When Merritt Brown, 35, the owner of the only entirely black-owned Burger King restaurant in Washington, D.C., won the prestigious "New Business of the Year" award given annually by the D.C. Chamber of Commerce, the prize was as much a testimony to his staying power as it was a tribute to his business acumen. "They gave it to me for surviving," the native Philadelphian says, only half joking.
Brown says that since his franchise opened on May 21, 1980, survival on the corner of Branch and Pennsylvania avenues SE has been tougher than he expected.
Neighbors, upset about other fast-food restaurants that had caused numerous problems for the area, picketed the site for his restaurant and condemned his business before it ever opened. After he won zoning approval and opened the restaurant, his manager quit without notice. And his restaurant has been robbed three times in the past six months, Brown said. Still, he will not be deterred.
"The only way to have financial security in America is to own something," said Brown, who resigned in 1979 from a $50,000-a-year job as a stockbroker in Philadelphia to become a Burger King franchisee. A graduate of the University of Pennsylvania's Wharton School of Business, Brown said he realized that his academic training had prepared him for work in a corporation, not to be an entrepreneur. He chose a franchise as his first business venture so that he could reap all of the benefits of the parent company's experience.
"Franchises are willing to give support and advice on equipment, landscaping, dining room decor and things like that, which is helpful for somebody like me with no prior experience in fast foods," explains Brown. "Burger King did the marketing studies and site selection and they sent two experienced managers to help when I opened. Franchising removes a lot of the risk." But, says Brown, Burger Kings "fail just like any other business."
Brown underwent a rigorous application procedure. He was interviewed and Burger King investigated his finances. It took about $250,000, in cash and loans, to finance his store.
When the company accepted him, he took a train to Washington and caught a cab at Union Station, saying, "Take me to Branch Avenue." He'd been told by the franchise representative that there were good opportunities here, since the city only had eight Burger Kings as opposed to more than 50 in Philadelphia. Taking a quick look at the site at 3250 Pennsylvania Ave. SE, he returned home with no inkling that in the stately homes behind his future store, a storm was brewing.
The residential area immediately surrounding Pennsylvania and Branch avenues, called Hillcrest, is a solidly middle-class neighborhood of large, detached brick homes that sell for upwards of $100,000. The residents had seen a lot of fast-food restaurants on Brown's lot, which is near the Penn Branch shopping center. To the neighbors, such places were synonomous with trash, traffic and loitering. They were in no mood for Whopper hamburgers.
Rayfield Alfred, a member of Advisory Neighborhood Commission 7B which represents a section of Southeast, recalls the community's concerns.
The community "didn't want another fast-food restaurant. There had been a Mighty Mo, which failed," Alfred said. "They'd had curbside service, which I understand caused a lot of problems with cars racing up and down Pennsylvania Avenue. . . . Following Mighty Mo, there was another fast-food restaurant. That folded and for a long time the building was boarded up and there was trash on the lot. Finally, there was Hot Dog City. They closed and the lot became very littered."
Alfred said the Penn Branch Community Association "raised sand" with the lot owner and he "finally sent someone to mow the grass and pick up trash." The building was torn down and community residents thought their troubles were over. Then they learned that Burger King and Church's Fried Chicken planned to share the lot. The Penn Branch Association started a community campaign to fight construction; in the midst of the furor, Church's bowed out. Neighbors picketed Brown's site.
When he discovered that he and his franchise weren't welcome, Brown was alarmed. He said he felt that once he allayed the residents' fears, they would have a different attitude. He went to one of the community meetings and sat unobstrusively while, all around him, people condemned him and his business. "When people realized who I was they started howling and screaming that I was a terrible person, a drug dealer and a scoundrel," Brown said. He left the meeting shaken.
The community association challenged Brown's building permit before the Board of Zoning Administration, and asked that his business be barred from the neighborhood. The BZA ruled that Brown could locate his business on the site.
When they realized they'd lost, Penn Branch Association members stopped picketing and changed tactics. They formed a committee to negotiate with Brown for changes to solve what they felt were some of the problems his restaurant posed.
Paul Fox, chairman of the committee, said the group was willing to help Brown get a variance so he could have a drive-through window if he would cooperate by building a fence on the property adjacent to O Street, muffle the noisy vent on his roof, take down a brightly lit sign and move the driveway so that the entrance and most of the traffic would be on Pennsylvania Avenue.
Says Alfred: "At one point he Brown agreed to most of the things."
