Hefty burritos stuffed with ingredients such as steak and shrimp are the star of the show at Bubbakoo’s.
Mexican restaurant franchise Bubbakoo’s Burritos doesn’t only serve Mexican food. In fact, is incorporates flavors from all over the world, Chief Financial Officer Chris Ives said.
“We are totally something different, where we’re not your traditional Chipotle or Moe’s or Qdoba, that’s coming in with the basic proteins and flavor profiles that they have in the Mexican category,” Ives said. “We take it to a different level and we infuse flavors from all around he world and put them into the Mexican pillars.”
Brand growth last year came internally, with existing franchisees looking to develop more restaurants.
Every Mexican brand returning to the Franchise Times Top 400 list this year saw positive sales growth, even if unit count decreased. Bubbakoo’s is the top grower in the category with 2022 sales topping $80 million; it climbed 66 spots on the list to No. 364. Bubbakoo’s sales increased by $30 million in 2022, or 60 percent over 2021. Bubbakoo’s added 33 new units last year, an increase of 55.6 percent, to 98 units.
Pancheros serves Mexican fare, shown above. The brand grew sales by 17 percent in 2022.
The largest franchise in terms of sales is by far Taco Bell, which saw total systemwide sales hit $14.7 billion in 2022. The next largest are Qdoba Mexican Eats and El Pollo Loco, with sales just over $1 billion. Qdoba, No. 78, cracked the top 100 this year with sales topping $1 billion and adding only two stores to its system in 2022. El Pollo Loco, No. 76, climbed 22 spots up the Top 400 list this year, with sales also hitting just over $1 billion. The franchise added 10 stores to its net unit count last year.
Each of the bottom three brands in the Mexican sector had positive sales growth, but negative unit growth. Moe’s Southwest Grill, with sales of $705 million, lost 23 stores, a 3.5 percent dip; Del Taco had sales hit $957 million and with a unit count drop of nine stores, a 1.5 percent decrease; and Taco John’s lost 17 units, 4.4 percent overall, despite sales increasing by 2.4 percent to $420 million.
No. 391 Baja Fresh is new to the Top 400 list this year, with $63 million in sales across 86 units. The Scottsdale, Arizona-based brand started in 1990 with the mission to serve Mexican food with fresh, never processed ingredients. The franchise boasts not having can openers, freezers or microwaves inside its stores.
Pancheros Mexican Grill, the second top grower in the Mexican category, has been emphasizing its digital marketing and loyalty initiatives for three years now, founder and President Rodney Anderson said. The brand’s sales increased 17 percent to $105 million, according to Franchise Times’ estimates.
Rodney Anderson, founder and president of Pancheros, said the brand has been emphasizing its digital presence for the past three years.
“Our loyalty usage through our app for our transactions is much higher than the average in the industry,” Anderson said. “We’ve got a lot of loyal customers, and that’s how we really market to them.”
The brand was successful even when other brands were closing stores throughout 2020, Anderson said, so he sees opportunity for growth going forward. The challenge, though, is combating inflation—the same issue the majority of brands are facing—and third-party delivery costs, Anderson said. Digital sales now make up for 27 percent of Pancheros’ sales.
“The challenging part is the cost of the digital sales and the third-party delivery services, trying to factor that in the pricing and how we charge customers for those services,” he said. “That isn’t quite built into the true economic model yet. So, I think that’s a focus of our right now.”