Jerry would see the advantage of having a home office off the main hallway.

Jerry was a little apologetic and even a little embarrassed as he described how large the house became.  “It was never intended to be such a big project but you get ideas, then more ideas, and I guess it just kind of got out of hand,” he reminisced.  “Anyway, we ended up with this fourteen-thousand-square-foot house.  We had it decorated and furnished, and then moved in.”

The Cavens had not been in the newly constructed house too long before Jerry began to observe something he didn’t feel particularly good about.  “I don’t think my kids had ever thought about how much we had before.  You know, I don’t think they gave any thought to my assets or how much money I earned,” Jerry explained.  “But then we’re all in this big house and after a while I didn’t like the way they were acting.  We were all developing an attitude that I didn’t like.  Even Muriel and I started to forget our priorities.”

After giving the issue a great deal of thought and prayer, Jerry took action.  “I didn’t tell anybody, not even my wife, and I went out and bought a normal-sized house,” Jerry recalled.  “Then I invited my wife to lunch.”

Muriel wryly recalled that upon receiving her husband’s lunch invitation she thought he was going to ask for a divorce.  There was absolutely no tangible reason for her to believe such a thing, but during this period of their lives Jerry was extremely busy and spending a large amount of his time at work; he rarely invited Muriel to lunch because his schedule didn’t allow it.

Jerry explained his observations and concerns to Muriel over lunch.  “I told her how I felt about the kids, their attitude and all,” he recounted.  “She knew what I was talking about and agreed.  So, we left the big house and moved into this other house I bought.  I hired a caretaker to stay in the big house and we were gone for twenty years.”

In August of 1999 Jerry and Muriel moved back into the house they had built twenty years before.  They never considered moving out of this beautiful home a sacrifice.  Their love for their children, concern that their children develop healthy values and maintaining their own healthy perspective was simply more important.

© 2012 Philip Kassel

Roads To Success 6.2

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At Home On The Range

Seeing the potential in real estate early in his business career, Jerry Caven bankrolled property purchases from his chain of Royal Fork Buffet restaurants.  And real estate investments have proven as successful as the restaurant business for him.

“As our business grew our involvement in real estate grew,” Jerry told the Secrets Of Success camera.  “And we went to purchasing a duplex to purchasing a five-hundred unit apartment house.  So the real estate part of our business grew as fast as we could take the cash out of the restaurants.”

Today, Jerry considers the bare land he began buying years ago to be one of his greatest assets.  “That land we purchased over the last twenty-five years is the basis for the real estate that we now develop,” he explained.

Jerry’s company begins with the bare land and subdivides it.  Then his construction firm builds houses on the lots that his real estate company sells.  But there is one kind of land that attracts Jerry Caven like no other.

“I’ve always been interested in farming and ranching,” Jerry revealed.  “We bought one ranch, one farm and then another one, and another one.  After a few years they started to add up to a whole lot of farms and ranches.”

One of the most enjoyable aspects of shooting Jerry Caven’s episode of the series was the opportunity to take part in an honest-to-goodness cattle drive on the Caven-owned Half Moon Ranch.  This particular ranch consists of approximately 100,000 acres and runs 1,200 head of mother cows.

The Half-Moon Ranch is just one of several ranches that Jerry owns.  About four-thousand acres of it are dedicated to farming.  Alfalfa, corn and grass are grown to feed both cattle and horses.

“We are mainly in the cow-calf business,” Jerry described the operation.  “That is where you view the cow as a manufacturing plant, and its product is a calf.  We calve every winter in January, February and March and then we send those calves and their mothers to the mountains over the summertime.”

By the time the calves are returned to the lowlands in the fall they weigh approximately 650 pounds.  The next step is to sell them to a feedlot.  Jerry described the next step.  “The feed lot feeds the calves grain and fatten them up to fourteen-hundred pounds, and then they go to the slaughterhouse and into the grocery store.

Moving the cattle from the ranch to the mountains in the spring, and then back to the ranch in the fall calls for a good, old-fashioned cattle drive.  The cowboy life has largely disappeared from the western United States, a casualty of modern technology.  Most ranches today use four-wheel drive vehicles and even helicopters to herd cattle, but not the cowboys on the Half-Moon Ranch.

“We’re still in the west and we still run our ranch like the old west,” Jerry assured.  “On our cattle drives we use horses and we don’t take branding chutes with us or chutes to catch them in or doctor them.  We still use a rope.”

Juan Guitterez, foreman of the Half Moon ranch, offered his feelings about this aspect of ranch life.  “The air is fresh, nice and cool.  It’s one of the things I really enjoy the most, coming up here and moving cattle.”

