Sunday Interview: Jack Pezold discusses starting businesses, owning over 20 McDonalds and family life

chwilliams@ledger-enquirer.comMarch 29, 2014 

Jack Pezold was raised on a farm in Missouri.

The fourth of nine children, he quickly discovered that farm life was not for him.

“Growing up on a farm is tough. ... At a pretty tender age I figured out I didn’t like things with a handle,” Pezold said last week. “We raised vegetables. That is not machine work. That is stuff on your knees; bending over and cutting cabbage; operating a hoe and manure fork.”

Pezold took another path that led him from St. Louis to Columbus. Now 70, he has been a successful businessman — “blessed” as he calls it.

He owns a string of McDonald’s in the Columbus region and has diversified into textiles, hotels and other investments.

Pezold sat down with Ledger-Enquirer reporter Chuck Williams to discuss his success, grandchildren and many other topics.

Here are excerpts of that interview, with some of the questions edited for length and the order of some of the questions rearranged for clarity.

How many hamburgers have you sold?

I don’t have any idea.

Ballpark figure?

We have been blessed. We have sold a lot of hamburgers. ... I have no idea. I try and look forward. I don’t look back.

When you got here in 1980, did you think you would spend 34 years here?

I wasn’t thinking that far ahead. I was thinking in terms of getting beyond that 18-percent interest rate.

That wasn’t a very good time to be buying franchises, was it?

Marshall Raff, who was the operator, had stores here and in the Gainesville-Ocala, Fla., area and in Tennessee. McDonald’s was putting some pressure on him to move one place or another. He moved to Florida and wanted to sell these.

How many did you buy?

It was six stores. Four in Columbus, one in Phenix City and one in LaGrange.

You owned McDonald’s restaurants before you got here, right?

I was over in Dublin. We had three stores — Dublin, Vidalia and Sandersville.

How do you go from being an accountant in St. Louis to owning McDonald’s restaurants in south Georgia?

I was a CPA and had a couple of McDonald’s clients, a couple of young guys who each had one store. I was helping one of them out on the way home from work one day. He was having problem with his shake machine, so I had out the manual and I was working on it. One of the McDonald’s executives came by and asked what I was doing. I told him. He said, “Why aren’t you an operator?” I said because I was not a millionaire. I was a struggling bean counter. He got me an application to put in for a McDonald’s.

So, you applied?

I applied and they didn’t answer my inquiry. So, I called the guy in six weeks. His name was Bill Coates in the Chicago region. I called him up and he said, ‘Oh, you are that damn bookkeeper.’ Touche, huh?

You ended up getting a franchise?

They would not even talk to me up there. There were two frontiers left in McDonald’s. One was in the Atlanta region and the other was in Dallas. He said, ‘I know the guy in Atlanta, his name is Doug Mack. I will call him and see if he will talk to you.’ I drove to Atlanta, talked to them, put down $10,000 for a deposit. You start the process, now you go on a list. I was No. 13 on the list. You keep working your way down. They placed one operator in the Atlanta region every month. It was 1973. It was August, then it was September. I was a CPA, so you had tax season coming up. ... October 1973, the Arab oil embargo hits.

What did that do to the list?

We were going though Watergate. Got the Vietnam War winding down. They are getting ready to impeach Nixon. The Arabs double the price of oil overnight. The price of gasoline went from 25 cents to 50 cents a gallon. It was the pits. There was a store under construction in Dublin, and they didn’t have an operator. They went through all these guys on the list. All of them said, “No way.” Dublin was a little town of 16,000 people. I went to lunch with the banker down there. He said, “Jack, I don’t understand why somebody would come from a big city like St. Louis to Dublin, Ga., and sell cheap hamburgers.” I said, “Well, Mr. Smith, I plan on selling a lot of hamburgers.” Hamburgers were 25 cents at the time.

What was you initial investment for that Dublin store?

It was about $130,000.

Why Columbus?

We lived in Dublin. It was 40 miles to Vidalia and 45 miles to Sandersville in a different direction. I didn’t see a lot of opportunities.

Over the years you have grown that?

We have 22 stores. That includes a couple of Walmarts. Hogansville is the farthest north we go. Do you remember what you thought the first time you visited Columbus? My wife, JoRhee, she grew up in Adrian, Ga. They were playing in a basketball tournament in the old civic center when she was a child. The first McDonald’s she ate at was at Macon Road. I had never been to Columbus. We drove over here, and I had some real reservations about it. JoRhee thought it was great. The Fort Benning thing was winding down. We had 18-percent interest. It was a mill town.

Was there ever a point where you didn’t think you were going to make it?

