Thompson Hospitality CEO Leads Through Diversification

For aspiring entrepreneurs, Thompson offers sage advice: 'Get knowledge and experience in the business before you launch out on your own.'

Restaurant sales are projected to surpass $1.1 trillion this year, setting a new record for the industry. By the end of 2024, it is anticipated that over 15.7 million individuals will be employed in this sector in the United States, according to the National Restaurant Association’s 2024 “State of the Restaurant Industry” report.

Black-owned businesses play a crucial role in the American economy, significantly driving growth and development across numerous industries. About 9% of restaurant firms are owned by Black people, below the total U.S. representation of 13.6% reported by the U.S. Census Bureau.

Despite the challenges many face in the restaurant industry, Warren Thompson, CEO of Thompson Hospitality, founded in 1992, leads the nation’s largest minority-owned food and facilities management company. Thompson’s success story exemplifies the potential for growth and excellence within Black-owned businesses, showcasing their ability to thrive and innovate even in competitive markets.

BLACK ENTERPRISE sat down with Thompson to gather his insights on the changing landscape of the restaurant business, diversification, and his philosophy about leadership.

Delivering Success Through Diversification

Thompson attributes much of his success to a profoundly ingrained entrepreneurial spirit. “I was a consummate entrepreneur as a kid,” he recalls. “I had multiple businesses, from raising hogs to cutting grass to selling produce from an old school bus.” This entrepreneurial mindset has been a cornerstone of Thompson Hospitality’s culture. From its inception as a restaurant company, the business quickly diversified into contract food service and hotels, allowing it to navigate economic fluctuations and crises like the COVID-19 pandemic.

“We’ve done that with an entrepreneurial culture,” Thompson explains. “People we attract and retain are entrepreneurial. In every interview, I ask if they see themselves as more of a corporate person or an entrepreneur. I want the answer to be entrepreneurial.”

Leadership, for Thompson, is about taking calculated risks and evolving with experience.

“When I started this company 32 years ago, I took crazy risks,” he admits. “I started with $100,000, heavily leveraged transactions. I’ve become more conservative as we’ve grown, but I still believe in taking appropriate risks to grow the company.” His leadership philosophy is encapsulated in the company’s guiding principles, the last of which is “Do the right thing, treat others the way you’d like to be treated.” This principle, he says, is the essence of the company’s culture and drives decisions at all levels.

Power in Partnerships

The journey hasn’t been without its challenges, particularly in the context of racial issues. Starting Thompson Hospitality in 1992, Thompson recalls, “was a time when our country was going through racial challenges similar to what we are experiencing now.” His first major deal, franchising 27 Shoney’s restaurants, came on the heels of a significant discrimination lawsuit against Shoney’s.

“Even though they were required to have a certain number of African American franchisees, they were having a hard time. When I approached them, they were anxious to do the deal.” To navigate the racial tensions and business hurdles, Thompson assembled an influential advisory board, including prominent figures like Martin Luther King III and Dr. Dorothy Height, who provided crucial support and guidance.

Thompson’s commitment to diversity and community is unwavering. “Diversity equals income,” he asserts. “It’s been a fundamental part of our company from day one.” This commitment extends to substantial contributions to Historically Black Colleges and Universities (HBCUs).

“We provide about $4 million a year in scholarships and financial support to HBCUs,” Thompson says, highlighting his deep personal connection to these institutions as both his parents were HBCU graduates. This focus on giving back and fostering diversity has strengthened the company and created opportunities for future generations.

Hen Quarter Prime: A Recipe for Success

Hen Quarter Prime, the latest addition to the Thompson Hospitality portfolio, has quickly become a standout in the competitive Washington, D.C. restaurant scene. According to Alex Brown, director of operations, its success lies in a robust marketing strategy and deep community engagement.

“If you’re joining us for dinner, we’ll talk to you about brunch, and vice versa,” Brown says. “We also cross-market with brands like Makers Union and Milk and Honey at the Wharf.” This integrated approach helps maximize visibility and draw a diverse crowd to Hen Quarter Prime, enhancing its reputation as a destination for various dining experiences.

Adaptation and innovation are also crucial to Hen Quarter Prime’s success. Brown notes that the restaurant continually evolves its menu to cater to customer preferences and market conditions. “We offer everything from a casual dinner with chicken and waffles to a more elevated experience with table-side carved Tomahawk and Porterhouse steaks,” he says. The beverage program is equally versatile, featuring entry-level cocktails and a large selection of rare bourbons and whiskies.

Hen Quarter Prime’s blend of innovative marketing, strategic cross-promotions, adaptive offerings, and community engagement is a model for success in the competitive restaurant industry. It thrives under the Thompson Hospitality Group’s umbrella, bringing a unique and elevated dining experience to the heart of Washington, D.C.

Entrepreneurial Advice

For aspiring entrepreneurs, Thompson offers sage advice. “Get knowledge and experience in the business before you launch out on your own,” he recommends, drawing from his nine years at Marriott.

He also emphasizes the importance of strategic partnerships.

“Five years into this company, we partnered with Compass Group, the global food service company. This partnership allowed us to grow our business exponentially.” Thompson encourages young entrepreneurs to be financially conservative and seek proper funding, noting that many businesses fail due to being underfunded.