Lessons in starting and growing a small business from Red Island Hospitality Group

There’s no perfect recipe for starting a small business, but there are some key ingredients for success.

Steve Barber and Jacob Hiemstra, co-owners of Red Island Hospitality Group Inc. in Charlottetown, founded Hunter’s Ale House in 2005. Since then they’ve steadily grown their business into four successful restaurants. In addition to Hunter’s, the group now owns and operates John Brown Richmond Street Grille, Factory Cookhouse and Dancehall, and the Charlottetown Beer Garden and Seafood Patio.

In any market this is a major accomplishment, but in a town with a population of about 35,000, it’s clear Barber and Hiemstra have created something very special.

For Barber, success is no accident. He says there’s a number of important things every small business owner must do—especially in the hospitality industry—to achieve his or her goals.

1. Know your industry

Barber holds an honours diploma in Hotel and Restaurant Management from Holland College on PEI, as well as a Bachelor of Commerce in Hotel and Resort Management from the University of Calgary.

The hospitality industry and I go hand in hand. I’ve been working in this field since I was 15 years old. The combination of education and experience has let me not only understand how the industry works, but also how I need to work within it.

2. Respect your staff

Employees are the backbone of any business—you have to treat them well. A lot of our employees have been with us since 2005 and I think the real reason customers keep coming back here is the consistent level of service.

3. Know your customers

If you’re from PEI, our staff knows your name. You have to take the time to get to know your customers and understand what products and services they’re looking for. In business school, they call it grassroots marketing. On PEI, we just call it being friendly.

4. Know your market/community

To truly know your customers, you have to know your community. Understanding the market, competition, and industry trends helps keep your hand on the pulse. You can’t simply operate in the community, you need to be a part of it.

5. Lead by example

My management theory is ‘do unto others as you would have them do unto you.’ I don’t ask someone to do something I wouldn’t do myself. From cooking, to serving, to shoveling snow, to cleaning the bathrooms, you have to be willing to do every job—including the dirty work.

6. Always have a reason for customers to visit

Just because you build it, doesn’t mean they will come. You always need to give customers a reason to walk through the door and that means offering the right services at the right times. Whether it’s a great variety of live music, offering breakfast specials, or turning the restaurant into a night club after hours, you have to be willing to adapt to changes in demand.

7. Restoring is easier than starting from scratch

Every one of our establishments was previously an existing business that was faltering and needed to be rejuvenated. You don’t always need to reinvent the wheel. It’s a big undertaking to start from the beginning. It’s much easier to find an existing business or property that’s not reaching its potential and then give it some new life.

8. Know your product

You have to know what you’re selling, why you’re selling it, and how you’re going to sell it. It might sound obvious, but a lot of people don’t take the time to truly understand their product lines and business goals.

9. Believe in yourself

If you don’t believe in your business, no one else will.

10. Be prepared and have the right partners

When Jacob and I walked into Provincial Credit Union we had done our homework and had a strong business plan to back up our financing proposal. Very early into our initial conversations I could tell this would be a real partnership and it’s now lasted more than a decade. At the end of the day, the credit union took a chance on us because we proved we were serious, knowledgeable, and prepared. 

Provincial Credit Union has been very supportive, offered strong advice every step of the way, and even handles our employees’ RRSPs and every day banking. Since day one they’ve had our backs and that gives you a lot of confidence, especially when it’s time to take your business to the next level.

Recently, the Canadian Federation of Independent Business named credit unions number one in serving the needs of small businesses. Atlantic Canadian credit unions continue to provide strong support for small businesses across Atlantic Canada, as well as those who are no longer very small, like the Red Island Hospitality Group Inc.