A MISSION TO REINVENT FAST FOOD
Mexican chain Guzman y Gomez is striding into the future
How Mexican fast food chain Guzman y Gomez is striding into the future.
There are a lot of exciting developments happening with fast food franchise Guzman Y Gomez which recently announced that it will be selling a stake of the business.
Mark Hawthorne, GYG CEO, says “Guzman y Gomez is currently going through the process of raising capital in excess of $25m to expand our growth into international and domestic markets and to support our innovation plans in digital and technology. We are in the early stages of discussions but look forward to sharing our growth plans in the future.”
This stalwart of the Mexican eats scene is all about reinventing fast food, making it ‘vibey’, friendly, affordable, cheap but also good quality. This may seem difficult to some but to Hawthorne this is what gives him his drive.
Hawthorne has been in the fast food industry for more than 20 years and has enjoyed time at the helm of both UK and NZ McDonald’s.
He’s been a passionate advocate, and consumer, of each brand.
“When I was the GM of McDonald’s I ate the food five times a week but I had to do a lot of exercise. I now eat GYG five times a week but I don’t have to exercise as much,” he says.
Hawthorne was initially hesitant to take on the GYG CEO role as he had been in the fast food industry for about 27 years. But he had never before seen a fast food brand serve food so quickly while maintaining good quality. And so tempted by the “amazing quality” of food, and encouraged by his wife, the fast food veteran simply couldn’t turn down the opportunity.
ADVANCING THE BRAND
GYG has been improving the offer to customers through menu updates and fresh ways of reaching fans of the brand - think new size orders, new fries, more drive throughs, burrito delivering drones.
The fast food chain rolled out a
new menu strategy which started around nine months ago with the implementation of ‘real potato fries’.
While it may not seem like a big innovation to have 100 per cent real potato fries, Hawthorne says many fast food restaurants use chemicals and the fries are not pure potato.
“If we want to reinvent fast food we have to make sure that our food is always top quality while remaining quick and keeping our Mexican feel,” he says.
The skin is left on the potatoes to keep all the nutrients. There are a lot of Mexican sauces to choose from like chipotle mayo and jalapeno tomato sauce.
As part of the menu revamp, the fast food chain also incorporated a ‘mini’ range in order to appeal to a wider demographic.
While some franchisees may have initially been worried about this new move, it actually proved to be a huge financial success.
“Because we have the fries as well, we are actually getting more transactions and more often,” says Hawthorne.
The mini range includes burritos, enchiladas, nachos, burrito bowls, fries and salads.
The team plans to be aggressive with expansion and open 25 stores a year with most of these franchised including 15 drive throughs.
Hawthorne points out the new changes and the growth these bring to the brand equate to endless possibilities for franchisees. In fact, some of the best ideas have come from franchisees.
“One of our franchisees in Queensland opened the first drive-through and we were a little nervous about this but it has been such a success and shows us we really can reinvent fast food,” he says.
When you look at GYG you see this fabulous brand and culture and energy and we are very protective at making sure that doesn’t change.
LEADING FROM THE FRONT
The fast food chain has also announced a partnership with UberEATS which means franchisees will have more access to those who want fresh Mexican food delivered to their door.
It is a challenge to ensure the delivery market remains profitable for the franchisees, Hawthorne says, but the brand is committed to the process; he believes there is huge growth in that space.
If the food and delivery is top quality then guests will be satisfied and that makes franchisees very happy, he says.
GYG helps franchisees set up the supply chain, point of sale configuration and IT systems. Once they’re ready to go, a coach will check in to make sure the franchisees are receiving the strategic advice and guidance they need.
Hawthorne is passionate about innovation and technology. When Project Wing (run by a business related to Google) approached the Mexican brand last year about using drones for delivery, there was no hesitation on the CEO’s part: with a mission to reinvent fast food, using ‘revolutionary’ technology was very much on brand.
Eligible customers purchase GYG goods from a Project Wing application on their smartphones, which are fulfilled from a mobile kitchen and warehouse in the surrounding area. Drones deliver directly into the backyards or doorsteps of customers, up to 10 kilometres away from pick-up points.
The commercial trials have been approved by the Civil Aviation and Safety Authority (CASA).
Hawthorne says the drone delivery in Royalla, outside Canberra, is going really well and has received a very positive reception. There are hopes this service will expand across Australia.
The business is focused on growth. The fast food chain has 100 restaurants including those in Singapore and Japan.
Just a few months ago the chain opened its flagship store in Adelaide, the first South Australian outlet in the network.
It was the first restaurant to launch with the total menu offering including breakfast, coffee, the Minis range and fries, and provides customers with cutlery, plates and table service.
FRANCHISEE TRUST
Hawthorne believes his expertise in supply chain and franchising has helped him be successful in his current role.
“When you look at GYG you see this fabulous brand and culture and energy and we are very protective at making sure that doesn’t change,” he says.
“At the heart of a successful [franchisor/ franchisee relationship] you really have to have a brand strong enough to grow business and drive growth.
“You need to have a business model that will lead to a strong financial outcome for franchisees. If you don’t have that then that is where issues come about.”
GYG is also very careful with the talent it chooses. Franchisees become a part of the business’ family and need to be vibrant, passionate and share a love for quality, authentic and great tasting food.
“[The franchisees] really are the face of the brand and the ones there keeping our customers happy,” says Hawthorne.
The business is committed to complete transparency and holds conferences, webinars and has regular round table events for franchisees.
“You have to be very thoughtful with how you engage with a franchisee. We need to make sure we are having two-way conversations.
“We want our current franchisees to be able to be proud of the franchise and speak greatly of their relationship with their franchisor so that new franchisees feel a trust in our brand,” says Hawthorne.
“It is why it is so important to have that positive and open relationship.
“Ensuring there is a model strong enough that our franchisees can do really well is very important. They need to be strong financially - you need to make sure they are always capable of doing that,” says Hawthorne.