What is the 30% rule? This man says it will help NZ hospitality
Tuesday, 30 June 2026
An American entrepreneur has a theory on what Kiwi hospitality vendors should do to help their business.
Preston Lee, who spoke at the recent HNZ26 Hospitality conference in Rotorua, is the founder of business The 30% Rule. It’s a system designed to help restaurants increase revenue by focussing on staff, systems, training and leadership.
Forbes reported Lee had aided over 150 restaurants in generating an extra US$250 million in combined revenue by helping them to build them staff training systems and reducing staff turnover.
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So what is the 30% rule? In restaurants, it was common to put 30% of funding towards staff, 30% towards liquor, 30% to food, and 5% to overhead, Lee said, with the money left over as profit.
Corporate enterprises often steered their restaurants towards this rule; but according to Lee, the industry wasn’t focussing on the right things.
Instead, 30% of funding should be focussed on developing the business’ staff ‒ spending time with them, training them and nurturing them.
“Most businesses say we're going to train you over an initial onboarding training for five days, seven days, sometimes it's three days. They throw you out there - hoping you sink or you swim - and then get frustrated when you don't do well,” he said.
A common misconception was Gen Z did not want to work - something Lee said he disagreed with.
In the US, company Chick-fil-A was a successful brands. The chain’s restaurants were mostly run by young people, all who were performing at an extremely high level, he said.
This was because the company had leadership training and a focus on staff that allowed them to reach where they wanted to be, he said - giving its staff “purpose and buy-in,” and getting them out of a “this is just a job mentality”, he said.
When staff - particularly young staff - were treated like their only value was their functionality, it meant they felt no purpose in their work, he said.
“Gen Z is looking for purpose. Even if it's just a part-time job, they want purpose. They're showing up, spending time there… A lot of companies, what they do is train their employees like they're a cog in the wheel.”
Lee said he started working in restaurants as a young man, although his lackadaisical attitude and poor work ethic often saw him fired from his roles.
“When I became a server, I made good money, I became very entitled. I thought it was all about me and people were lucky to have me on their team. I had a really bad attitude,” he said.
After having his car repossessed and being a few weeks away from eviction, Lee said he knew it was time to change his attitude.
It was when he started working for a major corporate chain restaurant, he decided he was going to go all in, he said.
“My new attitude was all about the guest experience and obsessing over the guest experience and honouring the job that provided me with the way of life and income.”
Lee’s new attitude bought him great success, he said, almost doubling the restaurant’s revenue without the need to make any changes to its menu or provide promotions.
“Before that, I always thought I was all about hospitality, but I realized I was really just about tips… When my drive was truly hospitality, which is a selfless act, it really changed a lot of perspective for me, because I saw a lot of people respond really well to it.”
Eventually, Lee started applying his rule to other restaurants in the chain, and then got poached by other companies.
As someone who had worked extensively in Australia, Lee said he could see that New Zealand was struggling with the same issues as over the ditch: lack of training, lack of equity with training and a lack of focus.
With businesses, the number one goal was always revenue, he said - but the number one driver of revenue was customer retention, especially for restaurants, bars and accommodation providers.
“I could find good food, no problem. Can I find a place where I go in and feel like I'm valued?”