Taco Bell could have more than 200 restaurants operating within the next five years if the UK market’s appetite for the brand takes off in the way it expects, its European boss has said.
The Tex-Mex chain presently operates more than 30 stores after a flurry of new openings in the past 12 months, with key franchise partners also investing in building their portfolio.
The arrival of former Nestle man Jorge Torres as general manager of Europe last year has also injected fresh impetus to the brand as it seeks to grow its UK footprint.
With Taco Bell rolling out a string of London restaurants and eyeing new locations right the way across the UK, there is a genuine feel from within the business that it is transitioning from a smaller player within the market to a true multi-site force.
Asked what his longer term ambitions are for the business, Mr Torres told FEJ: “Over the next five years my dream would be to get to 200 restaurants in the UK. I think there is so much potential — the long-term potential of this brand in the UK is several hundred, let’s put it that way.”
Mr Torres believes there is enough capacity and appetite for investment among its existing franchisees to meet the expansion targets it has set.
“There are franchisees that are really excited and capable of continuing expansion. We prefer to work with fewer, bigger franchisees — it is more efficient for us as we are building a team and maximising our resources. It all depends on how big the market is and what the potential of the market is — the UK is so big right now that there is still room to grow.”
Just a small percentage of Taco Bell restaurants worldwide are still owned by the brand, with the rest comprised of franchisees. The UK mirrors that franchise-led approach, with the brand currently reliant on four core franchisees for its coverage.
This includes Caskade Caterers and QFM Group, its two largest partners, which are both experienced franchise operators. Last year Caskade secured a funding package worth almost £30m to drive the roll-out of new sites in the south of England.
Taco Bell has had something of an indifferent relationship with the UK market. It put a flag in the ground in 1986, initially targeting high profile locations such as Leicester Square, but a general lack of marketing and awareness around the Tex-Mex genre meant that rapid growth was hard to come by.
After largely disappearing from view in the 90s, current owner Yum! Brands reignited its appetite for UK sales by opening a series of new stores, but strayed from the previous strategy with less of a city-centric approach. Today, about 50% of its outlets are based on the high street.
“We have 27 restaurants in the UK right now and we will continue looking for the right opportunities,” said Torres at the recent opening of its Hammersmith store. “Outside of London we are also opening about eight more restaurants in the north and south, so there is definitely momentum of expansion at Taco Bell.”
Outlets in Camden, Holborn, Fulham and Croydon, as well as Portsmouth, Doncaster, Great Yarmouth and North Ayrshire all feature on the agenda.
Taco Bell’s central operations team is based in Woking, in the same office building as parent Yum!’s other key brands, KFC and Pizza Hut. The chain now has a new space on the first floor and Torres says there are benefits to be had from being in such close proximity to its sister brands.
“I feel very lucky that we have KFC next to us. KFC UK is maybe among the top five markets in the world and KFC is our largest brand in Yum!, so the amount of resources and connections that they can offer is endless. They are a great partner because we are family and so there are many things that we share, for instance, such as distribution partners, suppliers and production facilities. Although it is not identical, it is very well integrated so that we can take advantage of the scale that KFC offers as well.
“On top of that you’ve got knowledge transfer in terms of consumers and trends, so I think that it is absolutely an advantage. And you will see that in many countries our franchisees are also KFC or Pizza Hut franchisees — not always but in many cases they are. And that is good because they understand the way of doing business with Yum!, which makes for a very smooth relationship.”