By Nia Scott
On Tuesday, April 4, the first speaker of the President Distinguished Entrepreneur series was Dan DiZio, CEO and founder of the Philly Pretzel Factory and an ESU alumni.
DiZio graduated from ESU in 1995 and opened up his first Philly Pretzel Factory along with his roommate Len Lehman in 1998. He has had incredible success with his business and today there are over 200 locations in 19 states.
President Marcia Welsh quickly introduced Dan DiZio to the packed audience in Beers Lecture Hall and he immediately jumped into his presentation.
He started at the beginning with how he became involved in the pretzel business. DiZio grew up in Bensalem, PA with a neighbor that sold pretzels in Philadelphia. One day, his neighbor got stuck with a thousand pretzels and he asked DiZio to help out.
DiZio made $100 that day and for an 11-year-old that was a lot, as Dizio said, “At the time my allowance was $3 a week, so this was nine months’ worth of allowance in one day, I hit the goldrush.”
From that moment on, DiZio and other kids in his neighborhood worked during their free time selling pretzels. He did this all throughout high school and even stopped going to school at one point so he could work more.
When he finished college, DiZio got a job as a stock broker but he wasn’t happy, so he started thinking about what he could be doing that would make him happy. This is when he decided to get into the pretzel business.
DiZio called up his roommate, Lehman, and together they made plans to open a pretzel store.
They realized that they needed to get a pretzel making machine to make the pretzels, however, at the time there were only a certain number of these machines available and they were all being used by different pretzel makers in Philly.
No one wanted to share their information on how to build one of these machines, because they didn’t want competition.
Eventually DiZio and Lehman found one in Florida and the guy was offering to sell it for $20,000. So, DiZio and Lehman rented a U-Haul truck, took their life savings, and went down to Florida. The machine looked old and worn down and they weren’t able to check if it even worked.
Yet, they were determined and decided to go for it anyway. DiZio and Lehman were there for hours trying to get the price down.
“We go back and we start negotiating. We got to this guy’s house at 11 a.m., we had dinner at his house at 8 p.m., we’re still negotiating at midnight. Finally, at 1 a.m., I think the guy had enough and we settled on $11,000,” said DiZio.
They brought the machine back to Pennsylvania and started working on getting their first store open. DiZio and Lehman were at first going to rent a warehouse like all the other pretzel makers, but then decided to be different and stand out from the others.
“We finally made a decision to put it on a retail street, on a street that people could come in and get these pretzels, not just when it closed at 9 in the morning,” said DiZio.
Their first store was a success, many people came each day to buy pretzels, but DiZio and Lehman were not prepared for the work that came with the success.
“We would start twisting pretzels at midnight, we would twist until about 4 a.m. and then we would deliver them to the airport.” They made a lot of money just from having the airport.
After their trip to the airport, “We would then twist and back all day long until 5 p.m.. We closed the doors at 5 p.m. and we’d drive to Sam’s Club and get materials.”
At the time, neither of them knew that they could have those materials delivered to them instead of buying them every day.
After going to Sam’s Club, they would return back to the shop and count up the money and then go home.
“At 7 p.m. we would go home for one hour – to eat dinner and shower, we would come back and sleep on the flour bags from 9p.m. to midnight every night.”
DiZio and Lehman did this seven days a week. It was too much for them to handle by themselves, so they made the decision to call up their college fraternity brothers and asked them to come help.
With the extra help, they opened a second store, but it went out of business. It was hard for them to overcome the failure of the second store, and Lehman ultimately made the choice to go back to Mayfair (the original store) while DiZio opened up more stores.
DiZio began opening other stores with other people, some of them ESU alumni, to expand the business. “I put up all the money, I would train them and we would become 50/50 partners in these stores.”
With this method, Dizio opened up a store every year until 2005 when he began franchising.
The franchising was a success and catapulted the business. With all the success, copycats started opening their own stores. DiZio and Lehman had fortunately been able to put all of the money that came from franchising the stores into the infrastructure.
The other pretzel stores went out of business or were bought by Philly Pretzel Factory because they had not built up as solid as an infrastructure and foundation as Philly Pretzel Factory.
There was more success as time went on and the business continued to grow in popularity. This was partly due to DiZio being on “Undercover Boss” in 2012. Now DiZio hopes to continue expanding the company into all 50 states, but has no plans at the moment to go abroad.
Before he opened up the floor for a Q and A session, DiZio spoke about the man who originally go him into the pretzel business when he was age 11. That guy that DiZio looked up to was now a drug addict who had nothing. He told the story as a cautionary tale for anyone who becomes successful.
After the Q and A at the end, President Welsh wrapped up the night and announced that DiZio had brought pretzels for everyone.
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