Del Taco

Del Taco Holdings, Inc.
Type Private
Industry Restaurants
Founded 1964 in Yermo, California
Founder(s) Ed Hackbarth
Headquarters Lake Forest, California, US
Number of locations Over 526 (As of July 13, 2011)[1]
Owner(s) Charlesbank Capital Partners and Leonard Green & Partners
Website deltaco.com

Del Taco is a North American fast food restaurant chain which specializes in American-style Mexican cuisine as well as American foods such as burgers, fries, and shakes. Del Taco is led by Paul Murphy, Chairman and CEO, and is headquartered in the city of Lake Forest, California.[2]

Contents

History

1960s

Originally named Casa Del Taco ("House of the Taco"), the first Del Taco restaurant was founded in Yermo, California in 1964 by Ed Hackbarth. On the restaurant’s first official day of business, Del Taco made $169.[3] In 1964, Hackbarth partnered with David Jameson. Success of the first restaurant led to two in Barstow one in Needles, and a fifth restaurant in Corona (the first Del Taco with a drive-thru window). Dick Naugle, who installed the kitchen equipment in the Corona store, was impressed by the design and joined Hackbarth and Jameson in the fledgling business. In 1966, the trio founded Red-E-Food Systems, Inc. with the idea of franchising the Casa Del Taco brand.[4] That same year, the original Del Taco sun logo was created and in 1967, Del Taco introduced their famous bean and cheese burrito with green or red sauce to their menu.[3] Before long, the restaurants were being founded throughout Southern California.

1970s

Naugle left the company early in the decade to start his own Mexican fast food chain, Naugles. In 1973, the company dropped “Casa” from its name and Red-E-Food Systems became Del Taco, Inc. By that time, the company was enjoying a remarkable growth spurt; during one period, they were opening a new restaurant every month. However, in 1976, Hackbarth and Jameson sold Del Taco to a group of investors. The new owners sold the exclusive rights to use and develop the Del Taco name throughout the United States (excluding California; Eugene, Oregon; and Yuma, Arizona) to W. R. Grace and Company. Grace, primarily a chemicals company, founded a new company, Del Taco Restaurants Inc. of Dallas, Texas, and a new subsidiary, DTG Inc., to oversee the various fast food chains it was acquiring.[4] Nonetheless, the franchise continued to expand. In 1977, there were 50 Del Taco restaurants. A year later in 1978, there were 100.

1980s

In 1981, Del Taco had roughly 350 restaurants (still located almost exclusively to California).

In February 1988, Del Taco merged their restaurants with the 171 Naugles’ Mexican fast food outlets owned by one-time Del Taco owner Dick Naugles. Anwar Soliman was the man behind the move and was, ironically, the mastermind behind the purchase of the rights to expand Del Taco throughout the United States back in 1977.[4]. With the merger, Del Taco increased in size, and spread as far east as Hickory, NC. The 1980s also brought change in the operation, as Del Taco began to stay open all night long.[3] In Lake Forest, California, where the chain is currently headquartered, there are two Del Tacos directly across the street from each other on Trabuco Road - one of these having formerly been a Naugles.

1990s

Del Taco's logo from 1992 to 2011

In 1990, Kevin K. Moriarty joined Del Taco as the new CEO, soon becoming the owner of the brand in conjunction with his management team. His team launched new efforts to grow the brand’s image while improving the total customer experience, setting the stage for extreme growth.[3]

In 1992, Del Taco recaptured exclusive rights to its name from W. R. Grace and Company and was now able to expand outside of California.[5] Del Taco launched a $14 million program to redesign its restaurant exteriors, kitchens, and corporate logo. The company presented its Concept 2000 restaurant design and in August 1992 introduced its new logo. In place of the old orange and blue sunset, there was a yellow sun that rose over green mountains against a red background; these colors represented the primary ingredients of Del Taco food: cheese, lettuce, and tomatoes. Later that year, executives announced far-reaching plans to expand the chain to 500 stores by 1995 and to add another 225 by 2000. The first new markets it set its sights on were Las Vegas, Nevada; St. Louis, Missouri; and the Northeast Corridor.[4]

Del Taco filed for protection in 1993 under Chapter 11 in U.S. Bankruptcy Court. In spite of the fact that renovations were made to keep Del Taco profitable, the company continued to pay rent on several unprofitable outlets that had already been closed. They also attempted to negotiate lease reductions on a number of other high cost sites. To make matters worse, Del Taco had been hit with a $3 million lawsuit from a former supplier, which was later settled out of court.[4]

