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El Pollo Loco

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El Pollo Loco is the name of two independent restaurant chains that are controlled by different companies, El Pollo Loco, Inc. and El Pollo Loco, S.A. de C.V. Both companies specialize in Mexican-style grilled chicken and were founded by Juan Francisco Ochoa. Ochoa established the first El Pollo Loco restaurant in Guasave, Sinaloa, Mexico, in the mid-1970s, and then expanded his chain into the United States in 1980. Ochoa then sold his U.S. restaurants in 1983, which became El Pollo Loco, Inc., while keeping the ones in Mexico, which became El Pollo Loco, S.A. de C.V. Both companies have since occupied non-overlapping global territories, and have offered different fare.

United States

El Pollo Loco, Inc.
El Pollo Loco
Company typePublic
Nasdaq: LOCO
S&P 600 Component
IndustryCasual dining restaurant, Restaurants
Founded
FounderJuan Francisco Ochoa
HeadquartersCosta Mesa, California
Number of locations
430[1]
Area served
United States
(California, Nevada, Arizona, Utah, Texas)
Key people
Steve Sather (President, CEO)

Kay Bogeajis (Chief Operating Officer)
Larry Roberts (Chief Financial Officer)

Ed Valle (Chief Marketing Officer)
ProductsFire-grilled chicken and related Mexican food
Websiteelpolloloco.com

El Pollo Loco, Inc. is a restaurant chain based in the United States, specializing in Mexican-style grilled chicken. Restaurant service consists of: dine-in, take-out, with some locations offering drive through options. The company is headquartered in Costa Mesa, California and operates over 400 (as of March 2014) company-owned and franchised restaurants in the Southwestern United States. "El Pollo Loco" is Spanish for "The Crazy Chicken".

Fare

A typical El Pollo Loco restaurant

El Pollo Loco primarily prepares Mexican chicken entrees. The company describes its chicken as "citrus-marinated and fire-grilled." The American company also offer Mexican-style food such as tacos, burritos, enchiladas, and quesadillas.[2]

In a bid to compete with companies such as KFC and Chick-fil-A, El Pollo Loco experimented with offering deep fried chicken in the form of breaded chicken tenders at selected locations in the United States for a limited time during the Fall 2016.[3][4] This experiment is a big departure from its previous marketing campaigns that tout their fired-grilled chicken as a healthy alternative to fried chicken.

History

Juan Francisco Ochoa started the restaurant in Guasave, Sinaloa, Mexico, in 1975.[5]

By 1979 the chain had expanded throughout northern Mexico. On December 8, 1980, Ochoa opened his first U.S. restaurant in Los Angeles, California at 503 Alvarado Street, near Sixth Street.[6][7] The first American location was only 1,500-square-feet and it grossed more than $125,000 per month during its first year of operation.[8] The initial menu was very simple: a choice of a half or whole chicken with a packet of warm tortillas and a cup of salsa.[8] A second location was opened in Santa Ana in the fall of 1981.[8]

In 1983, the 19 American restaurants in the chain were acquired by Denny's with an agreement that the Ochoa family would continue to operate the restaurants in Mexico.[9] After 18 months of new ownership, the American owned El Loco Pollo, Inc. had increased the number of locations in Southern California from 19 to 29 while adding 6 locations in distant Houston, Texas, with almost all of the new locations were franchise operations.[10]

Four years later the 70-unit El Pollo Loco was acquired by TW Services when TW Services purchased El Pollo Loco's then parent Denny's Inc. in 1987 for $218 million in cash.[11][12]

In May 1990, El Pollo Loco opened its 200th restaurant. That new restaurant was located in Yorba Linda, California.[13] During the early 1990s the company experimented with many different concepts to increase marketshare in the competitive Southern Californian fast food industry. In 1994 the company test marketed at a select few locations: a side-dish bar, salsa bar, and barbecue at some locations, while other locations tried selling french fries or ice cream.[14] Only salsa bars survived the test and were introduced chainwide the following year.[15] The company also tested home delivery and catering in 1995.[15]

In August 1995 El Pollo Loco earned a place in the Guinness Book of World Records for building the world's largest burrito in Anaheim, California. The burrito was 3,112 feet (949 m) long and weighed two tons.[16]

