Taco Bell operations

[storewanderer]

This is where I really get frustrated. Seattle franchisee has outrageous pricing due to $15/hour wage law.

Okay- fine. I understand you need a slight price adjustment to pay $15/hr instead of $10/hr.

But to charge 13.99 for a 3pc Tender Combo that costs 6.99 in some lower labor cost state, I am sorry, but there is no way the higher labor rate justifies that kind of a cost difference. You are getting more than the difference in labor cost from the added revenue on a single combo meal. Oh sure your other overhead costs are all higher too, yes, okay, I get it, but you should be selling dozens/hundreds of meals an hour (well, maybe you won't be selling many if you want 13.99 for a 3pc Tender Combo).

These franchisors need to do something about franchisees who price like this. Yet I am suspicious the franchisors actually support this since they get royalties as a percent of sales and if franchisees can push this kind of pricing it really helps royalties. Until customers quit coming...

It wasn't long ago that 3pc Tender Combo was one of their $5 fill up items- it has been maybe 4 years.

[Romr123]

My direct knowledge is pretty dated (from my experience at KFC headquarters 30+ years ago), but there really is very little that the company can do to require a franchisee to alter pricing (other than the mandatory payments into the local advertising co-op funds). With the added intelligence of the HQ knowing (through control of the POS system) exactly how performance is day-by-day, they have general knowledge, but any local zone management/coaching has zero knowledge about price sensitivity (they rise to the top strictly through operations control and expense control). It was always quite interesting going into a KFC restaurant in an affluent part of a city---order sizes were big and premium (expense control for these stores was minimizing waste through promoting leg/thigh sales)

An example is the KFC in Mackinaw City, MI (nearly at the ferry dock to Mackinac Island). They are in-line in the downtown area (parking in front) and are only a 9-month (tourist season) store (close entirely at the off-season). Pricing is sky-high (have only been there once), but it's a tourist area.

Also, Dairy Queen would love to get out of 9-month ice cream stands and into 12-month restaurants, but their old-time franchisees (who have been around up to 70 years) won't go for that---they know their market and capabilities. There are lots of those around the upper Midwest.

Multiple levels of any fast food (or retail, TBH) organization are equipped for nothing more than cookie-cutter rote repetition of a playbook (the Confidential Operations Manual back in those days). There are some fun YouTube videos of 1980s Pizza Hut training which bears this out.

[storewanderer]

My direct knowledge is pretty dated (from my experience at KFC headquarters 30+ years ago), but there really is very little that the company can do to require a franchisee to alter pricing (other than the mandatory payments into the local advertising co-op funds). With the added intelligence of the HQ knowing (through control of the POS system) exactly how performance is day-by-day, they have general knowledge, but any local zone management/coaching has zero knowledge about price sensitivity (they rise to the top strictly through operations control and expense control). It was always quite interesting going into a KFC restaurant in an affluent part of a city---order sizes were big and premium (expense control for these stores was minimizing waste through promoting leg/thigh sales)

An example is the KFC in Mackinaw City, MI (nearly at the ferry dock to Mackinac Island). They are in-line in the downtown area (parking in front) and are only a 9-month (tourist season) store (close entirely at the off-season). Pricing is sky-high (have only been there once), but it's a tourist area.

Also, Dairy Queen would love to get out of 9-month ice cream stands and into 12-month restaurants, but their old-time franchisees (who have been around up to 70 years) won't go for that---they know their market and capabilities. There are lots of those around the upper Midwest.

Multiple levels of any fast food (or retail, TBH) organization are equipped for nothing more than cookie-cutter rote repetition of a playbook (the Confidential Operations Manual back in those days). There are some fun YouTube videos of 1980s Pizza Hut training which bears this out.

There have been a lot of lawsuits over franchisee pricing and most chains have stopped their old required pricing/minimum-maximum pricing/other practices. Lately the best chains can do is force participation in promotions but some franchisees even sue over that. Chickfila seems to require its operators to use certain price models so all locations in a given area have uniform pricing (there may be exceptions for mall/downtown stores). Steak N Shake also still pushes required pricing but there have been a lot of lawsuits and some of the most distant locations like those last 2 in CA have higher prices. The Reno ones had the same pricing as various others elsewhere when they closed (they used to be higher like CA but upon closing they had a price scale identical to a corporate unit in downtown Indianapolis, and some other far flung franchise units on edges).

