In 2000 at age 52, Jack Butorac was living the dream.
Having turned several restaurant industry successes into a hefty nest egg, Mr. Butorac set off to explore the fairways and sandtraps of the finest golf courses around his home in Louisville. “I was focused on golf. It worked out well — for awhile,” he said.
But while retiring early to hang around the house was great for Mr. Butorac, it was less so for Mrs. Butorac.
“My wife (Barbara) told me, ‘I love you for breakfast and I love you for dinners. But I didn’t sign up for lunch,’” Mr. Butorac said.
In any case, relaxing “just isn’t in my DNA,” he said. So Mr. Butorac returned to what he does best: packaging restaurant concepts into smooth operations so they can multiply.
By chance, a consulting job in 2002 led him to a Marco’s Pizza restaurant. And it was an eye-opener.
In Marco’s, Mr. Butorac saw a small pizza chain with the potential to be a national pizza industry powerhouse. “As I’m going through these stores, I’m thinking, ‘Man, all we’ve got to do is build this operation and brand it,’” he said.
Two years later after consulting for Marco’s founder Pasquale “Pat” Giammarco, he convinced Mr. Giammarco to sell him a majority interest in Marco’s franchising rights with a promise that he could help the chain expand.
Since 2004, Mr. Butorac, now Marco’s owner/CEO, has made good on that promise.
The little Toledo pizza chain, ranked 26th in 2002, is now the seventh largest in the United States and has gone from a three-state regional chain to one now operating in 30 states, the Bahamas, Puerto Rico, and India.
“When I bought the brand, I wasn’t looking to be the biggest pizza chain. I wanted to be the fourth-largest pizza chain,” said Mr. Butorac, 69, who still lives in Louisville but also has homes in Sylvania and Naples, Fla.
“At the time I said that, Little Caesars was struggling. They had closed hundreds of stores, but now they’re the third-largest so I might have to settle for fifth. But I’ll be happy with being No. 5,” he said.
Marco’s had just 126 stores in 2002, but is over 800 now with a new location opening every three days. It had 17.1 percent growth in 2016, will add 100 new locations this year, and is on pace to hit 1,500 stores by 2020.
Ranked by consumers as America’s Favorite Pizza Chain, according to customer survey firm Market Force Information, Marco’s grabbed the No. 2 spot on Forbes Magazine’s list of Top 10 Franchises to Invest In.
Then, in July Mr. Butorac received the restaurant industry’s highest honor — a Golden Chain Award presented by industry publication Nation’s Restaurant News.
The award goes to restaurant executives who exhibit outstanding leadership, strong company performance, career achievements, and contributions to their industry and communities.
Mr. Butorac said he could barely stand or speak earlier this month when receiving his award at a convention in Dallas. “I’ve always seen great companies get that, but I never put myself in that category. To get a Golden Chain award was phenomenal,” he said.
Mr. Giammarco said when he first met Mr. Butorac he found him to be “a very nice guy” and a professional with lots of business experience in developing restaurant chains.
But, “I wasn’t planning on selling anything to him,” the founder added.
“I liked him, and I trusted him. He knew what I had was something special, and he thought I wasn’t possibly growing it as fast as I could and making it as big as it could be,” Mr. Giammarco said.
But Mr. Giammarco said that despite his restaurant industry knowledge, Mr. Butorac knew nothing about the pizza business.
“All he knew was he went around to a bunch of our stores and saw the quality and consistency,” Mr. Giammarco said.
But, the pizza maker said Mr. Butorac seemed confident that he could take Marco’s to a higher level, and that intrigued Mr. Giammarco.
“To be honest with you, I thought he could definitely grow it and make it a lot bigger. But as far as a national chain? I wasn’t sure he could do that, but I thought there was a possibility of that happening,” the founder said.
“I definitely wasn’t sure about it, and for the first three or four years, it grew kind of slowly,” he added.