American Securities Capital Partners acquired the 274-location El Pollo Loco in 1999 for $114 Million from Advantica (formerly called TW Services)[17] and later sold it to Trimaran Capital Partners in 2005 for $400 Million with 328 locations.[18][19]

File:Elpolloloco-logo.png
El Pollo Loco 2015 logo

In January 2007, El Pollo Loco was featured on NBC TV's hit show The Apprentice: Los Angeles where contestants competed by creating and selling versions of El Pollo Loco's Pollo Bowl.[20] El Pollo Loco was recognized by the World Franchising Network as a Top Franchise for Hispanics in 2010.[21]

New locations were first open by franchisees in the states of Utah[22] and Oregon[23] in 2008. The 400th location was opened in Chelsea, Massachusetts in May 2008.[24]

In July 2014, El Loco Pollo (Nasdaq: LOCO) became a publicly traded company on NASDAQ.[25][26]

In October 2016, the company announced that it had teamed up with a Louisiana-based franchisee who plans to build and open two units in Lafayette, Louisiana, sometime in 2018.[27] In the following year, the Louisiana-based franchisee announced that construction of the first Lafayette was going to start in the upcoming month with an anticipated opening in the late spring of 2018.[27]

Temporary expansion eastward

Throughout its history, El Pollo Loco, Inc., tried at various times to expand beyond its core territories of California and the American Southwest, but all of these attempts were so far not very successful.

In 1987, then owner TW Services began to open restaurants in the Orlando area, starting in Winter Park, Florida.[28] Five restaurants were eventually built but all five were forced to close in 1991.[29]

A second expansion attempt, mainly though franchises, was started in 2006 under then owner Trimaran Capital Partners.[30][31][32] All of these locations were closed within six years.

During this time, El Pollo Loco or its franchisees briefly operated several restaurants in metro Atlanta,[33] and Boston,[24][34] New Jersey[35] and in the Hampton Roads area of Virginia;[36] these closed by 2011. The chain's franchised restaurants in the Portland, Oregon metropolitan area[23][37] also closed in 2011. An El Pollo Loco in the Foxwoods Resort Casino in Connecticut[38] closed in spring 2012. The last of four Chicago area[39][40][41] stores closed at the end of 2012.

Locations within the United States

In the U.S., the El Pollo Loco chain operates over 400 company-owned and franchised restaurants in Arizona, California, Nevada, Texas, Utah, and coming in 2018 Louisiana.[42][43] In 2012, El Pollo Loco restaurants went through a major makeover.[44]

Locations outside North America

Under Denny's and its successors, El Pollo Loco, Inc., had sold franchise licenses to operators based in East Asia.

In 1987, TW Services made a deal with the major Japanese trading company Mitsui & Co. to open 484 restaurants across Japan, at the same time that Taco Time and Taco Bell were opening their first locations in the country.[45][46] The first of these opened in Tokyo in 1988.[47] All of the Japanese locations were closed by 1994.[48]

By 1997, EPL, Inc., had franchises located in Malaysia, Singapore and the Philippines.[49] The franchise licenses for both Malaysia and Singapore has since lapsed. In July 2016, the Delgado family, owners of the El Pollo Loco franchise in the Philippines, filed a lawsuit against EPL, Inc. in the Regional Trial Court so it could retain the El Pollo Loco trademark in that country after the franchise contract had terminated.[50]

Charity partners

The brand created Fire-Grilled Fundraisers, an initiative for nonprofit organizations to raise funds for their cause while dining at the restaurant. They also created El Pollo Loco Charities, a nonprofit 501(c) charity to provide meals to underprivileged families, in 2005.[51]

Technology

In June, 2017, El Pollo Loco launched their rewards program, Loco Rewards. The all-new Loco Rewards loyalty program, developed by Punchh, is available through El Pollo Loco’s mobile app. The rewards program allows customers to earn points for their spend at the restaurant and earn rewards. [52] [53]

Mexico

El Pollo Loco, S.A. de C.V.
El Pollo Loco
Company typePrivate
IndustryCasual dining restaurant, Restaurants
FoundedGuasave, Sinaloa, Mexico January 6, 1975; 49 years ago (1975-01-06)
FounderJuan Francisco Ochoa
HeadquartersSan Pedro Garza García, Nuevo León,
Mexico
Number of locations
52 (October 2017)[54]
Area served
Mexico
(Coahuila, Michoacán, Nuevo León, Sinaloa, Tamaulipas, and Mexico D.F.)
ProductsFire-grilled chicken and related Mexican food
Websiteelpolloloco.com.mx

