Review of the Taco Cabana Franchise Opp and Startup Costs

Are you thinking about entering the QSR niche in your community? Do you have a passion for Mexican cuisine? If you live in the southwest US, primarily in New Mexico, Texas, or Oklahoma, then a Taco Cabana franchise could be the right investment to make. You’ll get a lot of support from an organization that has a strong brand recognition in its operational area. Serving tacos, burritos, and quesadillas, you’ll be providing people with fresh, fast food with good portion sizes for an affordable price.

How good is this investment opportunity? What kind of support will you receive if you become a franchisee? And what are the initial investment costs that you can expect to pay?

Taco Cabana Is Not Currently Offering Franchises

The Fiesta Restaurant Group is in control of the Taco Cabana franchise concept right now and although previous owners allowed for franchising and support is continually provided according to past agreements, this group is not currently offering any new or additional franchise opportunities. The Group, which formed from the ownership of two Burger King franchises, also owns the Pollo Tropical brand, which is offering international franchise opportunities right now.

If you want to get specifically involved with the QSR niche with a Mexican food franchising opportunity, however, there are a few additional options for you to consider. Here are the brands that are currently seeking franchise opportunities both domestically and overseas.

Del Taco

One of the most established names and brands in the Mexican QSR market is this franchise. Started in Barstow, CA in 1964, this is a value brand where many menu offerings are listed for less than $1. It’s also a fusion concept as both Mexican and American foods are served, including burgers, fries, and shakes. All of the menu items can be combined as well, so you can get a burger with nachos or a taco with fries if you prefer.

This opportunity has a franchise fee of $35k. There’s a 5% ongoing royalty and to qualify as a franchisee, you must prove a net worth of at least $1 million per unit. There is also a $500k liquid cash minimum and in return, you’ll receive a 20 year renewable franchise agreement. The typical investment to achieve a grand opening can be as high as $1.6 million.

Chronic Tacos

One of the newest entries into the Mexican QSR market offers opportunities for those with lower income levels. New units are limited to Canada and the American West/Southwest as of right now. The initial franchise fee is $50k and there’s an ongoing royalty of 6%. The provable net worth requirement is only $250k however, and there’s a $100k liquid cash requirement to qualify as a franchisee as well. The benefit of this franchise opportunity is that there are less than 40 locations worldwide right now, which gives you the opportunity to grow a brand identity for your community from scratch. Expect a total investment minimum of $319k.

Taco Bell

One of the most established names in the Mexican QSR industry is seeking new franchisees around the world. With nearly 6,000 total locations and good brand saturation, your $45k franchise fee is going to go a long ways in this investment opportunity. There’s also a 5.5% ongoing royalty to consider, but your franchise agreement is good for 25 years.

You will need to have a verifiable net worth of $1.5 million, of which 50% must be held in liquid form at any given time. The total investment for a new Taco Bell location may be as high as $2.4 million, but there are a number of different location setups that can help to reduce costs for potential franchisees.

Qdoba

Owned by Jack in the Box, Qdoba is one of the exciting entries into the Mexican QSR field because it features fresh ingredients and made-to-order items in a setup that is similar to a Subway sandwich shop. The initial franchise fee is just $30k in this opportunity, but depending on your franchise location you may need to prove a net worth minimum of $2 million. The franchise agreement is good for 10 years and is renewable. Expect a 5% ongoing royalty.

It is also one of the few franchises in this category that does allow absentee ownership. You’ll need to have a liquid cash minimum of $500k available in some markets, but third party financing is available for those who qualify. Training is 4 weeks long at company headquarters and there is extensive ongoing support for this opportunity.

Fuzzy’s Taco Shop

This investment opportunity has only been franchising for about 5 years. It’s a Baja-style of Mexican food in the QSR market and features breakfast dishes, grilled sandwiches, and salads in addition to the traditional items like tacos and burritos. New franchises are available throughout the US and the initial franchise fee is $35k for a 10 year renewable agreement. Ongoing royalties could be as low as 3.5% in this model, but there is a minimum net worth of $500k to qualify. The initial investment into this franchise could be as high as $704k.

The training in this opportunity is extensive, featuring up to 8 weeks of hands-on training at a company-owned store. There’s also 32 hours of training at the organization’s headquarters and additional 5 days of training at the franchisee’s new location as well. It is one of the smaller franchises that is continuing to grow year after year, so there is proof of concept and you’ll have a different menu than most other entries in this QSR niche.

There may not be any Taco Cabana franchise opportunities right now, but there are options in the Mexican QSR niche that could be the right investment to make. Select the best opportunity from the ones above, contact your preferred organization, and then begin the vetting process so that you can achieve the level of success that you desire in the restaurant industry.

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