Mr. Butorac, on the other hand, was certain Marco’s could be something special.
On the consulting job in 2002, he spent a cold December day visiting five Marco’s stores — in Dayton, north of Dayton, Findlay, Perrysburg, and Toledo. He ordered the same five products at each store.
“As I’m going through these stores and talking to my friend in the food service business, I said, ‘Man this guy (Pat) has got the operation part down.’ ... I met Pat that night,” Mr. Butorac said.
Restaurant operations are Mr. Butorac’s specialty, having spent a career gathering knowledge at various stops.
Born in Minnesota, he graduated from Minnesota State in Mankato, then became a fast food manager trainee at Zapata’s mexican fast food chain (later renamed Zantigo’s). He quickly rose to director of operations for Zapata’s before it was acquired by Heublein brands, which owned KFC.
Heublein moved Mr. Butorac to its Louisville headquarters, where he learned to package a concept and systemize a business so it could be franchised. But Heublein was acquired in 1982, and KFC/Zantigo’s was sold to Pepsico in 1986.
Pepsico, which owned Taco Bell, shut down Zantigo’s, so Mr. Butorac went to work for Chi Chi’s Mexican Restaurants to package their concept and franchise nationally. After seven years, he went to the board of Fuddruckers, bought some franchises, sold them, and returned to Louisville.
In 1994, Mr. Butorac helped purchase the Tumbleweed Tex Mex Grill chain and was its CEO until 1999 before leaving the firm and retiring.
And then he discovered Marco’s.
Mr. Butorac said the biggest hurdle to making Marco’s a national brand was differentiating it from other brands.
Fifty percent of the pizza market was dominated by three chains, Pizza Hut, Domino’s, and Little Caesars, but the other 50 percent was shared by dozens of chains that were indistinguishable.
“And that's where I saw opportunity. I knew we could do something no one else could do — sell authenticity,” Mr. Butorac said. “Pat grew up in Italy. Marco’s is based on his Italian heritage. The pizza is his family’s recipes.”
The CEO had three pizza prototypes made, a Tuscan-style pizza, a Rome-style pizza, and a Milan-style pizza. They chose Tuscan, a style Mr. Giammarco knew best since it is his birthplace, and under the advice of a marketing guru, Syl Sosnowski, began branding it as an authentic Italian-style pizza. One of Marco’s slogans is “A Little Italy in Every Bite.”
“The product is key, but it’s got to have a look, a high quality product,” Mr. Butorac said.
They hired Bryon Stephens from Yum! Brands to run franchise sales, and Steve Seyferth, who ran an ad agency for Domino’s, to do marketing. Mr. Stephens is now Marco’s president.
Mr. Butorac was hoping for explosive growth, but Marco’s took longer than he expected. The 2007 recession hurt his growth plans, and by 2012 the company still hadn’t hit a goal of 500 stores.
But part of that is the company is fairly choosy about selling its franchises. Franchisees must be the right fit.
And Marco's investors can expect to pay, on average, $350,000 for a Marco's Pizza franchise, with a franchise fee of $25,000. They must have a net worth of $150,000 and $100,000 in liquid assets.
Still, “The thing we’re struggling with now is real estate. We’re kind of changing our business model, Mr. Butorac said of the company’s desire to convert existing free standing buildings of 1,400 square feet to bigger restaurants of 2,400 square feet with dine-in seating.
However, the CEO said he is happy with the pace of Marco’s growth.
“We have a great team around us, and I’d like to say we’re just starting. Can we get to 2,400 stores domestically? I think so, and we’re just starting internationally,” he said.
Mr. Giammarco agrees.
“Not everybody knows about Marco’s yet. I feel once we get into an area, we’ll be the dominant pizza producers in that area,” he said. “The top five? We’ll get there. It may take a little time, but we’ll get there.”
Contact Jon Chavez at jchavez@theblade.com or 419-724-6128.
First Published October 27, 2017, 10:01 p.m.