The El Pollo Loco locations in Mexico are not affiliated with or operated by the Costa Mesa, California-based El Pollo Loco, Inc. but are operated by Mexico-based El Pollo Loco, S.A. de C.V., which is still owned by founder Juan Francisco Ochoa and his family.[55] The company specializes in selling Sinaloa-style marinated grilled chicken.

In Mexico, El Pollo Loco, S.A. de C.V., operates as El Pollo Loco in over 50 locations within Mexico City and the states of Coahuila, Nuevo León, Michoacán, Sinaloa, and Tamaulipas, of which 28 of those being located in Nuevo León.[54]

History of the Mexican chain

Ochoa opened his first location in Guasave in the state of Sinaloa on January 6, 1974 at a small roadside location containing ten tables and with a starting working capital of 15 thousand pesos. His wife Flérida created a fruit-based marinade which was used to coat the chicken for several hours prior to grilling. After a few hours of operations on their first day, they sold out all 43 chickens.[55][56][57]

Three years later, Ochoa's brother Jaime quit his job and opened the company's second location in San Luis Potosi. This was quickly followed by other locations that were opened and operated by Ochoa's other brothers and sisters in Guadalajara, Morelia, Monterrey, and Saltillo.[55]

By the end of 1979, Ochoa had 85 restaurants in 20 cities throughout Northern Mexico with many of the locations operated by family members or close friends.[56] At that time, Ochoa thought about expanding north of the borders into areas of the United States that he had previously visited. In 1980, Ochoa opened his first U.S. location on Alvarado Street in Los Angeles, an area which had a high concentration of immigrants from Sinaloa.[7][55]

The company rapidly expanded on both sides of the international border during the early 1980s. However a number of bad decisions caused by a non-related manager caused the company to accumulate $3 million in debts and created a cash flow problem that forced Ochoa to sell his properties outside Mexico to help cover those debts.[55]

In September 1983, Ochoa sold the 19 U.S. locations, all of which were located in Southern California, to Denny's[9][58] for either $12.6 million[59] or $11.3 million.[10] At the time of the sale, Ochoa had retained 92 locations within Mexico.[9] As part of the agreement, Denny's promised to assist Ochoa in opening new locations in the parts of Mexico that Ochoa's company did not then occupy. In 2004, the Mexican company filed suit in U.S. Federal Court against the American company for failure to fulfill the joint expansion agreement. After three years of litigation, the Court ruled against the American company and ordered the American company to pay $22 million in damages and to return the ownership of the "El Pollo Loco" trademark and intellectual property within Mexico back to the Mexican company.[60][61]

As a result of the debt debacle created during the early 1980s by a non-family manager, the number of locations has since shrunk to approximately 40 locations, all of which are managed and operated by family members.[55]

After the sale of the American locations in 1983, Ochoa restricted his business activities to Mexico. However, the lure of new business activities north of the Rio Grande was too hard to resist and Ochoa opened his new business, called Taco Palenque, in Laredo, Texas in 1987.[62]

Fare

Unlike its American counterpart, the Mexican chain has kept its menu simple and focused on the grilled chicken. Deboned chicken or other meats like shrimp or carne asada are not available. Standard Mexican-American fare such as tacos, burritos, enchiladas, and quesadillas are also not available.[55][63]

Controversies

In January 2016, the Secretaría de Salud de Nuevo León, the Health Ministry for the Mexican state of Nuevo León, closed several franchised locations of El Pollo Loco for several health code violations.[64] At least one of the locations was owned by Mexican politician Marco González who claimed that the closures were politically motivated.[65]

