Web Exclusive | March 2016 | By Nicole Duncan

Coming to America

Two overseas brands prepare to cut their teeth in the hyper-competitive U.S. fast-casual industry.
International QSR restaurant chains aim to grow business in United States.
Carvera Argentinean Grill opened the first location in the Florida Mall in Orlando in February. image used with permission.

The U.S. has long been called “the land of opportunity,” and that title certainly holds true when it comes to foreign-based fast-casual brands looking to make their mark. Many global concepts—from Pret A Manger and Giraffas to Maoz Vegetarian and Nando’s—have taken a stab at growth in the U.S. over the last several years, with varying degrees of success.

Two more international concepts recently announced plans to grow in the states: Paris Baguette and Carvera Argentinean Grill.

South Korea–born concept Paris Baguette numbers some 3,300 locations in its home country, 141 stores in China, a handful of stores in Singapore and Vietnam, and two in France. Although the French bakery concept is already gargantuan in size, U.S. chief development officer Larry Sidoti thinks its American presence will one day surpass that of other countries.

“We at some point will pass Korea in the number of stores and projected sales,” Sidoti says. “We believe America offers a bigger opportunity because we’re bigger demographically and bigger geographically.”

Paris Baguette already has 45 company-owned stores open in the U.S., mostly concentrated in California and the Northeast. The brand recently launched a franchising program in the U.S., with plans to open 300 new locations by the end of 2020; five stores are already under development, and Sidoti estimates the company will open 21 new units before 2016 is out. Since franchise stores account for 90 percent of all Asian locations, the move could very well make the concept’s ambitious growth plans a reality.

Like any brand, Paris Baguette has its competitors both in the U.S. and overseas, but Sidoti points out that French bakeries are not especially common.

“Unlike other categories, it’s not oversaturated, and there’s room to grow,” Sidoti says. “We’ve got all the pieces in place to be able to capture a large share of the market, and possibly even the greatest share.”

“It’s easier for us to travel with our brand than for new brands to enter that market because we’ve already got an ultra-competitive landscape regardless of what category you’re in.”

Another brand that plans to leverage its novelty stateside is Carvera Argentinean Grill. Since 1994, Jorge Rodriguez-Lockwood’s family—namely his Argentinean father and Puerto Rican mother—has operated fast casual La Parilla Argentina (“The Argentinean Grill”) in Puerto Rico. When it first opened, Rodriguez-Lockwood says, the restaurant was the first to offer grilled-to-order churascos (grilled meats) in a mall food court.

Now the family is hoping to expand the brand with a new name in the U.S. Rodriguez-Lockwood attended college in the U.S. and saw an opportunity to grow the brand, especially given Puerto Rico’s economic woes as of late. Because the translation of “La Parilla Argentina” is more of a descriptor than a unique name, Rodriguez-Lockwood says, the new moniker protects the brand on a legal level while also removing a language barrier for non-Spanish speakers.

“We wanted to appeal to a broader customer base, not only Hispanics. We thought our name was very hard to pronounce—very long and in Spanish—so I thought that was going to be hard to attract diverse customers,” Rodriguez-Lockwood says.

Since opening the first location in the Florida Mall in Orlando in February, Carvera has already received franchising and investor inquiries. “We’re keeping an open mind for the next couple of months for what we’re going to do,” he says. “[We’ll] probably open a couple more corporate restaurants and either start franchising or do a round of investments to open more stores.”

It helps, too, that Carvera has a familiar face in the Florida Mall. El Mesón Sandwiches, another Puerto Rican concept, opened its first stateside location in Orlando last year to critical acclaim, and Rodriguez-Lockwood says his family knows the owners. Serving premium sandwiches with Caribbean flair, El Mesón’s Florida Mall location was attracting the longest lines in the food court, and since then it has opened another location in nearby Kissimmee, Florida. (Read more about El Mesón here.)

The quality of the food, the dining experience, and the restaurant ambiance could also help immigrating concepts like Carvera and Paris Baguette find a strong foothold.

Paris Baguette’s pastries are an aesthetic treat, and the brand uses its own proprietary dough (created in three massive support centers within the U.S.) to ensure consistent quality.

“The concept itself is French inspired. Even though it is a Korean company, the processes and the product itself remind you of a French bakery,” Sidoti says. “It’s a very high-quality product, and the ambiance and the environment give you that romance and feel, as if you’re in a French bakery.”

Similarly, Carvera has created a sensory experience to complement the food. A brick wall hand-painted by a Puerto Rican artist features Carlos Gardel, the quintessential Tango singer whose likeness is ubiquitous in Argentina and neighboring Uruguay. The location also features an open shelf with a collection of antique items. Since most of the menu—everything from grilled entrée combos to build-your-own “Tango plates”—is made to order, guests are part of the experience.

“Everything is made from scratch in the store; everything is made to order in an open grill so customers can see the actual churasco being cooked there. It is served in around 10 minutes,” Rodriguez-Lockwood says.

The longer wait time, along with the average bill—$6.99 for salads to $10.99 for grilled meats—are in line with fast-casual competitors even though the Argentinean fare is decidedly new in a market that often equates all Latin American cuisine with Mexican.

While both Carvera and Paris Baguette are hoping to mine in unsaturated categories, Sidoti acknowledges that thriving in America can be tricky.

“I think it’s easier for American brands [to go overseas] because American brands are so well received outside the U.S. It’s easier for us to travel with our brand than for new brands to enter that market, because we’ve already got an ultra-competitive landscape regardless of what category you’re in,” Sidoti says. “You’ve got to be very good to be able to last in that space.”

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