Fuzzy’s Taco Shop is evolving with a new model that brings the fast-casual concept a few steps closer to full-service dining.
The 115-unit chain on Monday is scheduled to open a new unit in the Houston area that will be called Fuzzy’s Tacos and Margs. The unit will feature a refreshed menu and digital innovations. But, perhaps more significantly, the restaurant will offer table service, with “Tacotenders” taking orders and delivering food and drinks.
The move marks a significant step in the ongoing re-envisioning of the Fuzzy’s brand, which was acquired in 2022 by Applebee’s- and IHOP-parent Dine Brands Global.
Fuzzy’s sales declined nearly 15% last year, according to the Technomic Top 500 Restaurant Chain report, along with an 11% decline in unit count. Though Dine Brands is a publicly traded company, it doesn’t break out same-store sales or traffic trends for Fuzzy’s in earnings reports.
But Fuzzy’s President and Chief Marketing Officer Patrick Kirk argues that the fast-casual chain has an opportunity to take advantage of a significant point of differentiation: Most Fuzzy’s units have a full bar.
“Alcohol service in the fast-casual category is not widespread right now,” said Kirk in an interview with Restaurant Business. “So to truly maximize your bar sales and your alcohol sales, you want to have an environment in your restaurants that’s conducive to a lot of energy, a lot of socializing, camaraderie, fun, relaxation. That dictates how your dining room experience and your layout and your model looks.”
But Kirk is not necessarily saying Fuzzy’s is going full on full service.
He sees another sweet spot in the fast casual segment emerging—one he calls “fast-casual plus”— that will further blur the lines between what is considered fast casual and what is full-service casual dining.
“And the reason I think this is evolving is fast-casual concepts, like us, that are realizing the potential for great alcohol sales,” he said.
At most Fuzzy’s, guests order at a counter and pick up their food at a window, and that's also true for fast-casual taco competitors like Velvet Taco and Torchy's. Those competitors also offer margaritas and sangrias.
But most Fuzzy's restaurants have a full bar offering different variations of margaritas, of course, along with other cocktails featuring tequila, rum and vodka, as well as beer and wine.
Other taco concepts offer frozen margaritas, but many use a less premium mixto tequila, said Chef Daniel Camp. Fuzzy’s, on the other hand, uses a 100% blue agave Jose Cuervo Tradicional mixed with triple sec and a house margarita mix.
Beyond margs, Fuzzy’s version of a screwdriver features Sunny D, mango puree and Smirnoff Vanilla Vodka, for example; and a Double Rum Daiquiri features strawberry puree and Captain Morgan Spiced Rum and Bacardi Silver.
“They’re a little more premium than what you would find in traditional frozen beverages, but for us, it’s definitely something that’s signature and that we really want to hang our hats on as we continue to expand,” said Camp.
The chain already attributes an average of about 20% of sales to the bar, which is higher than some casual dining brands. Kirk sees that number growing to 25% or more. Some units already top 30%, he said.
Earlier this year, Dine Brands launched a new Happy Hour promotion at Fuzzy’s systemwide with $5 and under options, including a $4 house margarita.
The new table-service format in Houston’s Sugar Land suburb is designed to encourage guests to stay a while, and perhaps order more drinks. With the Tacotenders working the front of the house with hand-held point of sale tablets, guests don’t have to walk to the counter or bar to order more drinks or snacks.
The unit is owned by Nazarian Global Enterprises and operated by brothers Miro and Andrew Nazarian. The franchisees, who also operate IHOPs in the region, have signed on to open three Fuzzy’s by the end of 2025.
The menu has also been upgraded with a focus on three categories. There’s the original line of tacos, which feature less traditional ingredients like feta cheese and garlic aioli, for example. A second category focuses on more traditional Mexican classics. And a third is for more inventive offerings, like a taco drizzled with hot honey.
Fuzzy's new birria taco was introduced as a limited-time offer, but was so popular, it was added to the core menu. | Photo by Lisa Jennings
More innovation is coming to the menu, but Fuzzy’s will continue to offer all-day breakfast tacos, and guacamole is made in house.
Fuzzy’s is still “incubating,” said Kirk. But the brand is positioning to appeal to consumers who want the convenience, efficiency and speed of fast casual, but who are also looking for more of an in-house dining experience.
Camp added that consumers today don’t just want to come in, spend their money and leave.
“The economy is not great for everyone, and so they’re really paying for an experience,” he said.
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