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Ones to Watch | By Sabrina Davis

Charo Chicken

The menu also includes Mexican-style chicken items, including burritos, quesadillas, tacos, salads, and the Charo Bowl (rice, beans, salsa, and chicken). There is also a spicy pepper jack chicken sandwich and the Moe’s Favorite Potato (baked potato topped with lemon garlic butter, chicken, salsa, guacamole, and cheese).

Charo locations serve 200–300 customers a day between 11 a.m. and 9: 30 p.m. Forty-five percent of sales take place at lunch; dinner makes up 55 percent. The average check for dine-in customers is $8.50; for carryout customers it is $11.75, and for delivery customers it is $26.00.

Delivery is an integral part of the Charo Chicken concept, with new stores starting at around 20 percent and maturing to an average of 40 percent of sales in delivery. “It’s a huge upside for us,” Perry says. “We are the only guys in the chicken category committed to home delivery.” Charo also caters, providing for events up to 2,000 people.

Charo units typically are built as 2,000-square-foot endcap units. One, so far, has a drive-thru window. Others are planned.

Charo Chicken
CEO: Ray Perry
HQ: Huntington Beach, California
Year Started: 1984
Annual Sales: $20 million
Total Units: 27
Franchise Units: 23

The company’s expansion is focused on Southern California, Texas, and Nevada. The first Texas store opened in Plano in early 2006; 12 others are planned around Dallas/Fort Worth. A Las Vegas store is also scheduled to open in October. “Las Vegas is a natural for us because so many Californians are moving or vacationing there,” Perry says. Current development agreements call for 96 stores to be built over the next five to six years.

WHY IT BEARS WATCHING: Charo Chicken might have modeled itself after successful competitor El Pollo Loco, but Charo’s leaders have been careful to set their concept apart with different flavors and a new modern look. Recent changes are credited to President and CEO Ray Perry, who was hired to prepare the chain for growth. He’s getting results.
With a constant stream of inquiries about franchising, Charo is poised to gradually cut into El Pollo’s market share.
“We’re getting calls from everywhere, including New York City, but we’re going to continue with controlled growth, making sure we can support every location operationally,” Perry says. Focusing on just a few states is plenty ambitious for now, Perry says; he sees room for 250 stores in California alone.
Charo intends to continually freshen its menu to stay current with customer demands. As more and more busy families look for dinner alternatives, Charo’s delivery service may help it edge out head-to-head competition.
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