In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the Chronic Tacos franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Chronic Tacos franchise, based on Item 7 of the company’s 2015 FDD
- Section III – Presentation and analysis of Chronic Tacos’ financial performance representations, based on Item 19 of the company’s 2015 FDD, including information on the:
- 2014 average gross sales for the top 25%, bottom 25%, and all 16 franchised Chronic Tacos restaurants that were open for 2 years or more as of December 31, 2014 and that provided unaudited data that the franchisor believes is complete, accurate, and reliable
- 2013 average gross sales for the top 25%, bottom 25%, and all 16 franchised Chronic Tacos restaurants that were open for 1 year or more as of December 31, 2013 and that provided unaudited data that the franchisor believes is complete, accurate, and reliable
Section I – Background Information
Chronic Tacos Plans to Build on Its Differences
An ambitious two-year expansion plan for Chronic Tacos projects 50 new locations for the Mexican grill by September 2016. The chain, based in Aliso Viejo, California, started the plan with about 30 North American locations. Colorado is one of the states pegged for the chain to enter in 2016.
“I’d love to bring the awesomeness of Chronic Tacos to every state and across the world,” co-founder Randy Wyner said in a news release in December 2014.
Chronic Tacos expects to reach 100 stores by 2018.
Celebrating Taco Life
The chain celebrates what it calls the Taco Life (indeed, Wyner has the words tattooed on the fingers of both hands), which represents a lifestyle that encourages individuality. President and CEO Michael Mohammed said the restaurants embrace their local surroundings while also sticking with the chain’s California roots.
Mohammed and brothers Dave, Dan and Joey became involved with Chronic Tacos in 2010 when they helped finance the chain’s first location in Canada.
The success of the 15-year-old Chronic Tacos, which is currently confined to U.S. locations in California, Nevada and Arizona, as well as three restaurants in British Columbia, Canada, is based on both quality and atmosphere. Chronic Tacos stresses authenticity, quality and local ingredients and will in 2016 include all-natural meats on the menu and expand vegetarian options.
Founders Were Looking for Good Mexican Food
Chronic Tacos began in 2001, founded by Wyner and Dan Biello, who were frustated by not being able to easily find high-quality, tasty, fresh Mexican food in Newport Beach, California. They were provided with some family recipes by a Mexican-American friend.
The chain’s authentic third-generation recipes are a major focus for the chain, which also features edgy decor inspired by Día de Muertos (Day of the Dead), the annual Mexican holiday in which people honor the dead through festivals, parties, food and drink, and brightly colored decorations. The observance combines ancient Aztec rituals with Roman Catholic traditions introduced by Spanish conquistadors. While a Mexican observance, Day of the Dead has developed quite a following in the United States as well.
Menu Includes All-Day Breakfast, Fish and Shrimp Options
On the menu are burritos, tostada bowls, tortas, taquitos, flautas, salads and tacos, and a breakfast menu is open for business all day long. Meats include 24-hour-marinated steak (carne asada) or chicken (pollo asado), slow-cooked pork shoulder (carnitas), 24-hour-marinated diced pork shoulder (al pastor), and mahi mahi or ono fish or shrimp, served grilled or beer-battered. Customers can also choose from authentically prepared beans, made from scratch, paired with rice and topped with guacamole and salsa. Guacamole and pico de gallo are prepared from scratch with locally sourced ingredients.
The chain’s Ghost Pepper Hot Sauce developed a strong following when it was introduced as a limited-time offering, to the point that it became a full-time menu item in 2014. The sauce is based on the chain’s standard red sauce with the addition of ghost peppers and habaneros.
Among Chronic Tacos franchisees are Jason Acuna of the MTV show “Jackass” and Caleb Walker, brother of the late Paul Walker.
Section II – Estimated Costs
- Please click here for detailed estimates of Chronic Tacos franchise costs, based on Item 7 of the company’s 2015 FDD.