Fast-casual Mexican food fans, rejoice! San Diego-based restaurant chain QDOBA has announced its ambitious plan to double the number of restaurants over the coming decade, with plans to open as many as 80 new locations each year. Currently operating 750 restaurants in 45 states, the company intends to add 40 new locations this year, 60 in 2024, and finally 80 annually starting from 2025, according to a Times of San Diego report.
This rapid expansion strategy comes after QDOBA's astounding success, posting 10 consecutive quarters of positive sales growth and boasting average restaurant volumes of $1.6 million. For the fifth consecutive year, QDOBA was voted the "Best Fast Casual Restaurant" as part of the USA TODAY 10Best Readers' Choice Awards, PR Newswire noted.
John Cywinski, CEO of Modern Restaurant Concepts - QDOBA’s parent company - stated that the brand is exceptionally well-positioned in one of the most attractive restaurant categories, possessing long-standing momentum, strong unit economics, and a compelling operating model. Moreover, QDOBA has an extraordinarily passionate guest following and significant untapped geographic potential, which will be vital in driving growth over the next decade, according to the Times of San Diego.
As part of this aggressive expansion plan, QDOBA intends to focus heavily on franchising. The company is currently about 80% franchised with 85 franchise partners in the U.S., a number that is expected to grow along with the new restaurant openings. In keeping with its selective refranchising strategy, QDOBA recently sold 77 company-owned restaurants to its largest franchise partner, North Fork Fresh Mex, which now operates 97 QDOBA locations across Missouri, Illinois, Indiana, Kentucky, and Virginia, PR Newswire reported.
Not only has North Fork become QDOBA's largest franchise ally, but it has also committed to building 73 new restaurants over the next seven years, providing further momentum for the ambitious expansion strategy, Restaurant Business Online revealed.
According to the same Restaurant Business Online article, QDOBA is betting on franchising to propel the brand's growth. John Cywinski, who previously led Applebee's, an almost entirely franchised brand, is now focused on QDOBA's growth through the asset-light model. The San Diego-based chain aims to “aggressively accelerate” new restaurant development in partnership with both existing and new franchisees, with a goal to sustain a 10% annual growth rate.
Jacob Stauffer, North Fork’s co-owner, expressed enthusiasm and optimism about the agreement with QDOBA. He believes it offers a tremendous opportunity to not only expand the business but also benefit team members throughout the organization. Stauffer shared that they have seen great success since aligning with QDOBA years ago and understand the brand provides a distinct business advantage as they tackle significant, yet underserved markets in the future, according to a Restaurant Business Online report.
While QDOBA is the nation's second-largest fast-casual Mexican chain, it still has a long way to go in catching up to its rival, the 3,200-unit Chipotle Mexican Grill, which aims to reach 7,000 units in North America. As QDOBA seeks to make its mark in the fast-casual Mexican food industry, it seems only time will tell whether its franchising-focused strategy will bring about the growth and success they envision.
