Bill Wright and Gary Sidhu
hope to snag the whole enchilada through the East Bay expansion
of Taco Del Mar.
The two have acquired the master developer rights to the Seattle-based
Mexican fast-food chain's charge into the Bay Area.
Wright plans to sell at least 15 franchised locations of
the restaurant in Contra Costa County by the end of 2005.
Sidhu, who owns a San Jose construction company, has even
more ambitious plans. He will sell up to 44 franchised Taco
Del Mar spots in Alameda County and San Francisco over the
next year. He will also build some of them.
Taco Del Mar Franchising Corp., which has more than 100 restaurants
in Oregon, Washington, British Columbia, Alaska, Arizona and
other Western states, has a fast-food format with a limited
menu featuring fresh ingredients. Tacos, enchiladas and burritos
are made fresh by employees, a production concept similar
to those at Subway sandwich shops and Chipotle, the Mexican
food fast-casual chain whose majority owner is McDonald's
Corp.
The chain's cornmeal-coated Alaskan cod fish taco is considered
its specialty and the average bill for customers falls between
$6.50 and $7. Besides fish tacos, Taco Del Mar restaurants
are known for their Baja California beach-influenced interiors
that inspire its "Release Your Inner Baja" marketing
slogan.
But it won't be La Paz or Cabo San Lucas where Wright and
Sidhu are seeking to build restaurants. They are examining
sites in strip malls, neighborhood centers and lifestyle centers
throughout the East Bay. More urban locations, such as the
tony neighborhood commercial streets in Oakland and Berkeley,
are not being ruled out.
"We have a location in Pioneer Square in downtown Seattle
near the sports stadiums, shopping and nightlife that has
been extremely successful," said Wright, a CPA and former
corporate vice president who developed 20 Subway sandwich
shops in Washington state with a partner. "But we have
to walk before we run, and the (suburban locations) are where
we will start building our business."
John Schaefer, vice president of the Terranomics
commercial real estate firm, is working with Wright to secure
locations. Schaefer said sites are being sought in Antioch,
Brentwood, Concord and Walnut Creek and in San Ramon near
the Bishop Ranch business park. High-traffic retail centers,
especially newer ones, are considered excellent places to
plant Taco Del Mar seeds when entering a new market, he said.
"Because the lunch business is key, ideal locations
are near business parks and other areas with large daytime
populations," Schaefer said.
At existing locations, about 60 percent to 70 percent of
Taco Del Mar's business is done at lunchtime, Wright said.
In addition to highly visible sites, Wright and Sidhu are
seeking franchisees willing to pony up the $20,000 needed
for a first franchise, $17,500 for a second and $15,000 for
each subsequent location.
The men say they realize competition will be stiff in the
restaurant-saturated Bay Area, but they predict the chain
will be a hit with a public short on time but more concerned
than ever with healthful food.
However, they and their franchisees are entering an area
already home to nearly 100 Taco Bell restaurants, the region's
most ubiquitous Mexican fast-food chain, and a total of 15
locations operated by the two major Mexican fast-casual chains
that also stress the quality of their food - Baja Fresh and
Chipotle.
Another chain known throughout the Pacific Northwest - Taco
Time - is also set to join the fray. It plans to open its
first East Bay location at Richmond's Hilltop Mall in 2005.
Up to 10 Taco Time restaurants may be opened around the region
during the next 12 to 18 months, said Mike Reagan, vice president
of Taco Time's parent, Kahala Corp., based in Scottsdale,
Ariz. They will be built near two of Kahala's other chains,
Surf City Squeeze juice bars and Rollers wrap shops.
Formidable competition can't convince Sidhu that the Bay
Area isn't big enough for all comers.
"I think it's very promising for Taco Del Mar,"
said Sidhu, who, as owner of Guru Electric and General Construction
in San Jose, also plans to build some of the new restaurants,
which average 1,000 square feet and 1,500 square feet and
cost an average of $600,000 to construct.
Fast-food and quick-service restaurants across the country
recorded sales of $135 billion in 2003 and expect to grow
by 4.5 percent this year, according to the National Restaurant
Association. Although still dominated by McDonald's and Burger
King, Irvine-based Taco Bell operates more than 6,000 locations.
Wright and Schaefer stress that when Taco
Del Mar enters a market, it likes to do so in a big way. That's
why it will open large numbers of locations.
"We're anxious to get our footprint in the county,"
Wright said, adding the company is big on radio and TV advertising.
"But we also will make a concerted effort to reach those
who live and work within two or three miles of our restaurants."
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