In-N-Out Burger Read online

  It was Harry and Esther’s intention to keep In-N-Out Burger a private, family-run business for succeeding generations of Snyders. Harry Snyder had very particular ideas about family and business; he had no interest in seeing his sweat equity disappear into some big company’s idea of what In-N-Out Burger could be. On this point, he and Esther were in sync. His company was his family, but only his family had his blood. Esther was already into her mid-fifties; clearly, Harry’s cancer hastened the need to set up a succession plan.

  Successful family firms are often erected through the sheer will and force of a specific individual. The challenge for Harry was the challenge of all patriarchs—to pass on the company he built to someone who would be able to maintain its success without abandoning the unique culture that had made it a winning hand in the first place and to keep it in the family for successive generations.

  Usually, that someone is the firstborn child. In-N-Out was both Guy and Rich’s birthright. The drive-through was for a time practically their front yard, and they had each worked almost every position in the company, starting with picking up its trash. By having their boys work at an early age, the Snyders had hoped to instill in them a sense of responsibility and ownership. However, all things being equal, the brothers did not demonstrate equal promise to fill Harry’s shoes. Perhaps it was because Harry was the classic self-made man, but he wasn’t going to simply bestow leadership. His successor would have to earn it.

  Guy felt strongly about the family business. But for some time, Guy had demonstrated that if he could be anywhere it would be behind the wheel of one of his dragsters chasing down a quarter-mile of asphalt. Furthermore, his recurrent troubles scarcely made him a strong candidate to take over the business; the crash in Mexico was hardly a ringing endorsement. Guy the so-called wild child had grown into something of a rebellious adult, exhibiting the kind of destructive behavior that prevented him from being named his father’s heir and haunted him for the rest of his life. In some ways, his accident and its aftermath set the stage for the company’s succession plan, which arrived sooner than anyone could have predicted.

  Rich often accompanied Harry during his rounds of doctor’s visits and treatments. Already close, the hours that father and son spent together seemed to bring them even closer. The pair spoke frequently about the business. Apparently, Harry used the time to relay to his son his thoughts and his goals concerning its operations, and his ideas for In-N-Out’s future. Harry also reportedly recorded many of these discussions in a series of home movies. It was clear that Harry wanted In-N-Out Burger to continue, no matter what happened to him.

  Even as Harry became gravely ill, he continued to make plans for In-N-Out. And the future as Harry saw it looked a lot like the past, with a limited expansion into the outlying communities beyond the San Gabriel Valley. In 1975, store number seventeen opened in Santa Ana, the chain’s first drive-through in Orange County. About ten miles inland from the Pacific Ocean, Santa Ana was a growing city, one of the largest in Orange County. Orange County was the home of Disneyland and Knott’s Berry Farm. A longtime Republican stronghold in California, it was also known for its famous beaches—one of them, Huntington, was famously dubbed “Surf City USA.”

  A year later in 1976, when McDonald’s posted $3 billion in sales and opened restaurant number 4,000 in Montreal, In-N-Out opened its eighteenth store in Woodland Hills, a suburb in the southwest San Fernando Valley near the 101 Freeway on Ventura Boulevard. It was another ace spot for the chain. Originally part of the El Camino Real (the Royal Highway) that linked twenty-one Spanish missions, Ventura Boulevard was also one of the main east-west thoroughfares in the Valley and was the original U.S. Route 101 before the freeway was built. The Woodland Hills location, like most In-N-Out Burgers, was positioned to take advantage of the maximum amount of traffic. Heavily traveled, the 101 Freeway in Southern California followed the Pacific Coast to the beaches running down to Hollywood and up to San Francisco and onto Oregon in the north. Additionally, the busy boulevard was flanked with numerous small shops and businesses. This was the third In-N-Out to open in the San Fernando Valley in five years, and customers from all points of the northwest valley made special trips just to eat at the new location.

