CSN EXCLUSIVE: Del Taco Targets the C-store Channel for Growth

The company's "aggressive" plans for growth come on the heels of fiscal year 2023 in which it signed more than 130 commitments for new Del Taco units and planned new market entries into Montana, Wyoming and North Carolina. 

To facilitate this overall growth, Del Taco relies on its New Market Playbook, a comprehensive development, construction, operations, supply chain and marketing guide to opening new locations in new markets — something that aids both traditional and c-store/travel plaza locations. Key considerations of the playbook include a preopening hiring and training program that helps franchisees find their initial staff, plus a targeted digital advertising campaign to introduce the Del Taco brand to the market. To effectively manage the initial peak demand of the grand-opening phase, it strategically staggers turning on the digital channel for third-party and mobile app orders.

"Growing digital is a key initiative, and we have found that this enables the team to gain proficiency while simultaneously maximizing drive-thru and inside dining room efficiency during these formative weeks. It also provides an additional bump in sales once we turn on our digital ordering," Ingram explained. "The playbook is designed to provide a detailed new market entry plan that can be replicated across the country."

Bringing New Options to the Table

As Del Taco grows within the c-store channel, it offers something new to retailers that want to launch a brand partnership that stands apart from much of the competition, Ingram pointed out.

"Our key deliverable is we are an alternative to the standard sandwich, pizza and roller grill options that are typically available in the travel plaza channel. Our unique menu with both tacos and a burger provides variety to travelers," he said.

Selections such as Del Taco's fresh-made guacamole, house-grated cheddar cheese and slow-cooked, made-from-scratch beans are designed to provide customers with a higher quality "Better Mex" option.

"Serving freshly prepared food at an unbeatable value has helped us grow into the second-largest brand in the Mexican QSR category by units," Ingram added. "For the travel plaza category, we offer available white space and development opportunities across much of the United States."

For franchisees, benefits include Del Taco's strong support system, comprehensive training program, recipes, buying powers, distribution and marketing, as well as the comfort provided by a known, familiar brand — something Ingram says customers still prefer.

"Franchising is about replicating a customer service experience across a large geography. At Del Taco, we have an incredibly loyal fan base and strong presence with more than 590 locations in over 15 states," he cited. 

A tricky aspect to Del Taco's growth in the c-store channel is its space requirements, which trend above those of most branded partners. It requires a space that allows the full menu to be offered with drive-thru service, as "express" reduced menu offerings have proven to be unsuccessful in most cases. Accordingly, franchise locations must have at least 1,300 square feet and drive-thru access.

"This is our standard kitchen that allows us to serve our full menu. The express concepts are frustrating for customers if the newly advertised product is unavailable because the kitchen cannot accommodate the LTO [limited-time offer] or menu extension," Ingram said. "We want our customers to be able to order all of our products in every unit. Our only exception is in captive audience-type outlets such as airports."

For retailers that do have the space requirements, Del Taco may offer the necessary balance between freshness and speed of service that consumers want.

"Convenience, speed, accuracy and value are what today's customer requires. We have designed our kitchens and continue to offer food that meets these requirements," Ingram said. "As a brand, we have proven our ability to provide fresh food in a quick-service setting for more than 60 years. From the kitchen layout to the equipment package, everything is targeted toward these factors."