The world of business is definitely not without
its risks.
But it seems some people are more fascinated with the art of risk-taking.
Mike Ilitch was one of those people.
A man of perseverance and a business ethic that was so strong and versatile, he not only
transformed a single pizza store into a billion-dollar franchise, but went ahead to revive dying
sports teams, a theatre that had been given up on, and even an entire city.
This is the story of Mike Ilitch, founder of Little Caesars Pizza, owner of the Detroit
Tigers baseball team and the Detroit Red Wings Hockey team.
One of the greatest entrepreneurs of his generation.
Welcome to Planet Biz.
The Failed Career Sotir and Sultana Ilitch were immigrants from
Macedonia.
They lived in Detroit, which was where they gave birth to their son, Michael Ilitch on
the 20th of July, 1929.
Michael, more commonly known as Mike, attended school at Cooley High School Detroit, Michigan.
When he was done with high school, he served with the Marine Corps for a period of about
four years.
Mike was an athletic young man throughout his time in high school and beyond.
Upon returning home from his time of service as a Marine, Mike was offered $3,000 to play
baseball as part of the Detroit Tigers.
He accepted and had a career in the minor leagues for four years.
Between 1952 and 1955, Mike played mostly second base for the Detroit Tigers, the New
York Yankees, and the Washington Senators.
Unfortunately, Mike never made it into Major League Baseball.
All of his career as a professional baseball player was spent in the minor leagues.
When he made it to AAA, the highest level of play in the minor leagues, Mike’s career
was looking promising and he was close to the major leagues.
But unfortunately, he would never get there.
Any hopes that Mike may have had of ever playing in the major leagues would be taken away completely.
In 1955, he injured his knee and as a result, couldn’t play as well as he used to.
Mike was forced to leave the minor leagues, ending his career as a baseball athlete for
good.
Left without a career, Mike took the first of his biggest, most legendary risks.
Risking It All After getting kicked out of his job as a baseball
player, Mike decided to start a business.
He became convinced of the potential of his idea when he was able to persuade a Detroit
nightclub owner to start selling pizzas.
Mike Ilitch was given permission to make pizzas in the back room of the nightclub.
Business was fantastic and Mike realized that it could be a good idea to start his own pizzeria.
But there was a problem.
Mike was fresh out of a career and he and his wife Marian didn’t have much in the
way of savings.
So, Mike became a door-to-door salesman.
He went from house to house selling aluminum awnings in a bid to raise the capital he needed
to start a pizzeria.
Mike was so good at convincing his prospects to make a purchase that his associates referred
to him as “the Hammer” because of his ability to nail down deals.
By 1959, Mike and Marianhad saved up $10,000 dollars.
They took out a loan of $15,000 and set off to start their pizzeria.
The couple chose a location for their restaurant – a strip mall in Garden City, Detroit.
Then, they did the riskiest thing they could have done; they poured all their life savings
and the money they had borrowed into the restaurant which they named “Little Caesars Pizza Treat”.
The restaurant would eventually become known simply as “Little Caesars Pizza”.
The restaurant opened officially on May 8, 1959.
Mike handled the food production and marketing while Marian was in charge of the finances,
kinda like the couple that founded In-N-Out Burger.
If you want to see our video about In-N-Out Burger, check the link in the description.
In addition to pizzas, the restaurant originally served hotdogs, chicken, fish, and spaghetti.
On the first day of business, they sold 49 pizzas, keeping track of their sales in a
little spiral notebook.
Things weren’t always so smooth during the early years.
They ran into difficulties and had to struggle to pay the bills.
Once, Marian was at home when a stranger showed up and announced, “I'm here for the couch.”
She later found out that her husband had sold their furniture to help cover some of their
business bills and had forgotten to inform her.
Things were bad, but the couple persevered.
They not only poured in all their money into the business, they put in hours upon hours
of hard work and commitment.
Mike’s exceptional business sense and eye for details soon brought their business out
of the struggles it was experiencing.