  The Woodland Hills drive-through was the last In-N-Out Burger opening that Harry Snyder oversaw. He died on December 14, 1976; he was sixty-three years old. Harry’s funeral was held three days later at 10:00 a.m. at the white colonial-style Church of Our Heritage on the sprawling grounds of the Forest Lawn Memorial Park and Mortuary in Covina Hills. It was a fitting final resting place for Harry as well as a slightly odd one.

  Like In-N-Out, Forest Lawn, a chain of cemetery parks, was a uniquely Southern California phenomenon. Just as Harry Snyder re-made American dining with his drive-through burger chain, Hubert Eaton, the founder of Forest Lawn, had revolutionized the funeral industry. In 1917, the somewhat eccentric Missouri-born businessman created a chain of memorial parks across the Southland that broke with what he believed was the usual dreary and depressing cemetery setting. Featuring scrupulously manicured grounds lined with trees, fountains, music drifting out of speakers hidden in rose bushes, and grave markers flush to the ground to give them more of a park feel, Forest Lawn parks were built to be as “unlike other cemeteries as sunshine is unlike darkness, as Eternal Life is unlike Death.” *

  Eaton commissioned hundreds of statues and artwork including reproductions of some of the world’s most famous works of religious art, such as thirteen mosaic scenes of Michelangelo’s Sistine Chapel (as well as kitschy original renditions: a 172-by-35-foot mosaic depicting twenty-six famous scenes from the earthly life of Jesus) to decorate the Forest Lawn chain. Eaton introduced a “pre-need” program that allowed people to see to their own funeral arrangements before they died. Soon, Eaton lured couples to marry in the chapels on the cemetery grounds. It was at Forest Lawn’s Wee Kirk O’ the Heather Church that Ronald Reagan married his first wife, actress Jane Wyman, on January 26, 1940.

  On a warm winter morning, Harry’s funeral mourners filed into the 120-seat church, a replica of St. George’s Church in Fredericksburg, Virginia. The chapel was too small to accommodate the hundreds of mourners who had come to pay their last respects to Harry Snyder, and many stood outside. “He really touched a lot of folks,” said Russell Blewett, who attended. Numerous associates and community residents arrived. It seemed that everybody that he ever had contact with arrived to say good-bye. The Snyders’ good friends Carl and Margaret Karcher, who had stayed close through the years since they first met and offered Harry advice on running a fast-food shop, paid their last respects, too. Three years later, the Snyders’ foster son, Wilber Stites, was killed in a car accident. He was buried near Harry at Forest Lawn.

  When Harry died, the question of what would happen next to the popular little burger hut with the red-striped awning had already been decided. At fifty-six, Esther Snyder was now a widow with few financial concerns. She might have easily jettisoned the chain and taken up a life of early retirement; instead, she agreed to carry on. In fact, Esther insisted upon doing so. She simply cared too much about the welfare of her associates to abandon In-N-Out. They had shown such loyalty to the Snyders that she couldn’t imagine pulling the rug out from under them now. Besides, she was still devoted to Harry, and In-N-Out was his legacy. “I think she just didn’t know what else to do,” remarked old family friend Valerie Althouse. “Esther never sold it because of Harry. It was a family business. Just about everyone working there had been there since the 1960s. They had become like family.”

  For a short time, there was some thought of Rich possibly doing something else. This was, however, mostly fueled by a brief spasm of personal doubt. Although he had not attended college, Rich had learned the business by working there. In short, he feared that he might not have what it took to run In-N-Out Burger. On a few occasions, Rich delicately broached the idea of selling the company with his father before he died. But Harry dismissed his so
n’s misgivings; he’d put his arm around his son and tell him, “You can do it, Rich.”

  Seven months shy of his twenty-fifth birthday, Rich Snyder was named president of In-N-Out Burger, and whatever reservations he had, he had quickly pushed them aside. Esther was given the official title of secretary-treasurer (she also retained controlling interest in the company). Guy was named In-N-Out’s executive vice president. But Rich was also named the trustee for his father’s estate and trust instrument. For all intents and purposes, Rich was given the keys to the family’s growing burger kingdom. Guy Snyder was passed over in favor of his brother.

