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Seeking opinions and experiences with Taco Del Mar
I'm a business reporter with the Seattle Post-Intelligencer daily newspaper, seeking opinions and experiences of franchisees with Taco Del Mar. That company is based in Seattle, so its business practices are of concern to me.
Most valuable to me are franchisees who are willing to let their names be used. Less valuable, but still desirable, are those will share their stories but not allow their names to be used.
I am posting this because I received an anonymous but detailed and angry email from a current franchisee, and I need to substantiate some of this person's claims. Please call or email me at the contacts below. I will maintain your confidentiality to the limits of the law.
The owner of this site knows I am making this post.
Thank you for your assistance.
Dan Richman, Business Reporter, Seattle Post-Intelligencer, 206-448-8032, danrichman@seattlepi.com
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TDM
I feel bad that TDM has had to resort to bankruptcy. But at least they get a chance to "re-structure" I bought in and worked my arse off to suceed. It was alot of work, but I knew going in it would be. I made so many friends and contacts in the community that I would have never had made if I didn't take a chance. Nothing in life is guanteed ... I have since had to claim bankruptcy with the whole disaster. But I get a new chance with sooooo much experience. I could be bitter but I knew it was a risk... It is what it is... I still am in good health and have a great family!!!! and I tried!!! and I am blessed...
Legal Help
If TDM Canada has signed my lease, and they shut down and formed a new corporation under a new name. Are all previous agreements with them nullified?
You are in somewhat of a
You are in somewhat of a conundrum. If they shut down and close the company they would be breaching the lease with the landlord. The lease company they used I would be sure isn't closing down so as long as you pay rent they can't make you do anything.
The guys in Canada since US Taco Del Mar terminated them will probably try and ask you to change your name and go with them or something silly like that. They may threaten that they control your real estate to get you to believe them.
If I were a franchisee in Canada still I would get everyone together and sue both the US and Canada guys because their poor planning has really effected the value of your business and how you can operate!
Suing can be throwing good
Suing can be throwing good money after bad. I think the TDM Board of Directors needs to be held accountable in all of this mess. Several of them have money and could be sued. Then again, you need to have money to do it and decide if it is worth it.
Suing
What is there left to sue? TDM USA is BANKRUPT, TDM Canada is a holding company with no assets. And finally, franchisees can barely stay afloat, let alone higher high powered lawyers to take on a franchisor.
Suing
You guys do not understand the position the Canadian Franchisees are in. The US Taco Del Mar holds the franchise agreements and collects royalties. Another stupid plan they did was allow Taco Del Mar canada MD Group to hold the leases, effectively creating hardship because a franchisee now has a franchise agreement with the US guys but the disgruntled Canadian Taco Del Mar guys have been terminated causing a no win situation and a tug of war between all three groups - Canada TDM, US TDM and the franchiseess.
Suing will maybe win nothing but may provide relief from this cycle so they can take back the leases or terminate the franchise agreement. Right now all that is happening here in Canada is Taco Del Mar will soon be extinct!
The success of the KFC brand
The success of the KFC brand transformation programme is just reward for the efforts of both employees and suppliers in sustaining a 360-degree approach to the 'taste' positioning strategy with food as the 'hero'. The marketing team has instilled a stakeholder-wide dedication to its three golden rules taste, quality and convenience. As a consequence KFC outlets have managed a constant delivery of the brand promise of always delivering great tasting, fresh chicken that keeps customers coming back. 640-802 KFC's first restaurant opened in Auckland in 1971 serving the Colonel's Original Recipe chicken. At the time of opening, it was the first fast food chain in New Zealand. It has since achieved iconic status and now holds a special place in the heart of many New Zealanders. 350-001 The challenge that has faced the team at KFC New Zealand has been how to transform a mature brand (with four years of consecutive same store sales decline) into a relevant, contemporary and growth brand of today. VCP-310 The aim of the transformation programme, which was launched in 2004, was to contemporise and reinvigorate the KFC brand. Whilst remaining true to the essence of the KFC taste positioning, KFC was looking to provide the customer with an appealing and modern brand, and an enhanced and consistent customer experience.
