Henrik Winther, managing director of the Rosinter chain of restaurants and hotels in Russia and the C.I.S., spoke to the Leader about his experience in running the restaurant business in general and, in particular, about the philosophy he says makes Rosinter stands out in the sector — the philosophy of not just selling food and beer, but of selling the "feeling of having a good time."

Please tell us about your educational background.

I was born into a hotel-business family. I attended primary school in Denmark and, later, moved to Nice, France, with my parents, where I went to college, specializing in restaurant/hotel management.

Where did you work before relocating to Russia?

When my parents moved from Denmark to France, they set up a hotel business, so I can say that I grew up in the restaurant and hotel business. It was only natural that after graduation I worked there for some time. Later, I worked in other hotels both in France and in the United States, including in the Marriott Hotel chain.

What were your expectations when you were asked to relocate to Russia for the first time?

Coming here for the first time in 1991 was an adventure. The feature that struck me as very odd back then was the monotonous grayness of the city and the conspicuous absence of any commercial activity or signs on the buildings where something resembling commercial activity was going on, at least at the level that I was used to.
Actually, I came to Russia more out of curiosity than the need for employment, because, in all of my years in the business, I had never seen an ad for a job in Russia. So, when I saw one I contacted the people, and since it came with a free three-day visit to Moscow, I decided to come and have a look, not knowing that it was the first step in building a career in Russia.
Beside the general grayness that pervaded the country then, it was very clear to me that this was a virgin, wide-open market, which, when positively tapped, could yield excellent outcome.

How did you overcome the language, cultural and business-ethics differences, considering the system practiced here at that time?

The language was the least of all the problems. The most difficult was the huge cultural chasm, especially during the process of opening the first venue. It was very difficult to work with people who did not completely understand what you wanted, especially as they never saw the end product, and all the discussions, including the conceptual aspect of what we wanted — food, service and so forth — were abstract to them. This was the most challenging stage to me.

Having run Rosinter for over 10 years now, how would characterize its position on the C.I.S. market today?

We have 67 restaurants in Ukraine, Belarus, Hungary, the Czech Republic, Vienna and Russia. Apart from Moscow, in Russia we have outlets in St. Petersburg, Omsk and Novosibirsk. I can boldly say that we are definitely the leader in the concept-restaurant sector, especially in the casual-dining segment, just as McDonald’s, for instance, is the biggest in the fast-food segment.
I’m not only talking about the quantity of outlets; I also mean how a company is run — professionally, rationally, mapping out the right strategy, setting the right priority — our company is among the top best in these aspects. These are very important because we are in the business of marketing a special or, better still, a unique product — the feeling of having a good time.
Anybody can sell food and beer, but what makes a restaurant special is how the client feels when he leaves. The extent to which our clients feel satisfied when they leave is proportional to the professionalism of the staff. This is particularly important because we are in a "people business," which means we are not selling just food, but also feelings. Accordingly, the staff is trained to feel good themselves, because only happy people can make others feel happy and relaxed too. Management’s policy is clear on this issue — combining our core business with making people feel good, relaxed, entertained and well treated.

Who runs this extensive network spread all over Central and Eastern Europe and parts of Asia?

We have a president who is in charge of the strategic development of the company, but I’m the person in charge of everyday management such as supplies, quality control and other aspects of business in Russian, the C.I.S. and the Central European countries.

Does such a rigid and extensive schedule leave you with any free time for private leisure?

I have always been a workaholic, and I cherished the earlier wild days here, as it was a perfect setting for someone like me because there was so much to do. Though I still retain the workaholic posture, I now have much more free time to myself, as we have been successful in building a strong and professional management team.

What is your employment policy?

We have more than 3,000 employees, of which only a handful, such as chefs, are foreigners.
Apart from this small group, the management team, right from the top to the bottom, is Russian. Our personnel policy is focused on in-situ development of our human resources. It’s very difficult to hire people from outside, or even from within the industry, and expect them to grasp the company’s core principles that I have just talked about.
These principles are something one grows to understand within our organization. So our modus operandi is hiring good people and training them to the required level as well as providing them with opportunities for personal and professional growth within the company. This is because we have long realized that we can achieve our objectives and maintain them only if we are professionally staffed.

What is the restaurant sector’s gross annual turnover in Russia?

This is a rather difficult question because restaurant business is a fragmented. I can only give a gross estimate. If we assume that there are about 2,000 average-quality restaurants with an average annual turnover of $50,000, then we have a rough guess of what the annual turnover is nationwide, with Moscow accounting for up to 10 percent of this figure. Here again, I must stress that this is only a very rough estimate.

What is your opinion of the present economic situation in the country?

Last year was a fantastic year for us as we made huge progress due largely to two factors — the generally improved economic situation and our internal-policy focus on our core business. However, the fourth quarter showed a slower rate of growth, but it was still positive. We expect this positive trend to continue this year.

Bearing this in mind, could you tell us more about your plans for 2002?

We are planning to open about 40 new restaurants in 2002, more than half of which will be in Russia. We are having a great opportunity on the market, and we are trying to work on what we have built over the past two years — a focus on human resources. A professional management team is not only needed to open a restaurant, but also to promote and make it function effectively. So I would say we are looking forward to having a fabulous 2002, which will set us on the road to our internal public offering in the next two to three years.

Could you briefly highlight your Honored Guest policy in terms of membership, and of course, benefits to clients?

Our Honored Guest program, so far as I know, is the only program of its kind in Moscow. There are a lot of discount programs here, but the Honored Guest program is different from traditional ones in that it’s based on the philosophy of providing additional value to the customer, establish an emotional link between the restaurant and the program and forge a feedback mechanism between clients and the restaurants.
We serve more than 7,000 Honored Guests every month, and they are provided with up-to-date information on our unique, emotional dining experience. The program also provides additional benefits to clients in terms of using the services of our partners, from whom they can also accrue points on their discount cards. We intend to extend this program to include more partners in the future by signing simple cooperation agreements with them. Thereafter, we shall issue electronic cards to our Honored Guests, from which, on addition to the traditional 10 percent discount on all their purchases and services in the restaurants, they will also receive 1 or 2 percent off on credit card transactions with our partners.

What is the formula for success in the hotel/restaurant business?

There are specific things one has to understand in this business. But the main one is that success here does not depend on the amount of money lavished on the hotel or restaurant. Another important thing is that restaurant is a people business. There is always the tendency, especially among people with a lot of disposable income, to enter into the restaurant business because it’s a prestige, ego and status issue; it makes them feel proud. Most often, seven out of 10 such ventures go bankrupt, because they don’t realize the level of the business’ complexity, intricacy and delicacy.
The job sounds easy to outsiders but, in reality, it’s really very challenging. However, I’m really glad that restaurants and hotels are so difficult to operate successfully, because otherwise every Tom, Dick and Harry would be doing it.