Yeah. JoRhree and I were sitting down at dinner one night, and I said, “JoRhee, I think this is the biggest mistake we have ever made.” We came over here and put on a couple of drive thrus, we put on a couple of outdoor PlayPlaces. ...

What do you mean?

Well, to give you an example at the time, McDonald’s had 23 regions in the country. The Atlanta region was No. 22 out of 23 regions. This market was dead last in the Atlanta region.

You made a bet on Columbus?

Oh, yeah. You know, I trust JoRhee’s judgment and she really felt this was what we needed to do. I was going to do the best I could. And she really got involved in training.

So, it was a family business?

Yeah. And we had two small children, John and Stephanie. John was a baby and Stephanie was about 2.

When did you feel you had made it?

Fort Benning was starting to turn around. We relocated a store on Victory Drive and we moved down the street. We had a grand opening ... and a march from the Traffic Circle. It was 1982, Harry Jackson was the mayor, A.J. McClung and we had all these people marching. We paid them 50 cents a head that we gave to the South Columbus Concerned Citizens. I think they made $1,000 or something like that. The store really took off.

You had a murder in that store, right?

Two weeks after it opened. Two guys robbed a liquor store the night before and they were divvying up the booty and they got into an argument. One guy starts shooting on the other side of Victory Drive and the guy runs into the new McDonald’s and stands at the front counter. The guy comes up to him and says, “You SOB.” Bam. Bam.

I see you are tearing down the McDonald’s in Bradley Park. What is it going to cost to rebuild that McDonald’s?

Total, about $2.5 million.

What are you doing with that store? That was a small store built in 1995. It had a small dining room and a PlayPlace on it. It was one we couldn’t modify to make it into a current store. This is going to be a nice-looking brick store that is more fitting for the neighborhood.

Are you amazed at the progress this city has made?

Definitely. Look at Columbus State. Look at TSYS. Look at Synovus. Look at the renaissance that has taken place downtown.

What do you attribute that to?

I think we have lot of fine, fine people who have invested in downtown — the Turner family primarily. They were forward-thinking. Mr. Turner could have taken his money and said, “Hey, I am going to live the good life” — not that he has lived a bad life. ... He was a real visionary who made some changes downtown.

You still own the Marriott downtown. Is downtown more conducive for business now?

I think so. My wife and I went down to something at the RiverCenter a couple of weeks ago. We were just amazed we couldn’t find a parking space. That is not the downtown that we had before. I heard stories about George Woodruff talking about what to do with the Historic District. He said, “The best thing I could do was pull a bulldozer down there.” Fortunately, there were people who had cooler heads and saw the opportunity. The Public Safety Center moving from where they were next to the Government Center to where they are now so they could put in the RiverCenter. And all of those loft apartments; and CSU moving downtown. It has been huge. Have you ever been to one of those free concerts on Sunday afternoon at the RiverCenter? We were with another couple and they had a guest from New York City. She said this would cost $250 to pay for a ticket.

Since those days, you really diversified your business. You are not just the McDonald’s guy any more?

We were in the television business and we sold the television stations here and in Augusta to the Disney family. I owned Fox 54 here, and the Fox affiliate in Augusta.

You own a geothermal company, Valley Hospitality, aviation interests and a textile company. You look like a venture capital firm, right?

Well, you see some opportunities. I was always interested in energy efficiency and that is how I got into the geothermal thing. We got into the hotel business after we sold the TV stations. I wanted to get into something a little less labor intensive than the restaurant business.

What about Denim North America, the textile company?

... Marubeni owned it and they were going to close it. It was 330 good, high-paying jobs that were just going to go away. That was one of the things we did to save the jobs. We didn’t know too much about the denim business.

What do you know about the denim business now?

A lot. I still don’t know much, but more than I did then.

Do you have Midas touch?

I admit luck beats good. I try to make good decisions. They are not all good. I was the fixed base operator at the airport for a number of years. I was in the charter business. We lost tons of money on it. Aviation is a small fortune deal. You start with a large fortune and you operate it for a few years and you wind up with a small fortune.

What advice would you give a 30-year-old person who is looking at a franchise today?

It’s a tough business. It is a lot of work and lot of employees. We have really been blessed. McDonald’s has great training programs, and you build an organization. But it has been hard, hard work. There are no guarantees. You get out there and open for business, and hope like heck they come. You got the banker over here waiting for you, and you got employees waiting for you. You got your suppliers waiting for you. The first year I was in business, I made $10,000.

You have opened a health clinic for your employees, right?

Yes. Right now it is available to all of our full-time employees and their families. That is about 35 percent of our 2,400 employees. We are trying to keep them out of the emergency rooms and provide them a place for the initial visit. We are working with them on wellness and it helps offset initial costs. It is a $5 copay for a visit and $5 copay for prescriptions. We are looking at opening to all of our employees.