Taco Del Mar Sold
I understand TDM has been sold to a Dunkin Franchise group from the East. What has anyone else heard. Although scary to be ran from the East nothing is worse than what has been happening around Seattle lately!
Sale Has Failed!!
No sale for TDM at this time...Hope for a Hail Mary???
Complete failure in Arizona
The reason is obvious...it was run by fools! TDM was on a roll in AZ for about 12 months then all hell broke loose. The stores started dissappearing off the map, the master franchisor closed his two stores, etc, etc... My partner and I were stuck with a lease of $150,000 that we took over from a previous owner. I'd love to be involved in a class action suit...
If you opened a TDM in
If you opened a TDM in Arizona you're insane. People that close to the border know what decent mexican food should taste like, not that garbage that TDM shovels out. Not trying to be a dick, but you really thought that would be a success when there's an authentic taqueria on every corner?! Of course, I heard that Taco Bell was opening units in Mexico City, so what the hell do I know?
Think carefully before you
Think carefully before you throw good money after bad. Any type of lawsuit would put TDM in bankruptcy. A sale would mean there is nothing to get from TDMFC.
This should be a good thing.
This should be a good thing. TDMFC has done nothing for the franchisees. New money and fresh ideas are always good.
Well it's been over 3 years
Well it's been over 3 years since I deserted my store in the AZ market.
I curse the day I contacted the Md for the area.
Since then I went bankrupt and my wife left...
Now I am trying to begin again at 40.
Thanks for everything...
Well I can understand going
Well I can understand going bankrupt.
But your wife leaving you - has nothing to do with Taco Del Mar. Couples survived living in wars together and they got through. If your wife couldn't handle some financial hardships, that's a mistake you made by picking her.
Yeah many couples have
Yeah many couples have survived the disaster, But you cant deny it can be extremely stressful on a relationship. Its hard to be a happy person when you have to wake up a go open that nightmare of a store. Going bankrupt losing your home and not having enough credit to borrow a library book sucks. Trust me. Especially after working hard for a lifetime to come up with the money to buy a business.
Sacramento Area Closures
Number of TDM Franchises started in greater Sacramento Area = 19
Number of TDM Franchises left standing in the greater Sacramento area = 1
Test for the day boys and girls. What is the failure rate?
Same statistic looks like it is also playing out in Arizona. Does anyone know how many stores were started in Arizona? There is just three left.
Rule #1 in buying a franchise: Never buy a franchise from a company who was founded by Bluto from Animal House.
Rule #2
Rule #2 of buying a Franchise should be: Don't assume that a regional brand has legs.
Taco Del Mar worked in the past in Seattle because of a number of unique factors that couldn't be replicated outside of the Northwest. These factors include:
1) Cheap Real Estate: Rents are about 50% of the going rate in other states
2) Limited Competition: Up until a few years ago, Seattle didn't have much competition in the fast food Mexican market place.
3) Cheap Build outs: Build out in Seattle=$60K Build out in California $250K
4) Proximity to Corporate: The Seattle area had the local support and watchful eye of the corporate headquarters. The areas outside of Seattle were sold to master developers, many of whom never worked in the restaurant area. The master developers didn't know how to pick a real estate location, didn't know how to train franchisees, didn't care about standards and on-going operations, didn't invest in stores themselves, and only cared about selling the franchises and getting the franchisee fee. Many of these developers were new to the territories they sold into (e.g. those Mormon clowns).
Research Bluto's checkered
Research Bluto's checkered past...
I believe around 20 in
I believe around 20 in Arizona.
So what is the problem? What
So what is the problem? What is causing these failures?
In your opinion, aside from the franchisor... I mean as long as they are providing consistent supplies - why can't these businesses stay open?
Does the food taste horrible compared to other mexican outlets? Or is it the price?
