Fiesta Restaurant Group makes gains with its renewal plan

But traffic at Pollo Tropical and Taco Cabana continues to tumble.

In the midst of a turnaround plan for its Pollo Tropical and Taco Cabana brands, Fiesta Restaurant Group is finally seeing some traction in same-store sales growth. But traffic continues to decline as the brands struggle to lure more customers, according to Fiesta’s second quarter earnings.

Same-store sales climbed 3.4% for Pollo Tropical and 3.1% for Taco Cabana for the quarter ended July 1. Total transactions, meanwhile, dropped 1% for Pollo Tropical and a whopping 7.1% for Taco Cabana.

Fiesta stock was down about 6% midday Tuesday on the earnings news.

Company executives blame the decline in traffic on a move away from value pricing and other discounts. They’re mulling a variety of ways to boost traffic, including:

  • Increasing promotion of and adding items to the crispy chicken platform at Pollo Tropical, a range that currently makes up 15% to 20% of all purchases.
  • Using targeted social media.
  • Upgrading POS tablets to securely accept credit cards to increase speed of service.
  • Testing kiosk-based ordering.
  • Piloting a new loyalty program.
  • Beefing up the catering program for the holiday season by hiring new catering managers.
  • Planning to begin third-party delivery later this year.
  • Improving employee training.

Fiesta plans to focus on increasing sales opportunities at existing stores, rather than opening new company-owned or franchised units, Richard Stockinger, company CEO and president, said during a conference call with analysts this week.

“We’re not ready to go full-blown on franchising,” Stockinger said.

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.


Exclusive Content


Restaurants bring the industry's concerns to Congress

Neary 600 operators made their case to lawmakers as part of the National Restaurant Association’s Public Affairs Conference.


Podcast transcript: Virtual Dining Brands co-founder Robbie Earl

A Deeper Dive: What is the future of digital-only concepts? Earl discusses their work to ensure quality and why focusing on restaurant delivery works.


In the fast-casual sector, Chipotle laps Panera Bread

The Bottom Line: The two fast-casual restaurant pioneers have diverged over the past five years, as the burrito chain has thrived while Panera hit a wall. Here's why.


More from our partners