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After acquiring the company in 2011, Phil Friedman is stepping forward into a new active role as chief executive officer of Salsarita’s Fresh Cantina to begin the company’s major expansion efforts for 2014. Friedman, who was behind the planning and execution of growth at McAlister’s Deli and Panda Express, among other national brands, will use his decades of experience in the industry to help turn Salsarita’s into a household name.
“This was the right time for me to take a more active role,” Friedman says. “Salsarita’s is still a small business, which puts us in an excellent position to refine our strengths and jettison our weaknesses. After great takeover success, we were trying to do too much too fast; the goal now is to do less overall, but to do it better. I see great potential in this concept and look forward to implementing the changes needed for substantial growth in 2014.”
Friedman became known throughout the franchising world for his experience and success working with brands that can be improved and grown. He began his restaurant career as a business planning architect for Marriott, PepsiCo, and Chi Chi’s, and then moved to Panda Express when they had only 100–150 restaurants almost exclusively in mall food courts. Friedman encouraged Panda Express to invest in standalone stores and developed a street concept for the brand, with which it has grown to over 1,600 locations throughout the U.S. He went on to acquire McAlister’s Deli, a small chain of only 25 locations in six Southern states, and set about redeveloping their systems, menus and franchising, and business practices. McAlister’s has since grown to over 300 locations throughout the U.S. Before the recession the company was opening over 30 restaurants per year and maintained a pace of 15 new locations each year during the recession.
Friedman acquired Salsarita’s under Salsarita’s Holdings LLC in June 2011 and began the turnaround process in much the same way he approached McAlister’s Deli. First, he worked on the development of a support center organization to motivate current franchisees and attract new ones. He has now completed a design and development for a new prototype for Salsarita’s locations. Restaurants will remain within the standard 2,500 square-foot footprint, but the space will be utilized more efficiently to the benefit of owners and customers alike.
“We are increasing seating and kitchen efficiency while providing more exhibition cooking space, implementing a Z-line system instead of a straight counter for better customer experience, and working out an order-in and takeout section so customers can order food online and pick it up,” Friedman says. “We’re also working on a more sophisticated point-of-service system that will be in every location by the end of 2014.”
The new prototype will be on display first at a company-owned restaurant in Charlotte, North Carolina, and then at the first new prototype franchised restaurant, which will open in Southaven, Mississippi, in mid-2014. Friedman’s second step is to build a development pipeline from company owned operations. Salsarita’s already has plans for two more company-owned locations in the Carolinas, followed by aggressive franchising growth. Plans call for eight to 10 new franchise locations by the end of the year. Growth includes non-traditional locations such as college campuses and airports, where the company has already seen marked success and on continued growth throughout the Mid-Atlantic and Southeast. The company will open its second and third locations in Texas this year and is targeting the state for further expansion.
“We are really looking at 2014 as a kickoff for our development,” Friedman says. “We are working closely with the franchise advisory council, which we believe is very important for the long-term growth of the brand. I will also be working with franchisees who have signed agreements in the last year to get their locations open, as well as pursuing new multi-unit owners. We have a lot of territory available and a lot of opportunity for entrepreneurs interested in the rapidly expanding fast-casual restaurant industry.”
Friedman is confident that this year is the right time for Salsarita’s to pursue such an aggressive growth plan. He sees the fast-casual segment of the food industry continuing to flourish and additional opportunity in the fast-casual Mexican food category, in particular. Much of the continued fast-casual growth, he says, is due to the alternatives it provides to entrepreneurs.
“Costs have become intense in the restaurant industry, especially the cost of transportation, distribution, commodities, and labor. Fast casual continues to grow because it is a model that allows us, as owners, to manage labor costs while still being an experience customers understand and appreciate.”
The team at Salsarita’s spent much of 2013 reevaluating their menu and adjusting it to include the strongest and most popular dishes while developing new ones and improving cooking efficiency.
“We have a broader menu than just burritos,” Friedman says. “Tacos and taco combos are huge, our salads are extremely popular; we provide options that you can’t find at every fast-casual Mexican restaurant.”
Friedman says that 2013 was a hard year for Salsarita’s, but notes that was primarily due to the need for internal evaluation of systems, buildings, and menus and the subsequent effort to refine and redefine them.
“The most important element for success with any concept is to have your fundamentals right,” he says. “Every concept may have different pressure points, but overall if you’ve got great fundamentals in place then you will grow.” He says much of the evaluation process was confined to the second half of the year, and that the prior 18 months saw the company achieve an initial turnaround with excellent franchised average unit growth.
“We are at the beginning of Salsarita’s growth and Salsarita’s story,” Friedman says.