Brown applied for a variance with the zoning board to build a drive-through window, maintaining that the construction of the window was crucial for his business. This time, the zoning board ruled against him and would not allow the drive-through window. Brown, who of course was disappointed with the outcome, described the zoning board sessions as "fairly traumatic."
Once the furor died down, a somewhat drained but nevertheless resolute Brown began settling into the day-to-day life of a fast-foods entrepreneur. Managing his staff effectively was one of his first challenges. The self-motivated Brown was used to moving under his own steam and figured that others would do the same. His 27 employes, all young, many with little or no job experience, needed more from a boss. He was startled when one of the managers he depended upon most quit without explanation. For two weeks there was turmoil until he found a replacement. Later, he learned that his former employe had been having on-the-job pressures Brown knew nothing about.
"One thing that Wharton doesn't teach you is people skills," he admits. "I had to learn that it's better to get people to do things because they want to. I have to be careful when I come in to speak to everyone or their feelings will be hurt. I literally have to pat people on the back. I've got to motivate." Despite his attempts, Brown's employe turnover is high and he has learned never to depend too heavily on anyone.
Brown finds satisfaction in providing employment to those who are motivated. Sharon Jones, 21, whom Brown recently promoted to day manager, has been with him for a year. She lives at home with her parents and 3-year-old son. "I might have had to go on relief if it wasn't for this job," she says, but "my parents get scared since I'm a manager, because different stores have been getting robbed."
Holdups are one of the fast-food facts of life. In a dispassionate voice, Brown recounts, "We were open a year before we had the first robbery. I saw an increase when the economy turned down. When people get desperate, they'll do anything. It bothers me, but it doesn't deter me. That's the price of doing business."
His day is long; the first crew arrives at 6 a.m. and Brown is in the store by eight or nine. "Different things on every day," says Brown. He pays a fee to Burger King, which takes care of national advertising, among other things, but he does his own local plugs. "The Anacostia track team wants to take a trip. I talked to the coach about my giving money in return for having his team hand out advertising flyers. Last year I bought jerseys that had Burger King printed on them for a football team; after the game they ate in my store."
Brown stays in the restaurant through lunch, when he does 20 to 25 percent of his business, often lending hands-on assistance, making fries and Whoppers.
After lunch, Brown returns home to do his paperwork. "The record keeping required by government agencies is phenomenal," he complains. "I've got to keep a job application for three years, even if the person isn't hired. The IRS can ask to see my records anytime."
He says there are a number of disincentives to opening a business in Washington. "I believe the workers' compensation here is the second-highest in the country. The 8 percent sales tax is a shock to a lot of people; price is important to fast-food buyers."
By early evening, he's back at the restaurant checking on the night shift. He often attends civic organization meetings when he leaves. Sunday is his only day of rest.
Despite the hectic schedule, Brown is a laidback businessman, willing to wait out the hard times and smooth out the rough spots. He says he had no illusions when he opened his restaurant. He knew that his salary would plunge initially and that the demands on his time and energy would skyrocket. "No business is easy unless you can turn lead into gold," he quips.
Brown says he did his homework and sought the advice of friends and relatives before signing the contract with Burger King. "Several tried to discourage me by telling me that the economic condition of the country wasn't right for a business venture," he said. Before opening, he committed his financial projections to paper and declares that the document is still realistic, despite the prospective $750,000 in gross sales that he and Burger King officials predicted for 1981, which totaled only $450,000. He expects to do about the same this year.
"Burger King did a study. When the economy declines, the first to feel it are expensive restaurants," Brown said. "If the recession continues, it impacts fast foods, too. Every fast-food outfit has seen a decline in sales. There's no real growth."
But it is precisely because of the precarious economic times that the D.C. Chamber of Commerce gave Brown the "New Business of the Year" award. "There aren't many large start-ups," says Chamber President Malcolm Beach. "Brown is employing 27 people. He's contributing to the tax base and that's to be applauded. He's involved in professional organizations that help the community. . . . His taxes help to keep the residential taxes lower, because we have a business paying for city services. The award was a way of encouraging Merritt Brown."
Some of the former protesters are having a change of heart, too. "The traffic situation turned out to be not so bad. The lot is kept clean in contrast to the situation we had before, although some people feel there is more trash in the neighborhood," Alfred says.
"There are some good and bad things about the business," Brown says. "Certainly I wish there were more sales, but the good outweighs the bad." Despite the setbacks, he says there is a pot of gold at the end of the Whopper.
"I want to expand and have more than one" Burger King franchise, says Brown. "That's my long-term goal."