Wednesday, August 15, 2018
Business

Front-line business lessons from Checkers' 'undercover' boss

Burger-selling Checkers' chief executive, Rick Silva, at first wanted to run the other way when producers of the CBS TV reality show Undercover Boss approached him to film a segment.

"I did not want to do this show," Silva said Friday. Why not? "This smells," he thought at first. "It was worrisome. I can't control the environment."

Nevertheless, the Tampa CEO of the 800-restaurant fast-food chain saw an upside for some publicity for Checkers, a modest-sized burger business scrapping against such behemoths as McDonald's, Wendy's and Burger King — not to mention dozens of other fast-food options from fried chicken to tacos.

Checkers knows exactly what it's selling. One of its slogans is "permission to indulge" and the chain sells a fifth or more of its beef-, cheese- and bacon-laden burgers and fries late at night to folks who, Silva says, are definitely not looking for a salad.

In the end Silva, 47, opted to do the show, which he says interviewed 100 CEOs for just 13 spots. "I decided to suck it up and take the risk."

And there is risk. An earlier segment of the show featured the CEO of the Hooters restaurant chain. He was later criticized for not firing a restaurant manager on the show after making waitresses eat servings of beans without using their hands.

How did Checkers fare? Silva's Undercover Boss segment aired in February with a rerun showing last month. It proved a hit, winning an Emmy for the CBS reality show and giving a big publicity boost to Checkers. Silva says the show not only increased its customer business but created a big buzz in franchising interest.

Silva figures the show generated the equivalent of $20 million in advertising for Checkers, effectively doubling its ad budget for the year.

What Silva didn't mention is that the show also raised Checkers' profile at the same time the private company has been put on the sales block by its private equity owner, Wellspring Capital Management.

Checkers was purchased for $188 million by Wellspring in 2006. Industry watchers expect the chain to go for more than $300 million.

•••

For those unfamiliar with the premise of Undercover Boss, the reality show features CEOs who are disguised to avoid being recognized by their own employees. They are the filmed as newly hired, low-wage employees on the front lines of their own business. In Silva's case, he's making burgers and fries and running the late-night cash register at Checkers locations in several states.

The show was filmed at Checkers locations ranging from Homestead and Tampa to Toledo, Ohio, and Flint, Mich. Not all locations made the final cut.

Silva, whose family came to this country from Cuba, is balding, talks fast and has a quick sense of humor. For his disguise, he wore a realistic wig and a fake mustache made of yak hair that had to be meticulously glued on and tickled his nose.

None of the Checkers workers recognized their CEO, Silva insisted, though a company auditor seemed suspicious of the premise of a reality show being shot at Checkers.

Silva says the film crew explained to Checkers workers that they were there to shoot a show called Second Chances about a guy (Silva) who had failed in his last venture and was trying to make a comeback. Checkers fast-food workers paid $6 or $7 an hour were told they were supposed to train their "new employee," then decide if he was deserving of as much as $100,000 from the Second Chances show.

That was enough of a ruse to explain the film crew at Checkers locations. Silva admits the Undercover Boss scenes that made the final cut — none of which he saw until the show aired — featured employees with livelier personalities.

In one scene at a Checkers in a tougher part of Carol City near Miami, Silva ran the late-night cash register while his manager kept telling him to keep the walkup window shut for security reasons. A good percentage of customers late at night — big business for Checkers — are at times "inebriated," Silva acknowledged, and were hard for him to understand. Given that, and his unfamiliarity with the register, he simply charged everyone the same price.

The Checkers segment took a more dramatic turn at a Homestead location. As a newbie employee, Silva witnessed the local manager berating workers. When the CEO, still disguised, tried to ask the manager if he was just having a bad day, he was rebuffed. At some point, Silva had seen enough and — despite the cameras filming — revealed who he was. Silva told the local manager that's not how Checkers operates, then immediately closed the Homestead location until a new manager could take over the next day.

Silva recalled telling himself "Bad call, Rick" to take such an action while on a reality show. Who knew how that would be portrayed on TV? But the quick intervention proved the right thing to do and, apparently, came across well on Undercover Boss.

"This put a face on the business," Silva says, showing what the top executive at Checkers stands for: strong ethics, if not caloric restraint on his menu.

Robert Trigaux can be reached at [email protected]

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