Editor’s note: This is the first article in an ongoing franchise spotlight series, which highlights restaurant brands that are new to or aggressively expanding via franchising. Is your restaurant starting to franchise? Email us [email protected]
In 2009, neighbors Osiris Hoil and Marc Wallace launched their first District Taco concept as a food cart, offering menu items based on Yucatan recipes shared by Hoil’s mother. Around 10 years ago, business professionals approached the co-founders with franchise proposals, but Hoil and Wallace wanted proof of concept in both suburban and urban markets first, Tina Ganz, VP of franchise development at District Taco, said. The chain has since gained local recognition, and spans 14 locations in the Washington, D.C. metropolitan area with AUVs of $1,729,098.
District Taco formally announced franchising opportunities in August. But it had already quietly started to franchise in November 2021, when it signed its first multi-unit franchise deal with Hicham El Abbassi and Isalmou Boussaa. The pair, who lead DT Nova LLC and operate 11 other fast casual restaurants in the Washington, D.C. metro area, opened the company’s first franchised store in Springfield, Virginia, in August. El Abbassi and Boussaa finalized a second location in McLean, Virginia, with plans to open that location in Q1 2023. A West Springfield, Virginia, location operated by the franchisee will also open at the end of this year, according to a press release emailed to Restaurant Dive.
Development plans: District Taco aims to add 20 to 25 franchises a year for the next five years, Ganz said. The company has units in the Washington, D.C., Virginia and Maryland region, with some corporate locations in the Philadelphia suburbs. But the company would like to expand as far north as New York, as far south as South Carolina and as far west as Tennessee, Ganz said. District Taco is also attracting operator interest from Florida, and will consider markets in the Sunshine State if the conditions are right.
During the pandemic, District Taco developed a smaller store footprint with units that span 2,000 to 2,500 square feet instead of the previous 3,000- to 3,500-square-foot model. The smaller units offer less dining room space and proprietary efficiencies built into the makeline, Ganz said. The company offers robust design and construction guidelines that span roughly 75 pages, she added. District Taco will also provide real estate expertise and site selection support.
Ideal franchisees: The chain is targeting multi-unit franchise operators, potentially with multi-brand experience, that have infrastructure in place to support rapid expansion, Ganz said. District Taco is also interested in working with senior restaurant professionals who don’t have owner or operator experience, but are ready to transition to ownership.
Franchise quick facts
- Minimum investment required: $790,000 to $1.6 million per location
- Minimum liquid cash: $1 million
- Minimum development requirements: Five units in five years (one restaurant per year)
- Franchise fee: $25,000 per unit
- Development fee: $50,000 per unit
- Royalty fee: 6%
- Innovation fund: 2%