“Herding cattle is a team sport,” Jerry elaborated.  “You have to feel what the other people are doing, where they’re at, what they’re going to do.  “It’s working together.  It’s an extremely difficult job but it’s a job everybody wants to do.”

Muriel Caven provided another perspective on her husband’s love of ranching.  “Well, I think it’s peaceful out there, especially after all the business of being in the office, being with people and solving all the problems,” she offered.

Jerry will tell you that the profit from ranching really isn’t in the cattle.  “The profit in ranching is in the real estate.  You purchase the land, and then you farm and ranch it, and you hold onto it for several years.  Usually the land goes up in value,” Jerry said.  “In the past we have sold some ranches and each time we’ve sold them for a profit.”

Land and business are a large part of Jerry’s life, and he certainly is not embarrassed by the profits generated from his enterprises.  But believe it or not, there is something of far greater importance to Jerry Caven than profit.

© 2012 Philip Kassel

Roads To Success 5.2

Royal Fork In The Road

With the success of his McDonald’s franchises Jerry Caven set out to expand his restaurant business with the new Royal Fork Buffet concept.  His hard work had paid off with McDonald’s and he saw no reason it wouldn’t work for the new restaurant.  As it turned out, the Royal Fork Buffet concept was so successful that Jerry eventually had forty-eight restaurants operating in twelve states.

“Essentially, with Jerry, it was something that he would like,” Merlyn Knight explained, referring to the restaurant experience.  “When we go into a restaurant, what do we want in terms of cleanliness, service, quality and value?”

In 1978, after eleven successful years of operation, Jerry sold his Royal Fork Buffet restaurants.  By the early eighties, he was ready to get back into the restaurant business again.

“We started to build some more Royal Buffet restaurants and so we opened up eleven restaurants the second time around,” Jerry commented.

The second time around turned out to be just as successful as the first.  By 2002, after thirty-five years in business, Jerry began gradually selling the second chain of restaurants – this time to make way for a brand new restaurant concept.

The new restaurant chain, Mongo’s Grill, continues Jerry’s tried and true approach to the restaurant business.  It offers the same cleanliness, service, quality and value as the Royal Fork eateries.  Mongo’s goes a step further offering a healthy choice of ingredients in a create your own stir-fry theme.  The menu of fresh meats, poultry, seafood and vegetables is proving very popular.  Jerry currently has five Mongo’s, three in Canada, one in Minnesota and one in Idaho.

But for what reason did Jerry sell his original chain of restaurants? Jerry supplied the answer, “We have always taken our excess cash flow and put it into real estate ever since we started business.”

Jerry actually started acquiring small properties back in his McDonald’s days and over the years his real estate holdings had grown substantially.  Other businesses evolved out of the real estate holdings and Jerry ultimately concluded that the restaurant business as an expansion tool no longer fit into his business plan.  He decided to center the majority of his efforts on real estate.

“The restaurants were doing very well.  The restaurants had no debt so we saw that as a good way to raise funds for the real estate part of our business,” Jerry elaborated.

As Jerry acquired more and more property he developed a love for a particular variety of land.  It was a love that would grow into something of a lifestyle, a break from the daily grind of corporate office work, and it would be profitable as well.

© 2012 Philip Kassel

Roads To Success 4.2

15 Cent Burgers

In the mid-1960s McDonald’s restaurants were not the McDonald’s we know today.  Merlyn Knight is President of Jerry Caven’s Royal Fork Restaurant Corporation.  He explained what it was like in the beginning.  “It was the old McDonalds with no indoor seating.  Just the open front and fifteen-cent burgers in those days.”

Merlyn Knight may be President of the Royal Fork Restaurant Corporation today, but he started out at Jerry’s first McDonald’s restaurant.  “Jerry hired me himself and trained me the first night,” Merlyn recalled.  “I worked alongside him for the whole time I was there.”

“We just got in and just worked, and just went with it,” Jerry added.  “We were actually running scared, I guess, of the consequences of not being successful.”

“We worked very hard but we had a good time in doing it,” Merlyn Knight continued.  “That’s what allowed us to become very, very productive and a very, very successful McDonald’s unit.”

The success at first was small, but success nonetheless.  “At the end of the first month we did a P & L for the first time in my life; I had no business training,” Jerry related.  “And we had made $700.”

