In this FDD Talk 2015 post, you’ll learn the following:
- Section I – Background information on the Salsarita’s Fresh Cantina franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Salsarita’s Fresh Cantina franchise, based on Item 7 of the company’s 2015 FDD
- Section III – Presentation and analysis of Salsarita’s Fresh Cantina’s financial performance representations, based on Item 19 of the company’s 2015 FDD, including information on the:
- 2014 average gross sales, cost of goods sold, payroll, occupancy costs, miscellaneous operating expenses, and operating profit for five of the eight Salsarita’s Fresh Cantina Restaurants owned and operated by the franchisor’s affiliates
- 2014, 2013, and 2012 average annual gross sales for franchised and affiliate-owned Salsarita’s Fresh Cantina Restaurants at traditional locations that were open and operating for the entire relevant period
Section I – Background Information
Salsarita’s Fresh Cantina is a Mexican food chain that got its start back in 2000 in Charlotte, North Carolina by founder Bruce Willette. It calls itself an authentically-inspired fast casual Mexican restaurant. It aims at hitting just the right blend of fast and friendly, casual and delicious.
It focuses on customizable burritos, bowls, tacos, salads, nachos, quesadillas, and Mexican pizzas, and also offers an array of sides, kid’s meals, breakfast items, and margaritas for the adult set.
With about 72 locations in 19 states (mostly the eastern half of the US), the chain is looking to grow. Here’s how Salsarita’s keeps the Mexican beans jumping in the fast casual segment:
A Fresh Menu
Salsarita’s prides itself on its use of fresh ingredients for everything on the menu from its signature salsas and fresh-made guacamole (hand-mashed and always on the house for entrées) to its wildly addictive chips and signature entrees, such as its wet burrito called the CasaRito (available in three flavors including Tomarito, topped with green tomatillo sauce; Quesarito, topped with cheese sauce; and Rancharito, topped with a red ranchero sauce) and the Cantizza, a tortilla pizza available with chicken fajita, barbecue pork, beef taco, or steak nacho toppings.
Veteran franchisor Phil Friedman bought the chain back in 2011. He previously made a name for himself during 11 years at the helm of McAlister’s Deli, a chain he expanded from around 30 units to nearly 300.
In 2014, Friedman took even greater control of Salsarita’s daily operations by stepping into the CEO role for the chain.
One of the things Friedman did after acquiring the chain in 2011 was to do a thorough revamping of the menu with culinary experts over the course of two years. They looked at every single menu item and considered what improvements could be made.
Based on their goal of freshness, they made changes such as cooking the chain’s most popular protein choice, chicken, in smaller batches throughout the day; came up with new recipes for salsas and salad dressings made fresh in-house; and also re-branded several of the entrées.
These improvements were almost all made without raising prices, thanks to tweaking their procurement system.
In 2014 the chain seemed to think things were looking up. Four new multi-unit franchise development deals were signed in such markets as Lewisville, Texas; Savannah and Alpharetta, Georgia; and Asheville, North Carolina. These agreements were meant to see as many as 22 new restaurants open in those areas. However, there were 82 locations at the end 2011, and 2012-2014 saw a net loss of locations down to 71. And in 2015 there are only 72.
Since April, the company’s blog only has one article posted about a new restaurant opening back in July in Oxford, Mississippi. And there is no press or media room on the website, which seems odd since that’s a place where new openings and developments tend to be trumpeted.
Still, the chain is in the early stages of making sure the fundamentals are strong before rapid growth begins.
Section II – Estimated Costs
- Please click here for detailed estimates of Salsarita’s Fresh Cantina franchise costs, based on Item 7 of the company’s 2015 FDD.