Olga's Kitchen looks to future, stays true to heritage
- Olga Loizon of Birmingham opened Olga's Kitchen in 1970, selling souvlaki sandwiches
- In 1971, Loizon was bought out by a group of investors and would later become Olga's Kitchen Inc
- At it's peak, the chain had 56 restaurants in 11 states. It now has 33 restaurants, most in Michigan
- The chain plans to begin franchising in new markets in the next 5 years.
In 1970, against her husband's wishes, Olga Loizon opened a tiny shop at the Continental Market in Birmingham with her son Bill, selling souvlaki to customers eager for the previously unheard of Greek sandwich.
"My space was 11-by-10," said Loizon of Birmingham. "When my son would be cutting the meat, I'd be sitting there rolling the dough and we'd be bumping fannies."
Nearly 45 years later, Olga's Kitchen Inc. is a thriving chain of restaurants selling sandwiches that are still based on Loizon's original concept and her fresh baked gyro bread. After years of consolidation since the mid-'90s, the privately-held Troy-based company is poised to expand with its first new franchises expected in Chicago, Philadelphia and other parts of the Midwest within the next five years. Loizon no longer has a financial stake in the company, but she remains the face of Olga's Kitchen.
At its height in the 1980s, there were 56 restaurants in 11 states, as far away as Texas, Oklahoma, California and Maryland. But by 1997, the company's sluggish sales forced the closure of many out-of-state stores and the remodel of many locations at home.
The restaurant chain is getting back into the franchise world at the perfect time, said David Steinberg, counsel at Jaffe Raitt Heuer & Weiss P.C. in Southfield.
"The market right now for franchising is really good," said Steinberg, who works with companies to handle the legal aspects of their franchising plans. "It's been things all the way from plumbing to haircuts. It's been encouraging to get the phone calls from people who are interested in expanding."
Although he's never worked with Olga's Kitchen, he says the company has a winning formula and proven success.
With more than 1,000 employees working at 33 restaurants, including 30 in Michigan, one in Ohio and two in Illinois, it's all a bit overwhelming for the woman who remembers the struggles of the early days.
"It was very hard," said Loizon. "I can smile about it now, but there were a lot of tears at the time."
'I'm going to be a success'
It started with one souvlaki machine that Loizon brought back after taking her three children to Greece. Then she added the broiled beef and lamb meat, a blend of three cheeses and garlic and cayenne pepper powder all wrapped up in that flat bread and smothered in her signature tangy greek yogurt. It didn't take long before people began lining up for a taste.
"I got the idea from Greece," said Loizon. "I figured if my American-born children were going crazy over this sandwich and we didn't have anything like this here, there was a real opportunity."
Not everyone bought into the idea at first, including her husband, John, a successful Birmingham architect. The two would argue late into the night to the point where Loizon was too anxious to sleep.
When she went to the owner of the Continental Market, wanting space to lease, his secretary scoffed at her description of what would become the signature sandwich.
"She said, 'That sounds horrible! Nobody's is going to buy that kind of a sandwich here,' " a still-miffed Loizon recalls. "I turned and looked at her and said, 'I don't know who you are, and right now I don't care who you are. I'm going to be a success.'"
In 1971, a year after she started the shop, she was bought out by a group of investors who had tasted her food at a catered party and loved the concept. By 1976, Olga's Kitchen Inc. was established and has continued bringing Loizon's recipes and name across Metro Detroit.
At 88, Loizon remains a sort of figurehead for the company and is still asked for her input on menu items, even though she ultimately doesn't have any control over it. She frequently visits the restaurants to talk to customers. She still loves the food, always choosing to order her sandwich "Olga's way," the same way she always served them back in the day.
"I wouldn't give up because I knew Birmingham was ready for this," said Loizon. "Ready for something new and something different."
The restaurant chain is a privately held company, so it isn't required to disclose sales figures. Loredana Gianino, marketing manager for Olga's Kitchen, said it is against company policy to release that information.
Olga's, like many chain restaurants, has been experiencing tougher times as the economy continues to recover and people are more careful about spending on luxuries like eating out.
"The whole restaurant industry is feeling the pain," said Gianino. "But part of what makes us a success is that we have three generations of Olga's lovers."
The menu has gone through major changes. For the first few decades, Olga's stuck to gyro-style sandwiches, Greek salads, soft drinks and sides, like its snackers (fried and seasoned pita bread), spinach pie and french fries. Over the last few years, though, the chain has diversified its menu in all directions, offering more sophisticated sandwiches and salads, and additional appetizers like bruschetta, sweet potato fries and hummus.
The franchises will most likely be in the fast casual model of the Royal Oak Olga's on Woodward south of 13 Mile. This allows patrons to get in and out quicker, but still provides a seating space for those who want to linger and enjoy their meals in a restaurant setting.
Steinberg says Olga's is one of many restaurants switching to that model.
"In the last 20 years, there's been a movement toward quicker service, especially for lunch service," he said. "Some of the restaurants where you have to sit there for a long time to be served, people are not going to them as often or only going for dinner."
To build brand loyalty, Olga's is putting promotions in place, the most recent a rewards system that allows patrons to collect points whenever they eat at Olga's.
Recently on the restaurant website and Facebook page, fans of the food could enter to win a Mediterranean cruise, which will visit many of the places Loizon frequented on her trips back to her family's homeland; the same places that inspired her food.
It always comes back to that in the end, said Gianino.
"We have to stay true to our heritage," she said. "True to what made Olga's a success in the beginning."