  Practically speaking, the decision to hand the company over to Rich was both sensible and prescient. In retrospect, it was the plot point that turned In-N-Out from a local eatery into one of the largest family-owned restaurant chains in the country, competing head-on with the fast-food giants. Of course, as with most plot points, the narrative doesn’t turn without a certain dramatic tension—and that tension was derived in no small part from the relationship between the Snyder brothers. The upending of primogeniture created a conflict between the two brothers whose relationship was already exacerbated by personality clashes. It had the emotional intensity of the biblical story of Jacob and Esau without, of course, the bloodlust or deceit. As his longtime friend explained, “Guy never said outright, ‘I really got screwed over by dad’ or anything. Guy knew he had a problem with the drugs and I don’t think he ever questioned why he was passed over. But to tell you the truth, he was hurt nonetheless.”

  Outside In-N-Out’s fortified walls, the wholesome image of the company remained intact; behind them, however, there was a small fissure, like a hairline crack in a crystal vase.

  CHAPTER 10

  Harry’s confidence in his youngest son was not misplaced. Whatever initial misgivings Rich may have had, they were nowhere in evidence when he seized the reins of the family business. In-N-Out’s new president took up his position filled with the kind of determination and enthusiasm that characterized him both inside the fast-food industry and outside of it. Arriving early each morning at the chain’s nondescript Baldwin Park offices (where Snyder Distributing was housed across from store Number One), Rich cut a commanding if not boyish figure, aided perhaps by his large girth. Not yet twenty-five years old, he was almost always dressed in a suit and tie, and just as often a broad smile. Rich possessed the kind of clean-shaven face that seemed to magnify his already youthful appearance.

  It was not, however, an entirely smooth transition. Very quickly, Rich discovered that some of the associates that he had considered to be his friends did not always have his best interests at heart. And at twenty-four, he realized that he had a lot to learn. When describing this period of adversity and hard knocks he later said that “the bumps along way just help to develop character.” However, from that point forward, Rich never again considered selling In-N-Out. The very idea had become a taboo subject.

  By the time that Rich took over In-N-Out Burger, the fast-food landscape was clearly different from the one that his parents had helped establish. For starters, there was a strong public perception that hamburgers were mostly junk food; the industry was now stuck with the negative reputation it had earned as a business of cheap, low-quality food prepared by disposable, underpaid workers. Still, despite its bad press, the fast-food world continued to prosper. In 1976, the United States was celebrating its bicentennial and the fast-food industry was ringing up $16.3 billion in sales. As it continued to grow at home, the business had gone global.

  For Rich, a man who believed in the hamburger like he did the American flag, the public’s gloomy perception of his business was particularly irksome. It was an opinion Rich didn’t share in the least—he had nothing but respect for the hamburger business, especially In-N-Out.

  Whether Harry expected Rich to follow in his cautious footsteps is unclear, but certainly his son had some ideas of his own. Unlike many heirs who seek to make their mark on the family firm by completely remaking it, when Rich took over In-N-Out Burger he saw the wisdom in maintaining his parents’ 1948 formula. To his credit, Rich wasn’t tempted to tinker with In-N-Out’s limited set of offerings even as his competitors had, for some time, rapidly expanded their own. In the chain’s history to date, it had only added one new product to its menu—and that was the soft drink 7-Up. “It’s hard enough to sell burgers, fries, and drinks, right,” was how Rich explained his reasoning. “And when you start adding things it gets worse.”

  In-N-Out’s limited scope and narrow focus also meant that the chain didn’t have to continuously spend money on new equipment needed to prepare and cook new menu items. By the same token, it wasn’t necessary to repeatedly train its associates to learn how to ready those new offerings. And without shareholders peering over their shoulders, the Snyders were free to spend their money where they wanted—and that was on maintaining high standards.