In the five years from 1994 through 1998, Del Taco saw their company decrease and (eventually) increase in size. Though the company signed a deal to open 15 franchise stores in the Northeast with many more in the Southeast, the chain was nowhere near the goals publicized years earlier. In 1995, Del Taco (hurt by the closing of numerous unprofitable units) had only 300 stores, instead of growing to 500 stores. However, the chain began to prosper in 1997, when their total sales had reached an estimated $250 million. By December 1998, Del Taco boasted 325 stores in twelve states and hoped to be debt-free by 2002.[4]

2000s

In 2000, Del Taco had 372 stores located in ten U.S. states. Also that year, an important deal was signed with the Compass Group PLC that enabled Del Taco stores to open on American military bases. The first to do business was the store at Patuxent River Naval Air Station at Maryland, USA in early 2001. Other Del Tacos were planned for American bases in Puerto Rico, Naples, and Italy.[4]


In early 2002, a group of former Del Taco employees, all of whom were black, brought a discrimination suit against the chain. The group claimed that while working at Del Taco in the Los Angeles area, they had suffered verbal abuse, had been passed over for promotions in favor of Hispanic workers, and were being fired and replaced by illegal immigrants. The case had not been settled.[4]

In an effort to improve its reputation, Del Taco launched a sports-sponsorship program with teams in eight U.S. states, including the Mighty Ducks of Anaheim and Phoenix Coyotes hockey teams, basketball’s Los Angeles Clippers and Utah Jazz, the University of Nevada at Las Vegas’s football and basketball teams, and several minor league hockey and baseball teams.[citation needed] The deal placed the Del Taco logo on signs, drink cups, and special promotional items at the stadiums of the partner teams. It paid off as, in 2003, Del Taco announced that their restaurants topped $1 million per store in average annual sales, which was more remarkable considering that other American stores, notably McDonald’s and Carl’s Jr., featured a decrease in annual sales.[4]

In 2006, a private Nashville, Tennessee based holding named Sagittarius Brands, LLC, which is also the parent company of Captain D's Seafood, purchased Del Taco.

In January 2008, Del Taco announced the opening of its 500th restaurant in Burbank, California, USA.[6] On April 27, 2009, a new Del Taco opened in Oviedo, Florida, marking the first time since the 1980s that Del Taco was available in the Orlando area.[7]

2010s

Del Taco in Denton, Texas opened in 2010.

Del Taco returned to Texas with a new location in the north Dallas suburb of Denton, Texas. W. R. Grace and Company had previously owned and operated locations in Texas with a licensing agreement in 1978, but sold the restaurants to Taco Bell in 1992.[8]

Captain D's was sold in 2010 to Sun Capital Partners.

Guillermo Perales, one of the largest Hispanic restaurateurs in the nation, signed a franchisee agreement to open additional locations in the Dallas-Fort Worth area of Texas.[9]

Demographics

The chain is concentrated in 16 states in the U.S.A., with the majority of its restaurants on the west coast (California, Oregon, and Washington) or in other western states (Arizona, Colorado, Idaho, Montana, Nevada, New Mexico, and Utah).[10]

Las Vegas, Nevada has the most Del Tacos of any one city[11] and California has the most Del Tacos of any one state by far.[12]

Products

Del Taco serves two different types of food: Mexican and American. Their standard menu includes Hard Shell Tacos, Soft Tacos, Burritos, Quesadillas, Nachos, Jalapeño Rings, Deluxe Taco Salad, Crinkle Cut French Fries, Chili Cheddar Fries, Double Del Cheeseburger, Bacon Double Del Cheeseburger, Triple Del Cheeseburger, Shakes, and at least four types of Breakfast Burritos.[4]

Marketing

The first mascot of Del Taco was a character of the same name used from 1999 through 2000. While popular, Del Taco (the company) was hit by a lawsuit from Zorro Productions, Inc. and Tristar Pictures, Inc., who claimed that the "Del Taco" character – masked and costumed in black – infringed on their rights to the trademark Zorro figure. Del Taco settled the suit in January 2000, agreeing to make changes to the Del Taco character, but soon discontinued the ad campaign altogether.[4]

In its place, from 2000 through early 2006, Del Taco used Gregg Binkley to play Dan in their commercials. Dan, a clumsy marketing spokesman for Del Taco, was famous for his antics during their commercials. Among other things, Dan destroyed cars, broke hockey-rink glass, and mistakenly held a sales event at a nude beach, all while promoting a specific item for Del Taco.[13]