Why do customers not come back? Which in turn is why these places are closing?
Members of my family almost
Members of my family almost brought a TDM franchise, and would have except the MD told them that the locations they wanted were already taken. Those locations never materialized, so my family members dodged a bullet on that one! I wish they had though, because they deserve to lose their life savings!
Anyway, to answer your question, the food is not very good. The spanish rice has a weird tangy flavor, and something is wrong with the rice cookers because charred black bits of who-knows-what end up sprinkled through the rice. The prices on the menu, at least in Canada, are exorbitant, basically twice as much as their US counterparts ($8 for a Mondo Burrito), meanwhile the Canadian Dollar is basically on par.
Oh, and lest you think that
Oh, and lest you think that 'weird tangy taste' was a matter of taste, I meant to write 'weird metallic tangy taste'. Another thing is they put cilantro in the salsa, which is a really dumb thing to do because a lot of people, including me, have the genetic component that makes cilantro taste awful. Why alienate a significant portion of your customer base with a ingredient that wouldn't be missed if it weren't included? I am a huge mexican-fast food fan, and we don't have Taco Bell here, but we do have Taco Time, which I love, and the menu is half the price as Taco Del Mar. Taco Time also happens to be a Washington State-based mexi-fast food franchise. Basically I call Taco Del Mar 'yuppy food'. The main difference between yuppy food and fast food is that yuppy food is bland and tasteless, and the vegetables used in yuppy food (in this case, lettuce and tomatoes) are only sliced into large chunks, rather than diced (tomatoes) and shredded (lettuce) which is what you get at a fast-food place. Essentially you pay more at the yuppy-food place for food that hasn't gone though as much preperation and that is supposed to equate to 'healthy' in the minds of the average yuppy. Problem is there are too man yuppy food restaurants and not enough yuppies to eat the food. Blue collar types (ie people with half a clue) want fast food, not yuppy food.
I disagree with you. The food
I disagree with you.
The food does taste good and that's why customers keep coming back. The problem is that this product is not known in Canada and we don't have the martketing dollars to promote it properly. As a result, people are hestitant to try.
You cannot compare Taco Bell / Time to TDM. The food quality is much better at TDM. That is why we don't have .99 cent tacos. If anything Taco Bell has tarnished mexican food all together because of the dog food quality meat they serve.
As for TDM in general, this is a start up franchise. High risks are involved, but there are some stores that do over 9k - 10k per week. That is more than the average Subway franchise. There is potential for this food in Canada anyway. That's what I'm banking on.
the lousy food
Oh come on, if you think TDM is 'good food' then you are severely deluded. A frozen fish stick comprises the flagship 'fish taco'! It's almost as if the restaurant is a deliberate insult to the customer. Only the catatonic and deranged could possibly enjoy this 'food'. My advice to desperate franchisees: hire young girls with big jugs, then at least you will get creeps coming in to sit there and stare at them and you can force them to buy your horrible 'food' in order to do that.
The Taco Del Mar in Redmond, WA.
has excellent food. I have eaten at Taco Del Mar's where the food is lousy. I believe it was in Redding, CA.
Seattle and Canada do not
Seattle and Canada do not have a major player coming in and battling for market share. Chipotle and even Qdoba have a much better product at a similar price. Other markets in the US get killed by the competitors. The food is very average and doesn't have anything that sets it apart from the others. TDM is very limited based on the foot print and the kitchen.
There is more than one
There is more than one problem.
First is food cost. I couldn't consistently keep mine under 35% and still serve the portions my customers expected. You can shrink the food, but you will also shrink your sales. It's one of a number of catch-22s in a business model that just doesn't work. You can also raise your prices, my strategy, but in the medium term you will also lose sales doing so.
TDM wants to buy high and sell low. They want to serve a quality product, but they can't sell that product at a price necessary to make the model work - at least in part because they tried to position themselves as the "Subway of Burritos" You've got to have big volumes to make it go. But you can't get big volumes when you're a hidden away hole in a strip mall.
