This man is Carl Karcher and if you live in the western United States, you probably know him as the founder of the very popular fast food chain Carl’s Jr.
Carl’s New York Stock Exchange listed company CKE Restaurants, Inc. owns the Carl’s Jr. and Hardee’s restaurant chains, has over 30,000 employees in 42 states and 13 countries and has nearly $3.2 billion in annual sales.
Yet it all started so simply. It was 1941 and 24-year-old Carl, an 8th grade dropout, supported his wife and baby by driving a bread delivery route. The nation was still in The Great Depression and World War ll was about to start.
To make it even tougher, Carl had no business experience but he borrowed $311 using his car as collateral and added $15 and he bought a hot dog cart. I asked him why he would take such risk.
“I made $22 a week on a bread route delivering bread to grocery stores, restaurants and hot dog carts,” he replied with a smile and a sparkle in his eyes. “I got into business because I wanted to make more money and I also wanted to be my own boss.”
As if the economy and a pending world war weren’t bad enough, the Los Angeles market at that time was dominated by Hugo’s, a chain of 157 hot dog carts. Carl bought his cart from them with every dime he had.
“Two weeks after I started, Mr. Hugo told one of my workers that the cart [still] belonged to him and that he’d be by the following Monday to take the cart over,” Carl said describing his difficult start in business.
“I called him that evening and said that I bought the cart from his brother-in-law and he said that his brother-in-law didn’t own the cart,” and therefore didn’t have the right to sell it.
“I said, ‘Mr. Hugo, I’m 24, married and have a child. My wife is upset with me for buying that cart and I owe $311 to the Bank of America that I gave to your brother-in-law.’ He said, ‘I don’t care.’
“I was beaten down but stayed on the phone with him for 45-minutes and finally he said, ‘Keep the damned cart!’” Mr. Hugo abruptly hung up the phone and an overwhelmed Carl could now stay in business. I asked him what he learned from that experience.
“The lesson is, never give up,” Carl replied raising his voice. “Never give up.”
Did he then become an overnight success? Not even close. The owner of the property under his cart doubled his rent, he got into a tax dispute with the state and he caught one of his employees stealing.
“Stealing?” I asked. “One night at 9 p.m., I drove in to check on my business and did a count of the money in the muffin pan,” Carl replied with a look of sadness in his eyes despite the passage of all this time. “I discovered that an employee was keeping some of the cash and I told him to tell me the truth.
“He told me he was stealing and I told him he could keep his job because he told the truth. He worked for me for a couple more years and was a good employee. The lesson is to pay attention to your business. The most important thing is to have good controls because if you don’t, they’ll steal you blind.”
Carl and his wife Margaret, with their baby along-side them, worked hard and it paid off. Within two years, they had three hot dog carts and in 1945, as the war was still being fought, they took a bold step and added a restaurant, “Carl’s Drive-in Barbeque.”
“I was the cook and Margaret worked the register,” Carl said. “The receipts for the first day were $93.85 and the payroll was $120. I was very much discouraged but we kept working and after about three months, it started making money.
“I worked 15-16 hours a day, six days a week, including checking on the hot dog carts and I mopped and cleaned up on my day off.”
When did Carl’s Jr. begin?
“In 1956, we opened our first two Carl’s Jr.’s,” he replied. But this was when McDonald’s began its massive nationwide expansion and it appeared the competition would overwhelm Carl. It did not. McDonald’s specialized in hamburgers, fries and shakes but Carl selected from his barbeque restaurant menu and offered hot dogs, tacos and pastrami as well as hamburgers and fries.
The result? The Carl’s Jr. Restaurant Chain grew rapidly and became a major success.
On January 16th, 2008 Carl will be 91 and as chairman emeritus and a member of the board of directors, he is still active in the company, and still goes to his Anaheim office.
As we end this piece there’s a quick but meaningful story I’d like to tell you. Carl and I had lunch in a busy Carl’s Jr. and like everyone else; he got in line not calling attention to himself.
When he finally got to the front of the line, he thanked the employees for their hard work and then he paid for our meals out of his own pocket. Even after all he’s accomplished, the success hasn’t gone to his head, as he showed his humility and expressed his gratitude.