Sonoma company makes big investment in Taco Bell
A Sonoma investment firm announced a deal Thursday to purchase an additional 13 Taco Bell restaurants in the region, making it the fast-food chain’s largest franchise owner in California and one of the larger ones in the nation.
Golden Gate Bell Restaurant Holdings bought the restaurants, mostly in Sonoma and Napa counties, from Dallas-based Aksan United Fortune for an undisclosed price.
Golden Gate is an affiliate of A&C Ventures Inc., a commercial investment firm that owns 170 properties in 30 states with a value of more than $700 million. The deal follows its purchase of 72 Taco Bells in the Bay Area last month from Dolan Foster Enterprises, which also brought over much of the latter’s management team.
“It’s just such an exciting brand with what they are doing with their menu, store design and social media efforts,” said John Hoffman, who works in business development for A&C Ventures. “What they are doing really resonates with their customer base, typically teenagers up to those 30 and 40 years old.”
The purchase comes as the fast-food industry is under pressure from an increasingly competitive marketplace, critics who advocate more healthier menu options and a labor-inspired drive to raise workers’ wages, said Wayne P. Jones, the executive-in-residence for the University of Louisville’s marketing department.
“It’s not a great (business) environment, but it’s OK,” Jones said.
Taco Bell is a subsidiary of Louisville, Ky.-based Yum! Brands Inc., which also owns KFC and Pizza Hut, and has been a top performer amid uneven results for the overall company.
Same-store sales at Taco Bell increased by 3 percent during the last quarter, with much coming through its recently introduced breakfast menu, CEO David Novak noted during an Oct. 8 earnings call. The company plans to open 200 new stores this year, with 80 percent franchised, Chief Financial Officer Pat Grismer said.
Another strong point for the purchase is that Taco Bell values its relationship with its franchisees, Hoffman said, especially in allowing them to test new products. “There is a lot of give and take,” Hoffman said. “They love to hear from their franchisees about their customers.”
The fast-food industry has been under pressure to make healthier dining options, including from first lady Michelle Obama. Taco Bell this summer revised its Cantina Power menu for bowls ?and burritos, which competes with ?Chipotle Mexican Grill, bulking up on more protein while reducing its calorie count.
“There will be a focus on healthier menu options,” Hoffman said. “That’s not to say there aren’t already good choices .?.?. but I see a lot of improvement in that area.”
In addition, unions are trying to organize fast-food workers and seeking a $15-an-hour “living wage.” Locally, the labor-backed East Bay Organizing Committee helped spur a Sept. 4 Oakland protest by fast-food workers.
One committee member, Veronica Gonzalez, 42, said she has worked at Taco Bell for four years and still makes $9 an hour.
“It’s not a demand focused on any one company or region, but on the entire billion-dollar industry. Nine dollars an hour is not enough for our families to put food on the table and have a roof over our heads,” Gonzalez said in an email.
Hoffman said his company was aware of the labor issue, but that it did not dissuade A&C Ventures from making the investment.
You can reach Staff Writer Bill Swindell at 521-5223 or firstname.lastname@example.org. On Twitter @BillSwindell.
Business, Beer and Wine, The Press Democrat
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