Finally, no money should be going to marketing funds. Whatever the history of corporate raiding those funds is, aside. The money has been poorly used for at least the last five years. Some franchisees are paying 3+1% to marketing. Might as well throw it out the window. For me, that would have been around $1400 a month, for nothing. If I were still in the system, I'd mutiny on this point.
In my opinion it is the food.
In my opinion it is the food. Seattle is the strong hold for TDM. Wait until the competition hits hard. There are a lot of other better tasting choices out there. The Z's are stuck with microwaves and flash bake ovens.
The food comes in cooked and you just microwave it. Marketing has done little to come up with new products. They just rehash what we already have.
1% Marketing Fund
What happened to the $400,000 that was "borrowed" by TDM from the marketing fund the franchisees pay into????
This money went to sustain corporate operations due to fat and high salaries in the corporate office. They need to get it together quickly before it is too late. It may already be!!
"Borrowed" maybe after being
"Borrowed" maybe after being caught that was the stance but from what I have heard that was not how it went down? I heard it was $500,000. of Coke incentive money taken by James Schmidt not borrowed originally!There has been a lot of
There has been a lot of speculation around kick backs to TDM. Coke is one of them and the meat supplier is another. TDM has denied it - I'm not sure we will ever know...
re: 1% Marketing fund
Did TDM really borrow money from the marketing fund? Were all the zees notified? Is this speculation?
If you read your FDD about the marketing fund I bet you will see the ify words like may or intend when it comes to the marketing fund. Leaving room for the zor to do what they want.
Our FDD says: We will account for the Marketing Fund separately from our other funds and not use the Marketing Fund for our general operating expenses. However, we MAY use the Marketing Fund to pay the reasonable slaries and benefits of personnel who manage and administer the Marketing Fund, the Marketing Fund's other administrative cost, TRAVEL EXPENSES OF PERSONNEL WHILE THEY ARE ON MARKETING FUND BUSINESS, MEETING COSTS, OVERHEAD RELATING TO MARKETING FUND BUSINESS, AND OTHER EXPENSES THAT WE INCUR IN ACTIVITIES REASONABLY RELATED TO ADMISINSTERING OR DIRECTING THE MARKETING FUND AND ITS PROGRAMS, including, without limitation, conducting market research: public relation: preparing advertising, promotion, and marketing materials:
This one paragraph says alot. In other words they can do anything they want. I am sure it is similar in many FDD's. There is many ify words when it comes to the marketing fund. I believe the marketing fund is at their disposal. We saw no advertising for our franchise.
Another good statement is: THE MARKETING FUND IS TO MAXIMIZE RECOGNITION OF THE APPLICABLE MARKS AND PATRONAGE OF XYZ FRANCHISE. ALTHOUGH WE WILL TRY TO USE THE MARKETING FUND TO DEVELOP ADVERTISING AND MARKETING MATERIAL AND PROGRAMS......
key words here is "WE WILL TRY." How many times have you said I will try to do something. Doesn't mean you will do it.
I did notice TDM has a few late night advertising. Their really into surfers with burritos in their hand. I grew up with surfers and I never saw a surfer holding a surf board and a burrito. I can't see the connection with Mexican food.
I have to say the TDM next to the business we had was the best food I ever tasted in a TDM chain. The owner was a wonderful person. They were busy. She had alot experience in the hospitality business. They were there all the time.
This is not speculation. I
This is not speculation. I believe a letter was sent to all Z's. The way it was handled was suspect. TDM came out and said they borrowed the money, then came back and quoted similar language as above. I think the intent was to pay it back, but now it will not be possible.
There are many good, hard working Z's and the same is true for a few at the coprporate office (past and present).
The letter was sent and a
The letter was sent and a promise to repay was made verbally at a couple of co-op meetings by both Kevin Hansen and the new president Larry Destro. Of course if they can't pay office bills and employees, don' t know how they are going to pay back ad fund money.
