Dick Portillo: The contrarian

He built a hot dog stand into a billion-dollar brand by breaking all the rules.
dick portillo

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.

GET THE WHOLE STORY

Why become a member?

Log in to Restaurant Business for free access to this story and unlimited industry news, analysis and information.

Need to talk to someone at Restaurant Business?

Contact Lindsay Holley

Today's top stories

1
Eatsa, a concept that has made waves with its highly automated ordering and meal pickup operations, is being sued by a disability group that alleges the highly visual setup can’t be easily used by...
2
Starbucks plans to test a line of sandwiches made fresh daily inside stores in its latest bid to snare more lunch business. Sandwiches not sold within 24 hours will be donated to charity as a...
3
Boneless wings are one of those food items customers may not have even known they wanted at first, but these breaded, boneless pieces of chicken breast have turned into a finger-food success story...
4
Knowing the cost of all of the food and beverage you serve is vital to maintaining good controls. When you cost a recipe accurately, you can be assured that the costs of the ingredients you serve are...
5
The private equity firm Oak Hill Capital has teamed up with the management of the Checkers and Rally’s drive-thru chains to buy the twin concepts for $525 million from another investment firm,...
6
Brinker International has shifted the president of its Maggiano’s chain to a marketing and menu-development post at the company's core brand, Chili’s . As Chili’s EVP and chief marketing and...
7
Breakfast continues to be an area of growth and point of focus for operators across segments. But it’s no longer just reserved for the morning hours. Millennials are more interested in breakfast for...
8
Pie Five Pizza has pulled the plug on all eight of its Chicago locations this week as well as its locations in Minneapolis and Denver. The closures came with little notice. According to a statement...
9
Restaurants in Utah are mounting a last-ditch effort to prevent their state from becoming the first in the nation to limit how much alcohol people can drink and still legally drive to roughly one...
10
The parent of the Carl’s Jr. and Hardee’s burger chains has named Jason Marker, the former president of KFC’s domestic operations, to succeed Andy Puzder as CEO. Puzder, who has been CEO of CKE...