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Cactus Restaurants

Growing up sensibly

Growing a business is a tricky enterprise. Cactus owners Bret and Marc Chatalas weren't thinking strategically in the beginning, they were looking for careers. As it turns out, they've grown a very successful chain of Cactus restaurants.

The brothers grew up in the restaurant business. Their father has owned Lowell's at the Pike Place Market since 1980. "It was an investment for him, but vocation education for us," recalls Marc. "We were expected to work there on weekends and when not involved in sports. By the time we were 14 or 15, we were kind of baby-sitting the place, covering for the general manager on his weekend and vacations. I didn't appreciate it and kind of resented it. In hindsight, it was a very good thing for both of us."

As Bret left college, they were thinking about jobs. Cactus in Madison Park was about a year old offering Latin-inspired food and tapas, something new in Seattle. They bought the business in 1990 and Bret ran it for ten years. After Marc got out of college in 1994, they started Mad Pizza. Marc ran it while Bret ran Cactus. "We thought Mad Pizza would be a growth vehicle and opened three locations. After five years, we realized we didn't like the pizza business. Even with delivery, it had a small footprint, the margins were low and it wasn't interesting enough. We didn't feel it had significant potential, so we sold it in 2000."

Cactus Madison Park, by Geoffrey Smith

They found the Kirkland location for their second Cactus in 2001 and opened in 2002. "We wanted to be near the water, so it felt like Madison Park. I ran that location, but they were different restaurants. We had different wine and cocktail lists. The menus were 70% the same and 30% different by design. We didn't coordinate on points of service. We were going for the anti-chain, neighborhood feel."

There were no managers; Marc and Bret did everything. "It was a challenging time. It took me a year to get on stable footing. But we'd talk about our successes and transfer them to the other location. We started narrowing that 30% menu gap."

In August of 2007, they opened their Alki location. "That is when we became a company," says Marc. "We created a corporate headquarters at Alki. We looked at every corner of the business and had to come to a consensus on how to proceed. It was a lot of work and sometimes hard. We both have a strong sense of what we want to do and each had to make concessions. Eventually we completed a company operations manual and came up with best practices on training, growth, everything." Managers were put in place at each location. "We improved our existing two stores. We had green management teams in both places. We learned how to hire and train managers. It was a rocky period. It's difficult to give someone else the toolset. Our history was oral before, now we have a training program in writing. We used two books that really helped us: The E-Myth Revisited by Michael Gerber, and Setting the Table by Danny Meyer. These helped us create a real business and are the bedrock of who we are today."

Although they had positive growth from day one at Alki, they were unsure if they wanted a fourth location. "We were very cognizant that one bad location could set us back significantly or even sink the ship. After 2009, we started thinking seriously about growing again. We're always looking, just to keep on top of what's in the market. After 2004 when the Seattle Commons project fell apart, we got in touch with Vulcan about their South Lake Union development just so they'd be aware of us. We've always been patient. We passed on 7-8 spots and were negotiating on one when a corner spot came up. "It was obvious that was the place. We signed the lease in April, took possession in June, and opened November 14, 2011. We used a new architect and construction firm which was scary for us, as we were hesitant to change any variable of the formula, but it worked well. Opening was easier because we had our systems in place. The biggest challenge was the private dining space. It's a different business. We had to learn to market, book and operate it. It added complexity, but it's one of the best things we ever did. It's booked all the time and we fill it every day at lunch."

Cactus South Lake Union, by Geoffrey Smith

On December 10, 2012, they read that Z'Tejas was gone in Bellevue Square. They called and found out that someone was negotiating for the space. That fell through and they signed the lease on December 27 and opened on June 4, 2013. "We were nowhere near water, but had realized with South Lake Union that we didn't have to be in a neighborhood or by the water; our perception of who we are had been changed. So the mall location made sense."

With five locations and over 300 employees, the company has matured. "We feel like we're operating better than ever, and we're creating new food all the time. Since 1990, we've created over 3000 unique menu items. We've been around for 23 years and need to keep it fresh. There's a fine line between being innovative and knowing that people like consistency. Our specials are a way of deciding what dishes might become 'Cactus Classics.'"

Butternut squash enchiladas, by Geoffrey Smith

They're always looking to improve, and keep an eye out for new locations. "We don't have to open more, but will if it makes sense. There will definitely be another Cactus. We want to create opportunities for our team, and know our company is always in a ready position." They've started doing job fairs twice a year where they can vet people quickly, train them as a group, and deliver fully-trained employees to the stores.

Great food, beverage, service and a fine-tuned engine behind it all means Cactus should be around for many more years.

Madison Park
4220 E Madison
Seattle, WA 98112

South Lake Union
350 Terry Ave N
Seattle, WA 98109

121 Park Lane
Kirkland, WA 98033

Bellevue Square
535 Bellevue Way NE
Bellevue, WA 98004

Alki Beach
2820 Alki Ave SW
Seattle, WA 98116

Connie Adams/May 2014

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