REIs Can Learn From Dutch Bros. Policy Against Pessimism

Back on the West coast where I’m originally from, a small coffee company has started to make waves. That company is named Dutch Bros. Known for its signature drive-through coffee stands, the company has managed to create 264 locations in seven states. And one of the things that underlies their success is the culture they have built.

A Policy Against Pessimists

According to Forbes,

“Dutch Bros., based in Grants Pass, Ore., hires and promotes only outgoing optimists committed to customer service. No bad tempers allowed. ‘It’s our Dutch Bros. way of life,’ Von Tersch says, ‘practicing love and humility.’

“Sound like a cult? ‘‘Cult’ is just ‘culture’ minus three letters,’ says Josh Kimzey, 33, who’s worked for Dutch Bros. since 1999.”

And such a culture has paid off quite well:

“Cult or culture, it is working for the franchisor, which logged $283 million in systemwide sales last year. According to FRANdata, the consultancy in Arlington, Va. that puts together FORBES’ annual list of best and worst franchises, Dutch Bros. has one of the strongest track records among the 3,375 firms evaluated. In the two previous rankings Dutch Bros. was rated among the top ten companies that require franchisees to invest between $150,000 and $500,000. This year it just missed making the cut. The company scores high for franchisees’ return on investment and store profitability. It also scored a high 97% five-year continuity rate, meaning only 3% of units closed between 2010 and 2015.”

Lesson: This Lesson From My Mastermind Group Completely Changed My Real Estate Business

The Difference Mindset Brings to Companies

Indeed, there’s a recent book out called the The No A**hole Rule: Building a Civilized Workplace and Surviving in One That Isn’t. I don’t think I need to elaborate on the book’s contents.

But I can say from experience that the difference in a company’s culture that comes from having optimistic, supportive people versus negative, overly emotional types is almost unquantifiable.

Sometime back, we had a volatile property manager, and we later hired her daughter as a leasing agent. They ended up forming their own little clique and almost an “us versus them” attitude that all but set the office staff against each other.

Our property manager would throw her emotions around the office, yell about people all the time (rarely to their face, of course), and she almost caused two other employees of ours to quit with her chaotic negativity. The leasing agent, for her part, was rude, talked about people behind their backs, and was unwilling to ever accept responsibility for doing something wrong. It just so happened to always be someone else’s fault.

Needless to say, no one really liked showing up to work, and it showed in their performance.

Negative People WILL Drag You Down

Back when I worked in construction, I remember working on a crew with an extremely critical foreman. It’s not that he had high standards; it’s just that he derided just about anything and everything about just about everyone. The entire crew lived in what seemed like a light sense of constant paranoia. Not exactly what I would describe as a constructive team environment.

There are many such stories like this that I could describe and others have told me about. Negative people drive you down, and it’s simply not worth having them as part of your organization, be it as employees, vendors, or the like.

After we let go of the aforementioned property manager and leasing agent, we restaffed those positions with much more optimistic and positive people. All of a sudden, the office has come together as a team. People enjoy showing up to work. And people are, not surprisingly, much more productive.

The Amazing Benefits Positivity Can Bring

We hired a receptionist who didn’t really want that position, but needed a job. She even told us that she would probably move on in the next few months, which was OK with us since we needed someone for the time being. She turned out great, though, and despite not liking the position, she decided to stay because she loved the environment and people she worked with. Eventually, we were able to find her a position better suited to her talents. That’s the difference a positive environment can make.

The lesson is there is only so much you can do to affect your organization’s culture. By far the most important thing is who you have on board. Happy employees are productive employees, and nothing makes employees less happy than having to share an office with negative people.

And, of course, it goes further than this. It extends to your customers, tenants, vendors, clients, colleagues, and the like. Back to Dutch Bros.:

“Baristas, known as ‘bro-istas,’ memorize patron preferences, ask after spouses and kids, and dole out free drinks to customers who are going through rough times. Kevin Murphy, 29, a franchisee in Portland, gave flowers and a month’s worth of free iced coffees to a regular who had confided in him after her abusive husband hanged himself. ‘We were her safe place,’ he says.”

Set Yourself Apart

Going that extra mile for your customers can really set you apart. While this is obviously a much more trivial example than the story about Dutch Bros., we ask on our applications what a tenant’s favorite restaurant is. If we have a maintenance issue go long or we don’t handle it very well, we send them a note and a gift card to that restaurant. The personalized touch adds a lot more than a simple rent discount (and is likely cheaper, too).

It may sound trite, but positivity is crucial. And both positivity and negativity are contagious. If you have a very negative employee, the best thing to do is probably let that person go. And it’s something to look for in interviews, too. Furthermore, like Dutch Bros., you should try to extend that optimism through all facets of your business.

How do you create a good company culture in your business? How important do you find positivity to a productive workplace?

Let me know your thoughts with a comment.

Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.