Round Table owner plots LV expansion

Phil Levine

Thursday, Dec. 9, 1999 | 11:15 a.m.

Few investment managers can be deemed experts in both stocks and sauces. Then again, very few financial professionals share the diverse background of John Klacking.

A senior vice president at Wall Street giant Salomon Smith Barney, Klacking also owns the 10 Southern Nevada franchises of Round Table Pizza. As both an investment manager and entrepreneur, he divides his time between Smith Barney's Reno office and his business interests in Las Vegas.

In addition to his fiscal and food-related duties, Klacking is also founder and chief executive officer of Las Vegas-based NEL Laboratories. The company specializes in environmental analysis, and it's that personal interest in organic compounds Klacking credits for his affection for quality pizza.

"I have a Ph.D. in biochemistry, and I believe that people with that type of background tend to have a strong interest in food," he said. "On top of that, I also love pizza. So when the opportunity arose to buy a Las Vegas (pizza) store from a friend looking to sell out, I grabbed it."

Soon after that purchase, Klacking attained the Southern Nevada development rights from Walnut Creek, Calif.-based Round Table Pizza Inc. Through his management company, Concord Sierra Restaurants, Klacking opened his first Round Table outlet in February 1997. The first store was at Warm Springs Road and Eastern Avenue.

He's since added nine Las Vegas locations and -- barring an economic slowdown or decline in Las Vegans' hunger for pizza -- expects to double his local store holdings to 20 within the next two years.

Given recent trends in American eating habits, there's little reason to doubt that expansion will take place.

Generating more than $30 billion a year, pizza is rapidly replacing apple as America's favorite pie; industry experts estimate the nation's 60,000 pizzerias sell nearly 3 billion pies per year.

Klacking says that all-American image is in keeping with his franchise's target market: mom, dad and the kids. He said the growing number of families in Metropolitan Las Vegas makes expanding his franchise an even more appealing prospect.

"We're really a family oriented business," he said. "We offer special rooms in every restaurant where families or groups can hold get-togethers and chat over a pizza. There's no charge for reserving the rooms, and we work hard to make sure customers feel comfortable dining in.

"Unlike other chains, our emphasis is on quality fresh products rather than just fast service. All our ingredients are shipped in fresh daily, and our dough is specially made for Round Table."

Like many other entrepreneurs, Klacking says record low unemployment poses one of the largest challenges to his service-oriented business.

"In this business, (quality) employees are critical," he said. "Turnover in this industry is high, and we can't directly compete with the large casinos in terms of compensation. So we struggle to find and keep good people, and have instituted several different initiatives to accomplish that goal."

Klacking says store managers are offered an incentive plan, and all employees are part of the "Gotcha" progam rewarding service above and beyond the call.

"There are cash payments, raffle tickets, and a range of other ways we try and encourage employees," he said. "We also try and create a fun environment for people to work in."

Finding quality store locations is almost as difficult as hiring good employees, said Klacking.

"In Las Vegas, you have to sign a lease at least two years before a new shopping center is built," he said. "Most good locations are already fully leased, so it's a real challenge to get into a good site."

Klacking said his financial background -- he currently manages about $300 million in investment funds from his Reno office -- has taught him the essentials of successfully managing a business.

"We're (Salomon Smith Barney) part of CitiGroup, one of the most successful companies in America," he said. "I've worked with (CitiGroup co-CEO) Sandy Weill, and I've learned a great deal about how to watch costs and run a profitable company."

As Concord Sierra's CEO, Klacking said he relies on the company's Chief Operating Officer Duncan Stoops to run the day-to-day operations in Las Vegas. He divides his time between his various Las Vegas operations and his home in Reno.

Ultimately, Klacking hopes to one day take his company public. For now, however, he's content to carve out a growing share of the Las Vegas pizza market.

"All the signs point to a continued strong economy, but even if there's a downturn, pizza is recession-proof," he said. "I mean, where else (but a pizzeria) can you feed a family fresh baked food for $10?"