INSIDE DISH: Nostalgic Shallos does brisk business swiftly

Welcome back to IBJ’s video feature “Inside Dish: The Business of Running Restaurants.”

Our subject this week is Shallos Antique Restaurant & Brewhaus, one of just a handful of full-service restaurants in the immediate Greenwood area when it opened in 1981. The burg has evolved into a retail mecca since that time—some would say it’s overbuilt—but Shallos conspicuously remains the same. A thinly veiled knock-off of T.G.I. Friday’s at its inception, the nostalgic and neon-laced eatery has managed to create its own identity and thrive by simply doing what it has always done as efficiently as possible.

“What we’re about here is putting out great food, having a great selection, and getting our food out quickly and turning tables,” said founder Paul Shellabarger, now one of three equal partners in the enterprise.

The irony central to Shallos is that a place so populated with hardwoods, antiques and throwback knickknacks intended to reflect a more relaxed era continually pushes to prepare and deliver its comfort-food vittles with such dispatch. Even during its most busy shifts, servers and line cooks are expected to produce appetizers nearly immediately and entrees within 15 minutes of the customer’s order. A typical stay for a three-course meal is a bit less than an hour.

“If we can turn these tables over and over and over, that just equals money,” Shellabarger said. Gross sales have risen consistently, hitting $1.3 million in 2010 and growing to a record $1.6 million in 2011. Projected sales for 2012 are $1.8 million-plus. Shellabarger declined to discuss profit.

With the help of two friends, Shellabarger opened Shallos in a strip center on the northeast corner of U.S. 31 South and County Line Road, across from what is now Greenwood Park Mall. Although a Greiner’s SubShop franchisee, Shellabarger was a newbie to full-service dining and used favorites like Friday’s and Dalts Classic American Grill as templates.

“We knew absolutely zero,” Shellabarger said of running the eatery, which he debuted in a 2,000-square-foot space with $25,000 in startup investment. “We picked items that we liked for the menu, and we didn’t take into consideration holding times, prep times, cooler spaces—any of those things.

“One thing that kept us in business is that we were able to adapt quickly.”

To speed up prep times, Shellabarger pruned and retooled the menu to focus on items that could be produced quickly and speed table turnover. That meant taking pizza off the menu, for example.

“It was a really big seller, but people would come in and order pizza and camp here for an hour and an hour and a half, and it would really cost us revenue, because we’d go on a wait [at the door], and people wouldn’t want to wait,” he said.

The eatery took a giant step toward greater efficiency in 1991 when it moved to a larger, 3,700-square-foot location in the same center with expanded kitchen and storage space. Relocating required $180,000, which included a $30,000 bank loan. Shellabarger, who invested in real estate on the side, saved by serving as general contractor.

In 1997, Paul Zoellner joined the staff as general manager. Several years ago, Zoellner and kitchen manager Tim Shilling became equal partners with Shellabarger as the founder sought to take a step back from the day-to-day grind of minding the shop.

The three owners brainstorm at least once a month about how the restaurant can become even more efficient. In the video at top, Shellabarger and Zoellner discuss how they use a computerized kitchen display system to chart food-prep times and alert managers when tickets cross preset baselines.

“We’ve learned that we do some things that probably aren’t quite right. Like, our food might come out too fast, though we find more people would rather have their food in front of them and then go on and do other things,” Shellabarger said. “So we kind of buck the trend there a little bit.”

After 31 years, Shallos is approaching a potential turning point. At 61, Shellabarger is reconsidering his role as co-owner and thinking about simply focusing on his real estate holdings. The future of the restaurant could rest with Zoellner and Shilling, who are a generation younger. In the meantime, the owners are preparing to head into negotiations regarding a five-year option on their lease.

“Our challenge is, do we want to continue on with this business?” Shellabarger said. “Do we want to sell it? What do we want to do?”

Shallos Antique Restaurant & Brewhaus 8811 Hardegan St., Greenwood (northeast of U.S. 31 South and County Line Road) (317) 882-7997 www.shallos.com Concept: Family-friendly restaurant in the mold of a 1980s-style T.G.I. Friday's, with a bar that specializes in rare and foreign beers both on tap and in bottles. Founded: 1981 Owners: Paul Shellabarger, founder; Paul Zoellner, general manager; Tim Shilling, kitchen manager. Startup costs: $25,000 in 1981, including a $15,000 commercial bank loan; $180,000 when moving to a new location in 1991, including a $30,000 bank loan. Gross sales: $1.3 million (2010); $1.6 million (2011). Employees: 50 Seating: 150 Goals: To begin renegotiating with the landlord on an option to extend its lease, as well as to continue discussions between the three co-owners about the future of the restaurant. They need to determine whether they're interested in moving or staying put, and whether Shellabarger will essentially retire from the business and cede more control to Zoellner and Shilling. Good to know: Shallos uses an extensive collection of beers (42 on tap and some 400 in bottles at any given time) as a hook for customers, but its sales still heavily favor food (70 percent) over potent potables (30 percent).