Do you look at things differently at 70 than you did at 50?

Yeah. You know, you get grandchildren and you start realizing that you are 70 years old. I never imagined myself being 70 years old. ... You have to learn to recognize your limitations. I don’t have the stamina I once did.

Do you like being a grandfather? You have four, right?

It is far better than having children.

Why do you say that?

You really enjoy them and their parents take them back home. Sometimes they spend the night with us, and we love to have them do that. It is just a different perspective. When our children were young, we had just moved to Columbus. We were struggling with the business. You didn’t have all that time. Every night you were home by 8 or 9. Every day is a 14-16 hour day.

You are enjoying it more now?

I just have a great relationship with all the grandchildren. They call me “Papa.”

I you look at a lot of your philanthropy, it has been kid-related: The Ronald McDonald House, the Woodruff Farm soccer complex. Is that by design?

On the soccer complex, I always felt kids needed exercise. They needed to learn coordination. They needed to run. Outfitting a child for soccer is minimal compared to football or baseball. So, it made sense. And the kids were playing soccer at the old Bibb field — broken beer bottles and all that. We have a great soccer complex now.

What did you tell John when he came to you two years ago and told you he was thinking about running for the General Assembly?

Well, that’s interesting. John worked for Mac Collins and he got it in his blood. I kind of encouraged him. I encouraged him when Vance Smith took the DOT job. He had a small baby at the time and he filed it away. Kip Smith won and got re-elected. John had been involved in the chamber’s Young Professionals. He felt the time was right. I am proud of him. He has upset some folks up there. He is not a rubber stamp.

Where did he get that from?

(Laugh). He must get it from his mother. (More laughter).

Where do you stand on the potential raising of the minimum wage?

I was afraid you were going to ask me that. Probably what we need is a sub-minimum wage for entry level employees. Talking about 16, 17 year olds on their first jobs. The reality is if you go to $10 an hour and have a 50-percent increase in wages and the payroll taxes, it is going to inflate the prices. Instead of hamburgers being $1, maybe a hamburger is $1.50.

It will eventually get passed on to the customer?

Absolutely. It has to be.

Have you had a friendly rivalry over the years with Marvin Schuster and the Burger Kings?

Marvin has done a great, great job and he has been a great corporate citizen. Marvin was here when we came. He had the advantage of owning his own real estate, where McDonald’s owns the real estate and we are kind of the hamburger sales guy. On balance, that is a better deal. You got fixed costs. Marvin is able to build his own buildings. Push comes to shove, he doesn’t have to pay that rent to Burger King. He pays a royalty.

Is this a fast-food town?

I think we are getting an awful lot of fast food. When we came here, there were not a lot of places to eat. But there sure are now. You go out to Columbus Park Crossing and that is amazing. I don’t think anybody cooks at home.

Where do you eat when you are not eating at one of your restaurants?

We eat at home a lot. I tell you, we enjoy going to Henry’s on Hamilton Road. Good Cajun food.

Are you really taking classes at Columbus Tech?

I have been. I am taking air conditioning and refridgeration courses. I am just trying to learn like everybody else in the class. I enjoy it.

What accomplishment are you most proud of?

I have a wonderful family. I have a great supportive wife, and she is beautiful. She’s lovely. We have a good church. We’ve got good kids. I am not one to dwell on accomplishments.

You try not to look back?

We were talking about that in the Bible study this morning. You can look back and develop a pride in what you have accomplished or else you can look at it and you have some recriminations and Satan goes to work on your brain. What you do is lose your focus on going forward. Yesterdays are history. You can’t do anything about it. You got 24 hours in a day.

Jack Pezold

Age: 70

Job: President of Pezold Management Co., which operates 22 McDonald’s restaurants in the Columbus region. The company also owns Valley Hospitality, which operates five area hotels, Geo-Energy Solutions and Denim North America.

Education: Corpus Christi High School, Jennings, Mo., 1961; St. Louis University, accounting degree, 1966. Family: Wife, JoRhee; Children Stephanie, John and Joshua; Grandchildren Eleanor, Jack, Will and Hamilton.

On his dog Rusty: “His mother is a pedigreed long-haired terrier and his father came from a good neighborhood,” Pezold said of the mixed-breed rescue dog. “When I had a heart attack (seven years ago), Rusty would not leave my side. When I came back to work, he would sit at the door and whine. JoRhee said, ‘Take him to work.’ I told her I can’t do that. Her response was, ‘Who’s going to tell you you can’t?’”

   

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