Tom Monaghan has had at least a hundred "excuses" for failing in business--from
growing up in orphanages and detention homes, to starting a business with no business
sense, expanding too soon, going broke, losing everything, building it back up,
and almost losing it again.
But what's incredible about Tom Monaghan is that he's never used any excuse. The
way he sees it is that you haven't failed until you've flat out given up. By focusing
on his goal, day after day, he slowly reached that pinnacle of success
despite
a difficult childhood, the skimpiest of financial resources, and little more than
a high school education.
Tom's business story began when he was a college student. In 1960, Tom and his brother
Jim borrowed $900 and opened a pizza parlor near the campus of Eastern Michigan
University in Ypsilanti, Michigan. As long as classes were in session, the pizza
parlor did fine. When school ended, business dropped 75 percent. Through the summer,
Tom practically lived at the shop, performing every task himself--making the sauce
and fresh dough daily, preparing the vegetable and meat toppings, and dicing cheese
for what seemed like hours on end.
Jim, on the other hand, had a secure job at the post office--and less time to devote
to the business. When things looked the worst, the partnership began to crumble,
and Jim sold his half of the business to Tom in exchange for a 1959 Volkswagen Beetle
the brothers had used as a delivery car. "It was a setback," Tom admitted, "but
I remained optimistic. I knew that the success of my business was solely mine. And
I welcomed it."
Tom would have liked to stay in school, but now, as sole owner, that wasn't an option.
With dreams of expansion, he found a man who had run his own pizzeria and had been
the first to ever offer free home delivery. Eagerly, Tom offered him a job, but
the man would take nothing less than an equal partnership, with a buy-in of $500.
Reluctantly, Tom accepted.
Tom and his new partner opened two stores that fall, and by January added a full-service
restaurant. The only problem was that Tom still hadn't seen his partner's $500,
and everything was still in Tom's name because of his new partner's past bankruptcy.
While Tom worked 100 hours a week, drove a rusted-out Rambler, and occasionally
cashed his $125 weekly paycheck, his partner went on a spending spree, purchasing
cars, property, and making lavish improvements to his house. Despite warnings from
Tom's friends that the partner was taking advantage of him, Tom felt his partner's
past experience was an asset that he needed. Tom continued to focus on expanding
the business. "I believed I wouldn't get hurt if I played it fairly," he said.
A couple of years later, when his partner landed in the hospital and asked to dissolve
the partnership, Tom still decided trust was the best business decision. The partnership
was so entangled, Tom's lawyer recommended that Tom declare bankruptcy and start
over again. Tom adamantly opposed bankruptcy and instead paid his partner $20,000
for his share of the business. Tom knew full well that if his partner ever got into
debt again, it would be in his Tom's name. Tom wished him well, hoping he'd stay
healthy and be able to pay his debt, and went back to work making pizza.
Tom's goal was to be the number one pizzeria and build a reputation for making the
best pizza in Ypsilanti. To do so, he instituted strict guidelines regarding the
ingredients used in his pizza-- all had to be top grade and most importantly, the
dough had to be made fresh daily.
His business grew, and slowly Tom paid off some of the bad debt incurred during
his former partnership. He worked eighteen-hour days--from 10:00 A.M. until 4:00
A.M. the following morning--seven days a week. After years of dedication, his labor
of love allowed him to become current with his bills and actually take a vacation,
although it was a working vacation. He and his wife of three years visited every
pizzeria they could. Tom's objective was to learn from others how to implement processes
that would enable him to handle more business. For Tom, it was an exciting time,
and things were really beginning to come together. Tom was eager to grow beyond
Ypsilanti and the surrounding area and envisioned expanding Domino's to college
towns throughout Michigan.
Two years after his partnership was dissolved, Tom's worst fear became a reality.
His ex-partner declared bankruptcy. On Thanksgiving, Tom gave his wife the sobering
news. Tom was now responsible for over $75,000 in bad debt. "I had worked so hard
to build this business, to make it grow," Tom said, "I couldn't imagine losing it
all." He set up a payment plan with the creditors and promised to pay every penny
owed. Now more determined than ever to succeed, Tom went back to making pizza.