And soon, the little pizzeria was on its way to the top.
The Breakthrough During its first years, Little Caesars wasn’t
having a smooth ride.
They weren’t the first business to realize how profitable the sales of pizza could be.
Mike knew this, and realized they needed a way to stand out.
Eventually, they found their answer – they came to the conclusion that their key to success
was to sell high quality pizza at low prices.
It worked like a charm and in just two years of operation, they opened a second restaurant.
Little Caesars created their niche in the competitive world of pizzerias by offering
only takeout services.
This helped them keep costs low as they didn’t have to hire too many staff or cover delivery
expenses.
Because of this, they could afford to sell pizzas for a low price.
By the end of the 1960’s Little Caesars had franchised over 50 restaurants in the
United States, including one franchise in Canada.
They continued to win customers over from their competitors by running catchy ads and
offering steep discounts.
In 1971, Little Caesars began a campaign that was previously unheard of, offering two pizzas
for the price of one.
Some other Pizza restaurants tried to duplicate the two-for-one deal in a bid to compete with
Little Caesars, but they couldn’t cover the costs.
The restaurant publicized their amazing offer using silly humor and the now popular tagline,
“Pizza!
Pizza!”
It was all a hit – the commercials, the two-for-one deals, and ultimately, the restaurant
itself.
This on its own would be an amazing achievement for any entrepreneur, but Mike Ilitch didn’t
settle for the immense success of his restaurant chain.
He somehow managed to go above and beyond this, applying his business savvy to projects,
most of which appeared destined to fail.
Mike’s Sport Ventures Still an athlete at heart, Mike invested time
and money into Detroit Sports teams.
Some of these investments didn’t end up great.
One in particular, the Detroit Wheels would fail miserably.
In 1974, not up to a year after it was started, the team folded up, suffering from poor planning
and management.
Mike wasn’t deterred by the failure of the Wheels, he went on to invest in another sports
team called the Detroit Caesars.
Mike did everything in his power to make sure the team was a success.
The Caesars were a team for just three years, but during that short time, they were a success.
They won two championships and got to the semi-finals of the third.
In 1979, the team was disbanded.
Ilitch wasn’t done making investments into sports.
In 1982, another opportunity presented itself for Mike to once again own a sports team.
It was the Detroit Red Wings, a hockey team.
Mike bought the Red Wings for $8 million.
He stocked the team full of promising rookies and seasoned hockey stars, sparing no expense
to transform the Red Wings into a dream team.
The Red Wings won several championships and today, they are one of the most valuable franchises
of the National Hockey League with a revenue of almost $200 million and a value of about
$800 million.
Another team he invested his time and money in, is the baseball team - the Detroit Tigers.
He spent $82 million dollars to buy the very team he had once played for.
Now, the Tigers are worth over $1 billion.
In an even more daring move, Mike moved his business headquarters to Detroit at a time
that other investors had turned their backs on the city.
These risky moves that Ilitch had made turned out great for him and even better for the
city of Detroit as investors were drawn in, transforming the city into much of what it
is today.
Setting Records Mike’s restaurant chain Little Caesars was
the first to use a new kind of speed-cooking conveyor oven known as the “Rotary Air Impingement
Oven".
This restaurant was also known for filling what is recognized as the largest pizza order
ever.
This record was set in 1998 when Little Caesars made 13,386 pizzas for the VF Corporation
of Greensboro, North Carolina.
Today, Little Caesars Pizza is the third largest pizza chain in the United States.
It has over 5,400 locations on four continents around the world and rakes in billions of
dollars in sales each year.
An ardent risk taker, visionary, and philanthropist, Mike Ilitch was a man that wasn’t afraid
of going for what he wanted.
Even though he experienced his fair share of hard times and failed ventures, at the
time of his death in 2017, Mike was a billionaire worth over 6 billion dollars.
During an interview years ago, Mike said, “I came from zero.
It’s hard to believe sometimes.
It’s hard to believe this is yours.”
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