Tortilla has got “a lot of very exciting sites” lined up to open in 2022 and is already building its pipeline for 2023, chief executive Richard Morris has told MCA.
The fast-casual Mexican business, which has recently appointed a new operations director and head of people, now has the senior team in place and well set up to open its target of 45 sites over the course of the next five years.
Pre-pandemic the business carried out research on the number of site opportunities that were available long-term, which suggested that 150 locations in the UK would be a realistic expectation based on its current site requirements, which Morris said hasn’t changed.
“What has happened is that the pandemic has given us real confidence in knowing that we are now able to open locations that are not necessarily high footfall areas because delivery has been so successful for us,” he said.
“Where there are secondary cities, university towns and locations with a high residential population, we are now looking at slightly off-pitch sites, which is great – that really fills the tank even more around where we can go.”
Morris credits its decision to reopen for delivery shortly after lockdown in March 2020 as “a game changer” for the business, because with very few other brands available on delivery platforms at the time, it enabled them to reach a wealth of customers who hadn’t perhaps thought to order from Tortilla before.
“Looking back on it, I think it’s the best decision we made,” he said. “The real compelling story for us was that on 17 May 2021, when everything reopened, our sales didn’t really miss a beat. That is no doubt that drove our like-for-like sales.”
The business, which listed in AIM in October, reported a like-f0r-like (lfl) sales increase of 23.8% for the full year to 2 January 2022, compared to the same period in 2019, in its trading update yesterday.
Keeping to plan
As per its prospectus, Morris said the business will look to open 10 bricks and mortar sites this year, following by eight or nine in subsequent years. It plans to open four or five cloud kitchens per year, and is using some of these as test beds for whether there is the demand for a bricks and mortar site.
“We don’t want to commit to opening more than 10 as that’s quite a lot, but I am very confident we will do that this year.”
While the property market is not as soft as it was a year ago, Morris said there are still some good locations to be picked up. “It is as good a property opportunity as I have known, which is why we IPOd and why we wanted to have the cash to grow.”
Last year saw Tortilla launch a partnership with Merlin, starting with a trial site at Chessington World of Adventures. Following a successful trial, Morris confirmed that Tortilla will now operate there on a permanent basis and he is hopeful of other opportunities arise in Merlin venues.
Its other partner SSP is also proving fruitful, and Morris said he believed that relationship would only going to flourish. “SSP have had a really tough time, but as the travel market eases they are coming to us with more and more opportunities. They have got a lot of sites they want us to take and we are in the fortunate position of being able to pick and choose the ones that are right for us.”
It recently opened a site with them at Skelton Lakes motorway services, with further service station locations something the brand would definitely look at, added Morris.
