Business Spotlight | Spring 2019
Marc Schulman, president and owner of the family business, Eli's Cheesecake Company and his wife Maureen.

Growing the family business at Eli's Cheesecake Co.

Eli’s Cheesecake Co.’s CEO is building on the entrepreneurial legacy of his father

By Erik Cassano

Few people are fortunate enough to create one major dining attraction in a city the size of Chicago. Eli Schulman created four.

In a career that spanned five decades, Schulman founded a coffeehouse, a delicatessen and a steakhouse, each serving as a steppingstone that propelled Schulman from a small restaurateur to Chicago icon.

Beginning with Eli’s Ogden Huddle coffee shop in 1940, he built on a growing reputation that allowed him to launch Eli’s Stage Delicatessen shortly thereafter, followed by Eli’s The Place for Steak in 1966. His steakhouse became a hangout for politicians and celebrities, making it one of the most well-known restaurants in the city.

But Schulman’s lasting legacy doesn’t reside with any of those establishments, all of which have long since closed. Instead, it rests with the signature dessert developed in his steakhouse kitchen. That dessert is the foundation for his fourth and final Chicago institution, Eli’s Cheesecake Co.

Eli Schulman died in 1988, leaving control of the restaurant to his wife, Esther, and son, Marc, who had been heading up the bakery since its inception in 1983. With Esther’s death in 2009, Marc Schulman assumed control of the restaurant, while growing the bakery, which produces 20,000 cheesecakes and desserts daily, distributing them to stores and restaurants around the country from a single facility in northwest Chicago.

The younger Schulman has the weight of nearly 80 years of culinary and business success on his shoulders. But he believes his company can continue to uphold what his father built.

“We have great recipes and great people, and if you’re working from that as your base, you’re starting from a great place,” Schulman says. “I saw how hard my parents worked all those years, and that type of work ethic still permeates our business. We work hard on maintaining quality and high customer service standards each day.”

Cheesecakes roll out of an oven at Eli's Cheesecake Factory.
(Photo by Sara Stathas)

Building the business

Though Eli Schulman found incredible success in the restaurant business, he understood that it was a notoriously evolving industry. Restaurants often decline and fail for reasons beyond their control.

“Restaurants are difficult to plan around,” Marc Schulman says. “They’re often at the mercy of their location. Major road construction, bad winters, they can all impact your ability to bring customers in the door. My father wanted to develop a business where he had more control over those variables.”

He knew his cheesecake recipe would sell—it was one of the most popular dishes at his steakhouse. So in 1980, he decided to make his cheesecake the foundation of a new business, one that would be built around production and distribution instead of table service.

“We launched the new business at the first Taste of Chicago in 1980, and the cheesecake was a hit,” Schulman says. “That’s when we really decided to start focusing all of our efforts around the cheesecake business.”

Eli’s Cheesecake Co. launched with four varieties of cheesecake, all sized the same. Maintaining that small selection might have turned Eli’s Cheesecake into a solid side business and a major brand around Chicago, but the Schulman family had bigger ideas. They wanted their company to become one of the biggest and best cheesecake companies in the nation.

“If we had just continued to sell those few flavors, we probably wouldn’t have stayed around,” Schulman says. “But my father saw an opportunity for supermarkets to carry premium desserts at a time when that wasn’t very common.”

In the years following the company’s founding, they began slowly expanding the selection of products. Eli’s Cheesecake now offers more than 100 frozen and refrigerated desserts, including over 40 flavors of cheesecake, as well as layer cakes, bars and tarts, distributed coast to coast.

Marc Schulman, president and owner of the family business, Eli's Cheesecake Company, photographed in the test kitchen of their headquarters.
(Photo by Sara Stathas)
We have great recipes and great people, and if you’re working from that as your base, you’re starting from a great place.
Marc Schulman
President, Eli's Cheesecake

Maintaining momentum

To maintain a high level of quality control—and to maintain the company’s commitment to Chicago—Schulman has never considered opening additional production or warehouse facilities in other parts of the country.

However, the trade-off is that it makes shipping more challenging. Perishable desserts have to cross hundreds of miles to their destinations without spoiling or losing flavor.

The key for Eli’s Cheesecake is to make the product, then freeze it as quickly as possible. Despite their dairy-based components, cheesecakes retain their texture and taste after freezing.

“We’ve been doing that since the beginning, and it’s worked out quite well,” Schulman says. “But it’s not just a matter of freezing them and getting them out the door. There is a critical people component to running a large operation like this, and doing it well.”

Eli’s Cheesecake employs 220 people, and each one plays an important role in making sure the company can fulfill thousands of orders each year, each one of them to the satisfaction of the customer. That means every employee has to buy into the standards of product quality and customer service set forth by management, and perform to those standards each day.

“We put our people through a lot of vetting during the hiring process, and once they’re aboard, we do a lot of training,” Schulman says. “There are a lot of steps to go through, because we want them to be here for a long time. We do a lot of promoting from within, so there is an opportunity to grow in their career here. We’ve had great success with that, as far as retaining people.”

It’s only with a talented, aligned and motivated workforce that Eli’s Cheesecake will continue to grow and adapt as a company. The recipe for cheesecake may not change, but the market still shifts, and the business components of the company need to constantly evolve.

Recently, Eli’s Cheesecake has partnered with coffeehouses, airlines and other counter-service chains to provide dessert selections for their menus. It’s another way to reach customers, outside of the traditional supermarkets and table-service restaurants that usually sell cheesecake.

The company has also branched into products for those with special dietary needs.

“Innovation is actually a big part of our business,” Schulman says. “We’ve innovated on the product development side, with vegan and gluten-free desserts, and on the sales and distribution side. We’re having more involved discussions about how we can utilize our website and other e-commerce vehicles to reach our customers more effectively.”

For Schulman, it all comes back to building upon what his father created. Schulman doesn’t want to just follow in his father’s footsteps; he wants to use them as the foundation for something even greater, proving that you can sustain and grow a successful modern business—even if it’s built around a traditional product like cheesecake.

“We’re trying to think ahead, just like my father did,” Schulman says. “The reason he was so successful in everything he did was not just that he worked hard, but he was always driving toward something. He could see what was coming and adapt to it. I don’t think you can survive in business, let alone succeed, unless you have that ability to look down the road and be proactive about running your company.

“We didn’t just stay tied to the restaurant business, and that was because of him. He saw the value in diversifying your business lines, investing in products and people. He really drew up the blueprint for everything you see now.”

(Photo by Sara Stathas)

A Chicago bank, based in Ohio

Banking can seem impersonal, but when Huntington Bank sent representatives to the headquarters of Eli’s Cheesecake, Eli’s Cheesecake President Marc Schulman was impressed.

“Pretty early in our relationship, they came out to visit us,” says Schulman. “I didn’t know what to expect at first, but I found out they’re very supportive of middle-market customers in the Midwest. It’s not usually what you hear about a bank.”

For Schulman and his team, Huntington has all the resources they need and the relationships that help the business succeed.

“They have everything we needed as far as banking functions,” Schulman says. “Huntington delivers all the support we need. It’s impressive. With their support, they allow us to put our focus where it should be—working hard on continuing to improve our company.”

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