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Slice of success



Published: Sun, June 23, 2013 @ 12:00 a.m.

Owner has weathered storms to bring pizza to the Valley

By Lee murray | TheNewsOutlet.org

111“My wife scheduled a wedding without telling me the dates. I said I was sorry, but I was going to have to go to Ohio first to open some Pizza Huts.”

Szambecki said that his young fiancee thought he was “full of it.”

Szambecki had been recruited by two entrepreneurs, Bill Halls and A. Scott Richie, to manage their new Pizza Hut franchise in Austintown. It was the first Pizza Hut in the Mahoning Valley.

Now, 45 years later, Szambecki is CEO of Hallrich Inc. and owns 84 Pizza Hut franchises across the region, which includes the franchise rights for the whole of the Valley.

So, does his wife still think he’s full of it?

“I gave up trying to convince her otherwise,” Szambecki said.

Szambecki relocated from the hot, flat plains of Kansas to a city right at the heart of the booming steel industry. Pizza is a big deal in Youngstown, where Italian roots run deep and the choice of local pizzerias is huge. So when Szambecki decided to ditch his management job at a Wichita, Kan., Pizza Hut franchisee training center to follow Bill Halls to the fertile ground of late 1960s Northeast Ohio, perhaps he was on to something.

“I moved from agriculture to Youngstown, and it was steel city at that time. There were 30-some steel mills operating in both Mahoning and Trumbull County.”

There was plenty of industry, which meant plenty of mouths to feed. But there was plenty of homegrown competition, too.

“In Ohio, when your folks die, you take the money and either buy a bar or go into the pizza business,” said Szambecki. “That’s the two uses for inherited money in Ohio.”

But the store did well in the first year, and Szambecki decided to stay. His fiancee soon followed him to Austintown.

“It was a great market. But just after I got here, they started closing the steel mills. Ten years later, there was just carcasses of rusty steel facilities.”

As the business started to grow, the decreasing population put a limit on just how far it could expand.

“What they were saying back in the 1960s was that you needed a 30,000 minimum population within a 5-mile radius of each Pizza Hut to make a profit,” Szambecki said. “As the population began to decrease here, it was tricky to make sure we didn’t expand too quickly.”

It was a combination of statistical data and local urban lore that kept Szambecki and Hallrich on track.

“The general contractor on the Mahoning Avenue Pizza Hut said, ‘If you last five years and the people accept you, you’ll be good here forever,’” Szambecki said. “The Youngstown market have had their troubles economically, but they’ve sure been good to us.”

Szambecki studied printmaking at Youngstown State University for a year while he was managing the Austintown location, but gave it up to dedicate his time to making pizza instead.

“The thing with being a fine-arts major is you either go into teaching or you starve to death,” Szambecki said. He left YSU and moved to Kent to open a second Pizza Hut while his partner Bill Halls ran the Austintown store. Shortly afterward, they opened a store in Alliance, and then Painesville.

They had a plan.

“We were staking out counties,” Szambecki said. “At that time, if you had a store in a county, you had the franchise rights to the whole county, which gave you more development potential down the road.”

That monopoly means that only Hallrich, Szambecki’s firm, can open a Pizza Hut here, and it has the final say on whether licensees are allowed to open small stores in malls and at truck stops in the area.

“Our franchise agreement is considered a legacy agreement,” he said. “They don’t do that anymore.”

Hallrich has weathered some big financial storms since the 1970s. The current economic slump has affected many pizza businesses all across the state, Szambecki said, but Hallrich has managed to stay strong.

“In 2010, more than half the Pizza Huts in Ohio were either in Chapter 7 or Chapter 11 bankruptcy,” he said. “None of mine were.”

Szambecki said that the biggest challenge he faced with the company was the unexpected death of his friend and colleague Bill Halls in 1984.

“[His] heart valve blew out,” Szambecki said. “So we suddenly went from three partners, Me, Bill, and a silent partner back in Wichita, to just me and the guy in Wichita,” meaning A. Scott Ritchie.

Szambecki said that suddenly Hallrich was indebted to Halls’ estate to the tune of $3 million.

“He was a great guy — a friend and a mentor. But there was debt to his family,” Szambecki said.

But Halls’ death spurred Szambecki on and motivated him to swim, not sink. “We had to find a way to grow our way out of that debt,” he said.

Hallrich went from having 24 stores taking in $10 million in sales and making about $1 million in profits, to having 50 locations taking in $35 million in sales making more than $3 million in profits in just eight years.

“We didn’t roll over and play dead,” said Szambecki.

Szambecki said that Hallrich thrives by nurturing local talent.

“I think some of our best homegrown management people have come out of the Youngstown market,” he said.

Szambecki said Hallrich is run like a family business, which helps him to recruit the best employees in his stores and professionals at the company’s corporate offices in Stow.

“We had a consultant come in, and he said that this is run like a family business. That’s kind of the way we have done it and the way we think about it,” he said.

“But we’ve got some real professionals. Our CFO is sharp as a tack, and I’ve always believed in hiring people who are smarter than me.”

TheNewsOutlet.org is a collaborative effort among the Youngstown State University journalism program, Kent State University, University of Akron and professional media outlets WYSU-FM Radio, The Vindicator, The Beacon Journal and Rubber City Radio, both of Akron.


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