See also

References

  1. ^ "Full List of Locations". El Pollo Loco. Retrieved 23 November 2015.
  2. ^ "Our Food". El Pollo Loco Inc.
  3. ^ Luna, Nancy (September 2, 2016). "El Pollo Loco adds fried chicken tenders as Raising Cane's leads surge in chicken sales". Orange County Register.
  4. ^ "El Pollo Loco Introduces New Chicken Tenders". Brand Eating. September 5, 2016.
  5. ^ Diaz, Francisco (8 July 2011), "Entrepreneur of the Year is Named", Laredo Sun, archived from the original on 17 July 2013, retrieved 16 July 2013 {{citation}}: Unknown parameter |dead-url= ignored (|url-status= suggested) (help)
  6. ^ "The Legacy of El Pollo Loco". El Pollo Loco. Archived from the original on 2010-11-25. {{cite web}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  7. ^ a b "Saboreando el éxito" [Savouring success]. Revista Clase (in Spanish). June 24, 2015.
  8. ^ a b c Moreland, Pamela (February 12, 1982). "Mexico's Crazy Chicken Is Set to Take on Colonel". Los Angeles Times. p. F1. {{cite news}}: Unknown parameter |subscription= ignored (|url-access= suggested) (help) Alternate Link via ProQuest.
  9. ^ a b c "The Denny's Inc. restaurant chain has reached an agreement..." United Press International. September 19, 1983.
  10. ^ a b Rivera, Nancy (March 10, 1985). "El Pollo Loco Adopts Yuppie Look but Still Maintains Its Latin Flavor". Los Angeles Times.
  11. ^ "TW Services To Get Denny's". The New York Times. July 17, 1987.
  12. ^ Sanchez, Jesus (July 17, 1987). "N.Y. Firm Buys Denny's Chain for $218 Million : Most of Top Management Will Remain With Chain". Los Angeles Times.
  13. ^ "Retail". Los Angeles Times (Orange County ed.). May 3, 1990. p. 5. El Pollo Loco is about to open its 200th store. The "store of significance," as the company calls it, is situated on Yorba Linda Boulevard in Yorba Linda and opens Wednesday. {{cite news}}: Unknown parameter |subscription= ignored (|url-access= suggested) (help) Alternate Link via ProQuest.
  14. ^ Sullivan, J. L. (June 6, 1994). "Becoming a tough bird: El Pollo Loco regroups, steps up marketing effort". Orange County Business Journal. Vol. 17, no. 23. p. 1. A side-dish bar and salsa bar are in test periods at several locations. El Pollo Loco executives are currently testing a barbecue concept, as well as a joint operation with a Fosters Freeze store in Upland, Calif., a project that might lead to the introduction of ice creams chainwide. Also rolling into the chain's locations are french fries, which executives hope will round out their selection and remove a possible objection by customers considering a meal out. Link via ProQuest.
  15. ^ a b Monson, Rani Cher (February 16, 1995). "El Pollo Loco will open more outlets, boost menu, remodel". Orange County Register. p. c.02. The Irvine-based fast-food chain has other plans, too. For starters, $6.6 million will be spent to remodel all 206 El Pollo Loco locations. Changes include an exterior overhaul, installing new lamps and adding salsa bars at every location. The goal is to finish the job systemwide by 1996. Also, the company might expand a recent experiment in catering and home delivery. The company says the services were so popular during the holidays that the idea might go chainwide. All 31 Orange County locations cater, and one Huntington Beach store has home delivery. The menu, once topheavy with chicken, will get several new items, including fish tacos, mashed potatoes and cucumber salad. Six entrees and five side dishes were added last year, helping to boost the company's sales. Link via ProQuest.
  16. ^ Eyerly, Alan (August 1, 1995). "That's a Wrap--Charity Event Is Full of Beans". Los Angeles Times.
  17. ^ Hernandez, Greg (November 10, 1999). "El Pollo Loco Sold for $114 Million". Los Angeles Times.
  18. ^ Vincent, Roger (September 29, 2005). "El Pollo Loco to Be Sold for $400 Million". Los Angeles Times.
