Collins Foods to open 50 Taco Bell restaurants in Australia

Australia’s insatiable appetite for tacos and nachos has prompted fast food retailer Collins Foods to accelerate the rollout of Taco Bell restaurants.
After opening its first Taco Bell in Annerley, Queensland, last November, Collins Foods has signed a development agreement with Taco Bell’s owner Yum! Brands under which it will open more than 50 new Taco Bell restaurants across multiple states between January 2019 and December 2021.

The development agreement covers three Australian states including Queensland, specifies an annual number of new restaurants and provides Collins Foods, Australia’s largest KFC franchisee, with right of first offer to establish new Taco Bell restaurants across the relevant states.

Collins Foods chief executive Graham Maxwell said on Thursday the first Taco Bell store in Annerley was performing strongly and the company planned to open a further three restaurants in Robina, Cleveland and North Lakes before the end of calendar 2018.

The roll-out will be funded from internal cash flows.

Third attempt at Australian success

It’s a case of third-time lucky in Australia for the Taco Bell brand, which started in California in 1962 and sells Tex-Mex foods such as tacos, nachos, burritos and quesadillas.

Taco Bell arrived in Australia in 1981, opening two stores under the Taco Amigo brand, as rights to the Taco Bell name were immediately available. But sales were weak and Taco Bell quit Australia in 1987.
Taco Bell returned in 1998, relaunched by Yum! Brands, which owns KFC and Pizza Hut, but after three years only four stores had opened and the rollout was put on hold because research showed many people did not like the food. Taco Bell left Australia for a second time in 2005.

Since then, Australians have developed a taste for Tex-Mex, leading to strong growth for locally-grown chains Guzman y Gomez and Mad Mex.

In August, Sydney-based private investment firm TDM Growth Partners outlaid $44 million for an undisclosed stake in Guzman y Gomez, helping Australia’s fastest growing food chain expand into more overseas markets.

Guzman y Gomez has about 120 restaurants and drive-through outlets across Australia, Singapore and Japan, and makes more than $200 million a year in sales, growing at about 30 per cent. Eighty per cent of its existing stores are franchised.
Last month Singapore fast food chain 4Fingers took a 50 per cent stake in Mad Mex, which was founded about ten years ago and has 70 restaurants in Australia and New Zealand. 4Fingers plans to roll out the Mad Mex brand in south-east Asia.

Taco Bell has more than 7000 restaurants worldwide and serves more than two billion customers a year. More than 80 per cent of its stores are operated by franchisees.