From August 2007 through July 2008, Del Taco featured "The Beast" in their commercials. "The Beast", a personification of hunger, typically stood next to a customer and persuaded him to order a particular item (or particular items) so that they could "Feed the Beast" (which was Del Taco's slogan at the time). "The Beast" made his debut in August 2007 promoting Del Taco's improved Chicken Soft Taco. In addition, he endorsed the Crispy Fish Taco in February 2008, the improved Chicken Quesadilla (with 50% more chicken) in April 2008, and Del's Deal (two half-pound bean and cheese burritos, a regular crunchy taco, and a small drink for $2.99) in June 2008.[citation needed]

Currently, Del Taco uses a variety of commercials to promote their new slogan, "Go Bold or Go Home." The first commercial featured a team of miniature "Mole Men" to promote the Spicy Chicken Mole Soft Taco, which aired in August 2008. Future ads included Del Taco's promotion of their improved regular taco in September, the Classic Combo Deal in November,three separate meal deals for under three dollars (including the aforementioned deal) in January 2009,[14] the crispy shrimp taco in February,[15] the chicken soft taco in April,[16] and the chicken fajita burrito in June.[17]

References

  1. ^ Del Taco. "Del Taco Distinguishes Top Franchisees". Deltaco.com. http://www.deltaco.com/index.php?page=12&item_id=78. Retrieved 2011-06-27. 
  2. ^ "Feedback." Del Taco. Retrieved on February 25, 2010.
  3. ^ a b c d Del Taco (2008-09-19). "Del Taco History". Deltaco.com. http://www.deltaco.com/page11.html. Retrieved 2011-06-27. 
  4. ^ a b c d e f g h i j k "Del Taco History". Fundinguniverse.com. https://www.fundinguniverse.com/company-histories/Del-Taco-Inc-Company-History.html. Retrieved 2011-06-27. 
  5. ^ Woodyard, Chris (1992-07-28). "Bidding for a Bigger Bite". Los Angeles Times. http://articles.latimes.com/1992-07-28/business/fi-4593_1_del-taco. Retrieved 2010-04-30. 
  6. ^ "Del Taco Opens 500th Restaurant", QSR, Journalistic, Inc., 8 January 2008.
  7. ^ Collings, Buddy. "Local varsity athletes juggle bases, turf", Orlando Sentinel, 8 April 2009.
  8. ^ Woodyard, Chris (1992-04-04). "Del Taco--Not That One--Is Sold". Los Angeles Times. http://articles.latimes.com/1992-04-04/business/fi-233_1_del-taco. Retrieved 2010-04-30. 
  9. ^ Robinson-Jacobs, Karen (2011-02-25). "Franchisee will open Del Tacos in Dallas-Fort Worth area". Dallas Morning News. http://www.dallasnews.com/business/headlines/20110225-franchisee-will-open-del-tacos-in-dallas-fort-worth-area-.ece. Retrieved 2011-07-13. 
  10. ^ Del Taco (2010-01-13). "Locations". Del Taco. http://www.deltaco.com/index.php?page=7. Retrieved 2011-06-27. 
  11. ^ Del Taco (2010-01-13). "Del Taco Demographics". Deltaco.com. http://www.deltaco.com/index.php?page=20&state=NV. Retrieved 2011-06-27. 
  12. ^ Del Taco (2010-01-13). "Demographics". Del Taco. http://www.deltaco.com/index.php?page=20&state=CA. Retrieved 2011-06-27. 
  13. ^ "Del Taco Marketing". Ocregister.com. 2007-03-02. http://www.ocregister.com/ocregister/money/homepage/article_1596414.php. Retrieved 2011-06-27. 
  14. ^ "Press Release by Del Taco for January 2009". Reuters.com. http://www.reuters.com/article/pressRelease/idUS184270+13-Jan-2009+BW20090113. Retrieved 2011-06-27. 
  15. ^ "Press Release by Del Taco for February 2009". Reuters.com. http://www.reuters.com/article/pressRelease/idUS224024+25-Feb-2009+BW20090225. Retrieved 2011-06-27. 
  16. ^ "Press Release by Del Taco for April 2009". Qsrweb.com. http://www.qsrweb.com/article.php?na=1&id=14199. Retrieved 2011-06-27. 
  17. ^ "Press Release by Del Taco for June 2009". Reuters.com. http://www.reuters.com/article/idUS132234+15-Jun-2009+BW20090615. Retrieved 2011-06-27. 

External links

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