Dubai: Although Walid Hajj is now considered a veteran restaurateur, this UAE-based Saudi national got his first major break in food entrepreneurship about two decades ago.
“I believe I found that break with the people running the Cinnabon brand about 20 years ago,” recalled Hajj, who moved to Dubai in 2007. “While I was part of a family company that works in food, I never operated a restaurant or the franchise.”
Apart from Cinnabon, Hajj’s expertise in operating food services and related businesses stems from starting several other popular restaurant franchises in the region, including Zaatar W Zeit, Carvel, Seattle’s Best Coffee, and Five Guys.
I believe I found my first major break with the people running the Cinnabon brand about 20 years ago
– Walid Hajj
100 restaurant chains, employing over 3,000
Hajj proved his entrepreneurial acumen when he started ‘Cravia’ in 2001, because since then the Dubai-based franchise operator added to its portfolio over 100 restaurant chains in the UAE, Saudi Arabia, Bahrain, and Qatar, employing over 3,000 employees.
However, Hajj sold a majority stake in Cravia to a private equity firm in 2016, giving up executive positions at the helm in the process, while retaining the role of founder. He later went on to co-launch Saudi Arabia-based cloud kitchen operator Kitch and Dubai-based restaurant group Lavoya in 2020.
What are cloud kitchens?
Also often referred to as ghost kitchens or dark kitchens, cloud kitchens are essentially delivery-only restaurants. They offer restaurants, cafés, and other food retailers a space to prepare food with no dining facilities.
“When I sold my business 6 years ago, I considered an early retirement from day-to-day operation. I tried that for a little over a year and I hated it. Being involved in building a restaurant business is in my blood now, and I get a huge kick from it,” revealed Hajj.
Hajj is now gearing up to expand his restaurant franchises including global juice bar brand ‘Joe & the Juice’, US fast-food chain ‘Dave’s Hot Chicken’, and the 45-year-old Lebanese street food restaurant group, Barbar. However, for a short while before he ventured into entrepreneurship, he did a short stint managing brands at a conglomerate.
Managing a pre-entrepreneurship shampoo brand
“I worked with Procter & Gamble for a few years after college and was handling the Head & Shoulders shampoo brand in Saudi Arabia. I worked on a project that involved changing the cap of the shampoo bottle saving something like 50 cents on each piece. The total savings over a few years amounted to millions of dollars because of the volume – and that was significant at the time,” said Hajj.
“The two lessons I learned from these experiences were: Firstly, any small savings matter, secondly, scale is essential to success in business. I believe the latter has become a pillar in my mind when I think of any business. The potential scalability of a business idea became the determining factor in taking any new opportunity forward for me.”
Aside from being a brand manager at Procter & Gamble for two years, he also held the role of Vice President of Operations for his family business, United Group, in Saudi Arabia. Walid, who is married with three children, holds an MBA degree from Harvard Business School in the US and a bachelor’s degree in Industrial Management from King Fahd University of Petroleum and Minerals in Saudi Arabia.
The potential scalability of a business idea became the determining factor in taking any new opportunity forward for me
– Walid Hajj
Growing years before taking on entrepreneurial roles
“My childhood was simple. The one memory that sticks with me all the time is accompanying my father to his newly established business 40 years ago. Seeing how he built something from very humble beginnings to making it a substantial business I believe is what drives me professionally,” shared Hajj.
“Just being around my father with his amazing energy and passion inspired me and continues to inspire me to this day. Even at the age of 94, his eyes light up when you talk to him about a potential business idea or venture.”
Hajj added that memories of him sending telexes and then later faxes and even making tea and coffee for the guests are still stuck in his head. “I used to do that on weekends and on holidays and look forward to it all the time,” he added.
How do you usually fund your businesses’ initial investments?
“My initial businesses were all funded by myself and my brothers (also my partners). I never really had to ‘raise funds’ in the typical fashion. It was more a family-funding effort that was simpler to handle but also comes with a whole different set of complications and sensitivities,” said Hajj.
“In my recent business, Lavoya, I partnered with a friend, Fahad Al Hokair, who was eager to get into this sector. Fahad brought in his experience in retail and real estate, and together we complement each other for the benefit of the business.”
Two challenges Hajj faced when starting an F&B business
• Challenge #1: Finding his first big break
Although Hajj made a move into the industry for the first time nearly two decades ago, he still felt that one of the many challenges that stand out in his head is finding the first “break”.
“It is much easier to acquire F&B brands for example, or find locations, or hire… if you have a proven track record. If you have done it before and done it successfully, you are more likely to have people open doors for you. However, opening that first door, so-to-speak is the hardest part,” he explained.
“You need people to see your potential and believe in you, and that takes a lot of courage,” said Hajj as he described how he got his first big break with Cinnabon. “The person running Cinnabon international at the time, Mike Shattuck, believed in me and what I can achieve and granted me the rights for the UAE operation. It was truly a turning point in my career.”
It is much easier to acquire F&B brands for example, or find locations, or hire… if you have a proven track record
– Walid Hajj
• Challenge #2: Being often faced with failure
The other challenge or fear that Hajj said he continues to experience many years into working in this sector, is the “fear of failure”.
“You work so hard to acquire a brand, hire the team, and build the store and then the moment of truth comes when you open your doors to the public and wonder, ‘Will they come in?’ It truly is frightening because 8 out of 10 restaurants fail (actual statistic) and to think that after all this effort you may fail can discourage one from embarking on any venture, to begin with,” he added.
“On the other hand, once you taste success, you start wanting to take more risks and you learn to overcome the fear, and almost enjoy going through the process. I go through this journey now with the same level of excitement that I did when we opened our first store 20-plus years ago. Fearing failure is the biggest obstacle to success and overcoming that fear, I strongly believe, is what differentiates entrepreneurs from dreamers.”
Key costs when starting a restaurant concept in the UAE
The serial restaurateur went on to explain how that most often the economics of a restaurant vary a great deal.
“In general, your biggest cost elements are occupancy cost (rent) and labor. Together these account for about half your expenses. More recently, another cost element that was added to the equation is the cost of delivery. That skewed the financial model of operating a restaurant and made it necessary to adjust other cost elements to make up for this additional expense,” he explained.
Two tips to help budding entrepreneurs start a business
• Tip #1: “Don’t start a business because you have to start a business.”
Although there are many looking to start businesses and be their own bosses, it’s often considered a mistake to dive in without the necessary planning, and Hajj agrees.
“I think that on its own, the road leads to failure. Nowadays, college graduates often want to start their own business – almost for the sake of starting their own business – and with no idea at hand. The sequence should be reversed,” he said. “Once you have an idea or stumble upon one – you then consider the route of entrepreneurship to take it forward.
“For that, I am a big fan of young individuals resisting peer pressure of becoming your own boss. Stay curious and fully alert in this process and an opportunity will certainly make its way to you. This may be an old-fashioned way of looking at this, especially given the expedited route to fame that we are seeing these days through social media and others, but I think it is more sustainable and real.”
Fearing failure is the biggest obstacle to success and overcoming that fear, I strongly believe, is what differentiates entrepreneurs from dreamers
– Walid Hajj
• Tip #2: “Pick a field, scope or sector that makes you tick.”
When you are an entrepreneur, staying motivated is crucial, Hajj added, because as commitment wanes, so does your business.
“Pick something or a sector that makes you tick! Waking up every morning thinking that you love what you do is the best feeling in the world and is something that will make whatever you do sustainable, successful, and long-term,” he advised.
“Finding what you like is only going to come by exposing yourself to different things, and different environments. It is like finding love – if you sit at home dreaming about it, it will never materialise.”