  19. ^ Luna, Nancy (September 29, 2005). "El Pollo Loco to be sold". Orange County Register.
  20. ^ "El Pollo Loco is Newest 'Recruit' on NBC's The Apprentice: Los Angeles". Business Wire (Press release). 28 January 2007. Retrieved 10 October 2013.
  21. ^ Bond, Rob (July 6, 2010). "Top 26 Franchises for Hispanics: Poder's annual survey of Hispanic diversity in the franchise business sector in 2010". World Franchising Network.
  22. ^ "El Pollo Loco plans to open 1st Utah restaurant in May". Deseret News. January 24, 2008.
  23. ^ a b Wells, Shannon (15 July 2008). "Restaurant spices up Wood Village Town Center". Portland Tribune.
  24. ^ a b "El Pollo Loco Opens 400th Restaurant in Chelsea, its First Boston Area Location Experienced Multi-Unit Restaurateurs Open Third of at Least 25 New Eng". Multi-Unit Franchisee Magazine. May 27, 2008.
  25. ^ Li, Shan (July 25, 2014). "El Pollo Loco stock sizzles to close at 60% above IPO price". Los Angeles Times.
  26. ^ Luna, Nancy (July 25, 2014). "Wall Street clamors for a taste of chicken: El Pollo Loco stock surges 60 percent on first day of trading". Orange County Register.
  27. ^ a b "Two El Pollo Loco locations planned for Lafayette". Baton Rouge Advocate. October 3, 2016.
  28. ^ Snyder, Jack (July 13, 1987). "Real Estate". Orlando Sentinel. p. 6. {{cite news}}: Unknown parameter |subscription= ignored (|url-access= suggested) (help) Alternate Link via ProQuest.
  29. ^ Strother, Susan G. (October 19, 1991). "El Pollo Loco Closes Orlando Restaurants". Orlando Sentinel.
  30. ^ Hirsch, Jerry (November 28, 2006). "Will East Coast go loco for an expanding El Pollo?: The Mexican chicken chain has ambitious plans to compete nationally but faces a challenge in taco-deprived New England". Los Angeles Times.
  31. ^ "El Pollo Loco Heats up National Expansion with Multiple Franchise Development Agreements: Flame-Grilled Chicken Leader Signs Agreements for 61 New Locations in Five Key States". Business Wire (Press release). November 6, 2006.
  32. ^ "El Pollo Loco plans eastward expansion". L.A. Biz. January 28, 2004.
  33. ^ "El Pollo Loco Leaves Atlanta as Other Chains Make a Comeback". Tomorrow's News Today - Atlanta. October 5, 2011.
  34. ^ "El Pollo Loco in Chelsea Has Closed". Boston Restaurant Talk. January 14, 2010.
  35. ^ Verdon, Joan (May 3, 2012). "Latin-flavor chicken chains haven't migrated to North Jersey in expected numbers". NorthJersey.com.
  36. ^ Shapiro, Carolyn (February 17, 2011). "3 El Pollo Loco restaurants closing". Virginia Pilot.
  37. ^ Gunderson, Laura (April 4, 2009). "Fast-food chains look toward growth in Portland market". The Oregonian.
  38. ^ Giuca, Linda (November 23, 2006). "Take On A Chicken In A Game Of Tic-tac-toe". Hartford Courant.
  39. ^ Fulmer, Melinda (February 4, 2004). "El Pollo Loco to Expand to Chicago Area". Los Angeles Times.
  40. ^ Meyer, Gregory (August 4, 2005). "El Pollo Loco's Hombre in Chicago". Crain's Chicago Business.
  41. ^ "El Pollo Loco pulls back on Chicago expansion". QSR Web. January 21, 2010.
  42. ^ "El Pollo Loco to Enter Louisiana with New Franchise Partner". October 3, 2016.
  43. ^ Wyatt, Megan (August 31, 2017). "Mexican restaurant to open 1st Louisiana location in Lafayette".
  44. ^ Luna, Nancy (November 8, 2012). "El Pollo Loco joins fray of fast food makeovers". Orange County Register. Retrieved 10 October 2013.
  45. ^ Galante, Mary Ann (July 22, 1988). "Taco Bell Hopes Japan Says Si to Mexican Fare". Los Angeles Times. Retrieved September 15, 2018. {{cite web}}: Cite has empty unknown parameter: |dead-url= (help)
  46. ^ "Taco Time chain announces expansion into Japan". May 3, 1987. Retrieved September 15, 2018. {{cite web}}: Cite has empty unknown parameter: |dead-url= (help)
