If you’re not from Chicago, a Maxwell or Cake Shake might not mean anything to you. But it should. That’s because those signatures come from what might be the biggest fast casual you’ve never heard of.
Average annual sales at Portillo’s, which began as a hot dog stand in a suburban Chicago parking lot, today sit at about $8.5 million per store at newer units. When Portillo’s opened in Arizona in 2013, it brought in $438,000 after tax its first week with lines nearly 500 deep. That was enough to gain the attention of Boston-based private-equity firm Berkshire Partners, which acquired the nearly 40-unit chain from its founder Dick Portillo for an estimated $1 billion.
Remarkably, Portillo knew nothing about running a restaurant when he opened that first The Dog House stand in 1963. “I didn’t even know how to steam a bun,” he says. He picked it up quickly, stealthily peeking in the back of restaurants. “We were really struggling at the beginning,” he says. “People have no idea how hard it was. It didn’t come overnight. It came from passion and sacrifice and hard work.”
It also came from some creative business maneuvering, which Portillo exhibited throughout his tenure as head of the chain. When business was off to a slow start at the stand, Portillo asked a customer who owned a printing shop to print a small ad on scraps of paper offering four hot dogs and four fries for $1 in exchange for feeding his family a few times a week. He placed those flyers on car windows in the discount store’s parking lot he shared. Ten minutes later, the line was 20 to 30 people long. From what Portillo credits as his first marketing move, business started to double.