An International Entrepreneurial Spirit in Ann Arbor
The man behind four Chinese restaurants in Michigan
—By Yanzi Chen
The first time I saw Mr. Fuhua Zhong was when he was showing his dishes in a photo. As a result, I always have had an image of him standing in the kitchen, working hard behind the scene. Recently, I have surprisingly discovered that he is not just a chef but also an entrepreneur, owning eight restaurants, with four of them located in Michigan.
How It Started: Opportunity is for people who are prepared
Mr. Zhong started to accumulate cooking skills at a young age. His father was a well-known chef in China. Under his influence, Mr. Zhong started his journey in the food industry. After he started working, his father gave him a book of recipes that inspired him deeply. He started his journey of making and innovating new dishes after reading them. Since then, food has been a form of art that expresses a culture for him, and his goal was to share his hometown (Sichuan, China) cuisine abroad.
The early spring of 1979 signaled a new beginning for Mr. Zhong — China and the United States established a diplomatic relationship. Three years later, in 1982, Midland State (the U.S) and the Sichuan Province (China) signed a friendly deal. The next September, he received an invitation letter from the Midland city government to visit the United States as the deputy of a famous hotel. In the late autumn of 1991, Mr. Zhong flew to the United States as an envoy of culinary and cultural exchanges between China and the U.S.
He said, “If I haven’t spent time and effort into what I was doing, the city won’t recognize me as the ideal candidate…. Everything counts, everything I did when I was young took me to the U.S. and changed my life.”
A series of good luck happened after his arrival in the U.S. He initiated a company, gave many speeches around the country, cooked at the Olympic Games in London, and opened eight restaurants in different cities across the U.S. But all these are based on his previous effort and determination in cooking.
Coming to Ann Arbor: Be Innovative and Adventurous
He decided to come to Ann Arbor because he saw a great market potential here: the Chinese population was increasing at a substantial rate and there were no large-scale Chinese restaurants at that time.
According to statistics, in a decade (from 2000 to 2010), the Asian population in Michigan increased by 20%. It was also predicted in 2010 that at least 2,861 more Asians would move to Ann Arbor next year (2011). In 2011, 14.3% of the local population was made up of Asians, making them the largest minority group in Ann Arbor (The Ann Arbor News). These numbers signify a new demand in the eatery industry.
Looking at these data, Mr. Zhong saw a business opportunity. Most of the existing Chinese eateries were family businesses with two to three tables. As the market demand goes up, he boldly assumed that people would need a large-scale restaurant to cope with formal events. There was also no specialized cuisine that comes from the Sichuan province (well-known for its spiciness).
Said Mr. Zhong, “We don’t do what people have done. I wanted to be the one who can change the situation.” He opened four restaurants in a short period of time, covering Ypsilanti, Lansing, Detroit, and Ann Arbor. All restaurants specialize in traditional Sichuan dishes, requiring trained chefs when cooking. They were all well-ornamented, prepared for ceremonies. This is a great amount of risk for him, but he firmly believes that his business will be successful eventually because he is confident in the market. What he was doing was also unique and hard to copy.
Facing Difficulties: Accept Failures
Starting multiple businesses at the same time is not easy. There weren’t many clients and everything requires money: rent was very expensive and Mr. Zhong still needed to pay for utilities, staff, and operations. When I asked him if he has been discouraged by others, he replies, “I actually wanted to give up before anyone started to dissuade me from continuing.” The rate of revenue was very low while the monthly bill was very large. He became anxious, worried, and even questioned about his choice of investment.
After a huge loss, Mr. Zhong began to calm his mind and think rationally. He admitted that he was overly ambitious and he accepted his failure. In the end, Mr. Zhong made a tough choice: he closed several restaurants and kept some major ones, one of which is the most famous Chinese restaurant in Ann Arbor now called Ypbor Yan. It is also called the Emerald City, located at 4905 Washtenaw Ave.
Solutions to Problems: Solidarity is the Key
After that tough period, Mr. Zhong realized the importance of teamwork. There are so many talented individuals in Ann Arbor who specialize in technologies, marketing, construction, interior design, etc. One person’s ability is always limited. When there is a problem, it is easier both financially and emotionally to be with a team.
I learned an interesting logic from Mr. Zhong. He explained to me the benefit of being with a good team. Assuming a person who works alone can earn $10,000. When working with another partner, they share profit and each person earns $5,000. Then, one can gain $2,500 in a team of four people. This is may seem like a loss in revenue from cooperation. However, if the team is productive and united to work together toward a common goal, the person will still be able to end up with a $10,000 gain again if they opened four shops together. The net gain doesn’t change and the person now has four shops instead of one. Plus, he is with a trustworthy team. This is just a simple illustration with simple calculations. The real-life is a much more complex scenario, but the message he wanted to convey is clear: solidarity makes a difference.
In the end, Mr. Zhong teamed up with other talented partners who are very helpful on the operation side of the business. With all of their support and hard work, he overcame that difficult time and made his reputation.
Dealing with COVID-19: Being an Active and Positive Problem Solver
The second biggest challenge he faced was the pandemic. 65% of the U.S publicly traded restaurants are at the risk of bankruptcy, and about two-thirds of all restaurants are running with a negative capital gain. Mr. Zhong’s business is not big in comparison to McDonald’s, which makes his business even more difficult.
For Ypbor Yan (Mr. Zhong’s main restaurant in Ann Arbor), the number of clients declined substantially due to the COVID-19. According to Mr. Zhong’s account, Ypbor Yan’s profit dropped by more than 20%. The situation is even worse with strict state regulations.
“People should stop complaining about how bad the situation is and start looking for solutions to the problem, ” said Mr. Zhong. To boost his business while still sticking to the restrictions, he increased the distance between tables and chairs, increased outdoor activities, and broadened their channels of sales. But the effect of one’s effort is restricted when the economy is bad. Mr. Zhong acknowledged the weakening of the eatery industry and began to expand other projects that were not affected by the pandemic. These include Sichuan Guild Hall, Chinese Cuisine Museum, Culinary School, etc. He explained that the public is tired of quarantine. If we can build a space for people to have fun while still take their safety into account, the COVID will no longer be a threat to us. As a result, an activity center is built with a beautiful lake view.
“The pandemic will pass eventually just like all problems. Scientists are studying vaccines to cure COVID patients, and we should find solutions to our own issues.”
Mr.Zhong is 65 years old today. He is no longer that young man who just arrived in the U.S with excitement and ambition. When I asked him if he ever regretted his choice of coming to Michigan, he said, “If I can go back in time, I may change the way I run my business, but I will never regret my decision. I learned so much here. Michigan made some of my best memories.”
Feature photo credit: Fuhua Zhong