  That’s not to say that Rich Snyder did not have his own dream for the future of In-N-Out Burger; in fact, he had big plans for the chain. His vision mirrored his father’s with one exception. If Harry was a man who was satisfied with his limits, his son was a man who saw greater potential. By the time Harry died, he was happy with the small clutch of stores that he had prudently rolled out across the Southland. Those who knew him said he was reluctant to push the chain much beyond that. The eighteen In-N-Out units ringing the San Gabriel and San Fernando valleys as well as Orange County were a sufficient measure of success, to his way of thinking.

  His son, however, had his own measure of success. The chain that Rich had inherited was a cherished brand with a devoted following. In his mind, Rich firmly believed that he could maintain his parents’ model of simplicity and quality while greatly expanding In-N-Out Burger. Initially, he decided to venture farther south of Los Angeles County, push farther into the fast-growing Orange County, and move into new territories, starting with Riverside and San Bernardino counties. “Rich was very unique,” explained his cousin Bob Meserve. “He had a lot of his dad’s qualities. But Rich was shrewder as a businessperson. Harry was old school and Rich was new school. Rich had a vision. He knew what he what he wanted to accomplish.”

  What Rich was not, however, was a college graduate. Despite his considerable natural talents, it was something that seemed to leave him slightly insecure. His dyslexia, diagnosed only when he was an adult, amplified the feeling. Close observers noted that Rich lacked the polish of many executives, but what he lacked in luster he more than made up for with his genuine ability to connect with people. When he gave a speech, more often than not, it came straight from his heart.

  In any event, Rich strove to continually improve his management abilities, taking advantage of opportunities to expand his own education at every turn. He cobbled together his own kind of degree, attending leadership seminars and classes and seeking out mentors. Rich became active in a number of business organizations and peer groups where he met and mingled with other Southern California business executives. He belonged to the networking group The Executive Committee (TEC), made up of twelve company presidents from various businesses and industries. He also joined the Young Presidents’ Organization, a worldwide peer group exclusively for CEOs and presidents of companies who were under the age of forty-five.

  The affiliations gave Rich the opportunity to mix with other self-starters as well as second-and third-generation businessmen who had also inherited their family businesses. They provided a kind of fraternity as well as forums in which he could candidly and safely discuss issues, solve problems, and exchange a range of ideas on everything from marketing to taxes to human resources. Within this circle, Rich was universally well regarded for his energy, enthusiasm, creativity, and his obvious gifts as a leader.

  It was during this time that Rich met Jack Williams. Originally from Clovis, New Mexico, Williams and his wife, Linda, were longtime restaurant business veterans. The couple had come to California in 1954, when Williams was part of the U.S. Marine
Corps and was stationed in San Diego. In 1957, the couple began working in the food business, and in 1969 they opened their first restaurant, a Sizzler Family Steakhouse. First established in 1958, Sizzler was a pioneer in the fast casual dining segment and became known for its reasonably priced steak dinners and all-you-can-eat salad bar. Williams went on to become one of its largest franchisees.

  The two men had frequently run into each other in industry circles. But when Rich and Williams sat on the board of the California Restaurant Association together, they became fast friends. Williams’s initial impression, he recalled, was that Rich “was blessed with a tremendous amount of common sense and a lot of business ability,” and he possessed a real determination to improve and learn.

  Although Williams was eighteen years Rich’s senior, the two men spent a lot of time together problem solving, attending training seminars, and generally using each other as professional sounding boards. The pair served on each other’s advisory boards; they shared an interest in the operational details at every level, frequently eating at each other’s restaurants, reporting back any problems. “Many times I told him about little things,” remembered Williams. “They wouldn’t be noticed by the public.”

  Williams and his wife owned a ranch down in Temecula in Riverside County, a town known for its floating pageant of hot air balloon festivals, and Rich came down at least once a month, often arriving by helicopter. There they rode horses together. In fact, after Rich bought his own copper red Tennessee Walker (whom he named Ernie), he boarded him for a time at the Williamses’ ranch. In Temecula, the two friends fell into a routine of packing a lunch of peanut butter and jelly sandwiches and riding the property out to the nearby campgrounds while talking about businesses matters. “We’d ride up there and go sit under the oak tree and work on our employee handbooks,” Williams recalled. “He had a real innate sense.”