That small profit would prove to be only the beginning.  McDonald’s headquarters took note as Jerry’s monthly profits steadily grew.  He had been in business six months when they approached him again.  McDonald’s had another restaurant in Portland, Oregon that was not doing well.  They asked Jerry to purchase it and turn it around, just as he had turned around the failing Boise franchise.

“I told McDonald’s we still don’t have any money.  They said, okay we will give you that one,” Jerry told our camera.

Jerry accepted, and eventually, McDonald’s gave him two more restaurant franchises that were not performing well, both in Washington State.  “Within about fourteen to eighteen months after taking over the Boise McDonald’s we had a total of four McDonald’s in three different states,” Jerry offered.  “Finally, about a year after that we got an honest to goodness franchise that we did pay for in Reno, Nevada.”

Jerry wanted to further expand his McDonald’s business, but McDonald’s would not sell him any more franchises.  The corporate headquarters advised him to operate the units he had with a promise of more franchises later.  Rather than wait for McDonalds, Jerry and his staff began searching for a new restaurant concept that they could start themselves.

“People are looking for value,” Jerry pointed out.  “They want good food, good service, in a pleasant atmosphere, and all that for a good price.  We decided on a buffet concept, so in 1967 we opened up the first Royal Fork Buffet in Pocatello, Idaho.”

It sounds rather cut-and-dried the way Jerry described it, but Merlyn Knight explained why the new venture wasn’t just another day at the office.  “It’s very, very risky because you don’t know how people are going to respond.  And buffets at that time mostly had been called smorgasbords.  They were an all-you-can-eat, kind of throw the food out there, and it was not high quality.  So the idea of having a buffet was to have higher quality, a higher image and really appeal to the family.”

So, Jerry Caven’s new restaurant concept was off and running in Pocatello.  Now the only question remaining was would it be as successful as his McDonald’s franchises?

© 2012 Philip Kassel

Roads To Success 3.2

Hamburger University

Jerry Caven continued with his busy life, not giving much thought to the McDonald’s Corporation and its ailing Boise franchise.  However, it eventually became obvious that McDonald’s was thinking about him.  Bernie Baxter returned to Boise to meet with Jerry, explaining the advantages of running the franchise and urging him to purchase it.  Bernie saw something in Jerry, and he wanted to see him running the restaurant.  Jerry again explained that he had no extra money with which to purchase a franchise.

Bernie Baxter returned to Chicago but soon returned to meet a third time with Jerry.  This time he came with a life-changing offer.

“He said that he had talked to Ray Kroc who was then the president and largest stockholder of McDonald’s,” Jerry divulged.  “Mr. Kroc said that if you will resign your teaching job and come back to attend, and graduate from Hamburger University in Chicago, he will give you this restaurant.”

Ray Kroc was working as a multi-mixer milkshake machine salesman when he met the McDonald brothers in the late 1950s, selling them eight of his machines for use in their hamburger restaurants.  Buying the company from the brothers in 1961 he was in the process of building it into the most successful fast food business in the world.

“Of course I don’t think Ray Kroc had ever given a restaurant away up to that point, but they badly wanted to see an operator in that restaurant” Jerry commented.

Jerry discussed the offer with Muriel, and having been raised in a Christian home, he included prayer in his decision making process, as well.  “I had become a Christian at a very early age,” Jerry explained.  “All of our business decisions we pray about.”

Jerry’s deliberation and prayer led him to one conclusion; McDonald’s offer was simply too good to refuse.  He realized, too, that this new venture was not without great risk.  He would have to resign from his teaching position and it was the only job he had.  In an admirable leap of faith Jerry resigned from his teaching job.  His employer did not take it well.  “They warned me that once I failed in the hamburger business they wouldn’t hire me back,” Jerry said.

Ignoring the warning and mustering what little courage he could, Jerry left for McDonald’s corporate headquarters.  “The plane got over Chicago and I actually felt sick to my stomach,” Jerry told me during his interview.  “What have I done?”

But there was no turning back and Jerry spent the next three weeks learning the McDonald’s approach to the fast food business.  Some of what Jerry learned didn’t do much to quell his fears.  “At Hamburger University they explained to us that a unit could not break even unless it was doing about $60,000 in sales a month.  And the previous month, before I took over, this unit had done about $12,000,” Jerry explained.

Jerry realized that he’d have to work hard to turn his McDonald’s unit around.  Returning to Boise, he literally moved into his new business.  “It had a basement,” Jerry recalled.  “I actually brought my cot into the basement and I stayed there twenty-four hours a day.  I lived there for a while.”

Making his new business a home away from home was a sacrifice, but one that would eventually pay off in a way Jerry never foresaw.

© 2012 Philip Kassel