Kevin Hansen's Departure
I understand Kevin Hansen the current CEO has left Taco Del Mar! He has been with them for many years and I heard he and the board which is really still controlled by James Schmidt from what I have heard didn't see eye to eye. This is a big loss to TDM and lets hear the new spin on this one. This company is a disaster.TDM
Company TDM is in trouble.
They don't know what to do?
Go with Mondo ? TDM ? or Del Mars ?
Not supporting to MD's or franchisees, their mistakes paid by MDs or franchisees.
Looking for wrong ways to make money. Try to remove MD's by terminating them without right reason !
Company should file bankrupty so some one with better managment can improve the brand !
All corporate staff is not doing things right or follow CEO and James blindly !! Should be change.
Bankrupt
I don't think it will be much longer. TDM is a sinking ship - poor food and limited competition in the "home market". Someone needs to clean house and start over. James and crew are not the answer. The only markets that will make are the Northwest markets. That is until the competition hits hard.
Re: Kevin Hansen's Departure
Kevin is gone and James is back. In the office all of the time now. Appointed Mr Destro to his position and the board. James isn't on the board but still in control through his puppeteering. Now that he got rid of Kevin, he can finish the job of destroying the company he built. Too bad for all of us. Hold on franchisees and try to survive.Kevin Hanson's departure
May God have mercy on us all! James is NOT qualified to run that company. I'd have concerns about James even trying to run ONE franchise.He is trying to run one
He is trying to run one franchise, Ballard I think. Saw his name on the "top 10" in growth a couple of weeks ago.
Kevin Hanson's departure
I hope that Kevin does well whereever he chooses to go. If this is not a voluntary departure I think that everyone in the Taco Del Mar world (except those Seattle fat cats) shuld be concerned. Mr. Destro, good luck to you in your new job. But if you start throwing more franchisees and MDs under the bus for James and his cronies on the board of directors we will start sharing more stories on this thread again and it won't be pretty. Watching that franchisee up in Canada have her store burn down and then commit suicide was the worse experience ever. Even though Neal Hollingsworth had poor morals, in my opinion, he was also following orders from James and David. Be the better man and don't let their greed destroy another family. - TTATDM ...and now this site will surely feature a response from one of Taco Del Mar Franchising Corp's hired PR gunsummmm
"Watching that franchisee up in Canada have her store burn down and then commit suicide "
I think you meant "Watching that franchisee up in Canada hire a friend to burn down her store and then commit suicide after she was caught"
The canadian franchisee was devastated
You are not right.The other guest is right
Re: Kevin Hansen's Departure
This company is definately a disaster... They can't hold on to anyone, perhaps its because they can't pay their staff.Re: Re: Kevin Hansen's Departure
Most of the people on the corporate staff (what is left of them) are kept in the dark about any of the dishonesty that goes on at the top. I wouldn't blame all of them, they really do try their hardest to give the franchisees the best opportunity for a profitable store. And no, they cant pay the staff what they deserve. Though I do agree, TDM has lost a very big asset with Kevins departure.Taco Del Mar - Failure Rates
I posted here a few months ago (Brent D. Beal, brent@bpmllc.net, 225-802-7015). I'm trying to get a handle on failure rates outside of Washingston State. I have data for Arizona (I'm doing it by state) in a spreadsheet (33 total stores, 10 still open, a 70% failure rate), but I'm not completely sure of the data (it's from the 2007 UFOC, a list of former franchisees and the tacodelmar.com site). If you think you can contribute, check any of the data, etc. please email me and I'll forward the Excel file. Thanks.Thinking about closing
My sales are pretty bad and I'm not sure how to go about cutting the cord with TDM. What would happen if I just walked away?Do whatever you want with your store
Do whatever you want with your store. Stop paying your marketing fees, source supplies from wherever you want, modify the menu to your liking. The company doesn't have the resources to sue you, and what would they get if they did? If you manage to turn a profit after doing your own restructuring, hide the profit.
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