  47. ^ "TW Services expands El Pollo Loco to Japan". UPI Archives. November 17, 1987. Retrieved September 15, 2018. {{cite web}}: Cite has empty unknown parameter: |dead-url= (help)
  48. ^ Martin, Richard (February 14, 1994). "Japan: Opportunities exist despite crowded market". Nation's Restaurant News. Vol. 28, no. 7. p. 4. The pressures have proved too much for some chains that made hopeful debuts in the last five years but recently have bailed out of Japan. Unable to crack the market despite the clout of strong Japanese partners, both the Carl's Jr. and El Pollo Loco chains have thrown in the towel. {{cite news}}: Unknown parameter |subscription= ignored (|url-access= suggested) (help)
  49. ^ O'Dell, John (April 23, 1997). "Marchioli to Head El Pollo Loco". Los Angeles Times.
  50. ^ Agustin, Victor C. (July 8, 2016). "Cocktales: El Pollo Loco breaks away from US parent over trademark issue". InterAksyon.
  51. ^ "El Pollo Loco Seeks to Boost Impact on Community through Non-Profit Charity". Bison Advertising. April 18, 2005.
  52. ^ "El Pollo Loco Launces New Loyalty Rewards Program with Help from Punchh Platform, Olo", "HospitalityTech", June 16, 2017
  53. ^ "El Pollo Loco Hops On Digital Bandwagon With New App, Loyalty Program, And Delivery", "PYMTS.com", June 14, 2017
  54. ^ a b "El Pollo Loco - Sucursales". elpolloloco.com.mx (in Spanish). Retrieved 4 October 2017.
  55. ^ a b c d e f g Cantu, Gustavo (March 9, 2015). "Don Pollo Loco". El Universal (Mexico City) (in Spanish).
  56. ^ a b Manjarrez, Azucena (November 9, 2006). "Sigo soñando: Juan Francisco Ochoa: En 1974, y después de varios fracasos como vendedor, abre en Guasave el primer Pollo Loco, convertido hoy en una de las cadenas más prominentes en México y EU" [I keep dreaming: Juan Francisco Ochoa: In 1974, and after several failures as a seller, opens in Guasave the first Pollo Loco, now become one of the most prominent chains in Mexico and the US.]. Editorial Noroeste (in Spanish).
  57. ^ Festejo, Guasave (January 6, 2015). "Pollo Loco celebra 40 años de vuelo: Francisco Ochoa le dice a quienes tienen la idea de emprender un negocio que no se rindan y se arriesguen a tener muchos tropiezos" [Pollo Loco celebrates 40 years of flight: Francisco Ochoa tells those who have the idea of starting a business that would not stop and take the risk to have many setbacks.]. El Debate (Mexico) (in Spanish).
  58. ^ Yoshihara, Nancy (September 19, 1983). "Denny's to Acquire 19 El Pollo Loco Outlets". Los Angeles Times. p. E1. {{cite news}}: Unknown parameter |subscription= ignored (|url-access= suggested) (help) Alternate Link via ProQuest.
  59. ^ Mendez, Cruz Alberto (November 11, 1993). "Pollo Loco expadirá su mercado mundial" [Pollo Loco expand its global market]. La Opinión (in Spanish). pp. 1E, 4E – via Google News.
  60. ^ "El Pollo Loco loses Mexican rights". Nation's Restaurant News. December 4, 2007. {{cite news}}: Unknown parameter |subscription= ignored (|url-access= suggested) (help)
  61. ^ "$22 Million Verdict Against El Pollo Loco". QSR Magazine. August 1, 2007.
  62. ^ "Pancho Ochoa Sr. A One of a Kind Restaurateur and Creator of Flavorful Food Concepts". Texas Border Business. April 28, 2015.
  63. ^ "Menu". El Pollo Loco, S.A. de C.V.
  64. ^ "Secretaría de Salud revela anomalías en las sucursales de El Pollo Loco: La Secretaría de Salud de Nuevo León emitió un comunicado donde aclara las razones de suspensión de estos restaurantes" [Ministry of Health reveals anomalies in El Pollo Loco branches: The Health Ministry of Nuevo León issued a statement clarifying the reasons for suspension of these restaurants]. Publimetro (in Spanish). January 21, 2016.
  65. ^ "Gobierno suspende negocio del diputado priísta Marco González" [Government suspends business of PRI MP Marco González]. El Horizonte (in Spanish). January 20, 2016.
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