A couple burger franchisors I am aware of do not allow their corporate field people to even comment on pricing due to that being entirely a franchisee decision and concerns that if a field person comments on why is your Big Mac 6.19 but the unit under different ownership 2 miles away charges 4.99 that a lawsuit may result.

There is one of those 9-month Dairy Queens out in Elko, NV. Old place with separate buildings for hot food and ice cream. There used to be a newer one attached to a casino/truck stop in Primm, NV but it never reopened at all after COVID.

[Romr123]

I can certainly see that (not talking about pricing) being a taboo particularly in an area/region with lots of smaller franchisees.

Funny story from 35 years ago--KFC had corporate stores in Flint, MI except for a single franchise right in the middle of town on Dort Hwy. They actually had a beer license. One time I was shopping the market (there were 7 or 8 corporate stores there as I recall and 3 of them were on Dort (total of 4 with the franchise)--an evening's work) and wasn't paying too much attention to which of the stores on Dort I was entering...lets just say seeing the beer tap got me out of there toute suite! (wasn't getting into trouble with it, just stopping there was wasting time).

[Alpha8472]

The Taco Bell Cantina in San Ramon, California offers alcohol laced slushee drinks, beer, and free video game consoles with big screen TVs. There are sports games on TV too.

The pricing is higher than other nearby Taco Bell restaurants and there is no drive thru. People are flocking to the store and paying outrageous prices. It is all about the decor and the atmosphere. It seems like a fun and trendy place to be seen.

I don't go there often, but it is interesting to see. I find the pricing absurd. However, if you have kids or want to play video games this is the place to be.

Before the remodel, this place was ugly and looked like it had late 90s decor. I placed a drive thru order on the app and when I got there I did not see a drive thru. This place has really increased in business.

[cjd]

I’ve started liking Taco Bell since I can get the $5 combo and modify the chicken burrito to get rid of what I don’t want in it. Wish it tasted more like the chicken and rice burrito did though.

I don’t know what was with Taco Bel last Friday. Usually I can go in and order with at most one person inside.

But this time they were swamped both inside and drive thru. I didn’t bother going in because I knew it would take forever. Even came by later and it was still busy. Gave up on it.

Also they still don’t seem to be offering breakfast despite advertising it.

[Alpha8472]

Taco Bell brought back the crispy chicken tacos. Last time the chicken strips were served in a puffy bread. Now they are in a tortilla. They are pretty good.

Taco Bell keeps bringing back items, and some of them are good.

[storewanderer]

In Reno the Taco Bell franchisee previously CA-based Diversified Foods, now NV-based Diversified Foods, has remodeled two Taco Bell units into a new "urban" design. They wall off the prep area so you can't see much, take more space from the dining area to expand prep areas, make the 3 order kiosks much more prominent, no longer staff the counter (yet the kiosks still cannot print a receipt or accept cash), and put new exterior signs up about "DELIVERY." Another interesting change is they re-configure drive through so there is only space for 3 cars one per spot as described: order point, waiting after order point, and window. Previously there was space for 4 cars in this configuration: one per spot: order point, 2 waiting after order point, one at window.

The first unit remodeled is at 4th and Keystone, about the worst part of town, and this was a small/awkward Taco Bell that is probably 20 years old. Self serve drinks were removed from this location.

The other remodeled unit is at Kietzke/Moana which is a really busy intersection but never struck me as a very busy Taco Bell. This is a good sized 80's Taco Bell building. This location still has self serve drinks (that whole area was relocated too).

So with these remodels it seems Taco Bell is following McDonalds on what I consider to be a lousy initiative of walling off the prep areas so you can't see the prep area. Then we have one site following McDonalds on eliminating self serve drinks which is a terrible idea but they either did it due to the challenging neighborhood or due to space constraints, and another site that kept the self serve drinks.

[Alpha8472]

The Taco Bell drive thru is awful. They made me exit the drive thru and park on the street in front to wait for my order. They can't handle the volume. One slow order will back up the line. The line was so long just to order and it wasn't moving for a long time.

[cjd]

Taco Bell has also brought back the $5 Cravings Box. Usually I get the $5 combo but I will try this next time.

Note that you can substitute nachos and cheese for the cinnamon twists for 49 cents. I wish they’d offer Doritos again.