A taste oF Mexico

When Ma. Elenita Tolentino-Adriano finally decided to quit her successful law practice in favor of her own business, she decided to go Mexican.

"My reasoning was simple. If Mexican food is the fourth largest food business in the United States, then it will also click in the Philippines," said Tolentino-Adriano, president of La Salsa, Inc.

The company started out as a Mexican restaurant in 1997. Two years later, best-selling items in the menu were sold in a cart carrying the Tacomio brand inside a mall. The total investment for the cart was P35,000.

Today, the company has 11 carts, six of them company-owned.

"Our first franchised store was located in an art shop in Manila, which also had a pizza outlet. Our products were selling faster than pizza. When the art shop owner relocated to Cavite, she applied for a Tacomio franchise," said Tolentino-Adriano.

Package

The investment package for a cart is P400,000, broken down as follows: a franchise fee of P100,000; equipment worth P150,000; a training package of P100,000; and a P50,000 refundable deposit. The deposit, which would be returned should the franchisee decide not to renew at the end of the five-year franchise agreement, is surety for any of the franchisee’s outstanding materials and inventory obligations.

A cart carries 30 to 40 items and is manned by two people per shift. Given that most malls are open 11 hours daily, that translates to two shifts a day.

A recently launched business model is the kiosk/counter, which carries more products and requires a bigger area for tables. While the franchise fee is the same as that of the cart model, the total investment package for a kiosk/counter is higher at P750,000 because of the P500,000 investment for equipment.

"We have a very conservative expansion program of three to four outlets per year. We are very careful about whom we accept as partners because they will be carrying our trade name, wherever they go," said Tolentino-Adriano.

Competition

Tacomio carts are serviced by a central commissary/kitchen, which delivers fresh stock at least once a week. To help manage costs, the company gives provincial franchisees the option to buy their vegetables and other requirements from within the areas.

Key items such as the sauces are, however, all sourced from the commissary.

"We take pride in our products, which are 100% local and natural. Compared to other fat-laden fast food products, we serve healthy food," said Tolentino-Adriano.

La Salsa’s competition include cart franchise businesses such as Nacho King and Nacho Fast as well as restaurants such as Tia Maria and Mexicali. A new entrant, US-based Taco Bell, is also determined to give smaller Mexican fast food businesses a run for their money.

"Our immediate objective is to increase our presence. We are looking for franchisees in schools, office buildings, and mall, and call centers," said Tolentino-Adriano. –RGDelaCruz