El Pollo Loco 2016 Annual Report Download - page 7

Our Competitive Strengths
Webelievethatthefollowingstrengthsdifferentiateusfromourcompetitorsandserveasthefoundationforourcontinuedgrowth:
“Loco-ly” Differentiated Restaurant Concept with Broad Appeal .Webelievethatourfood,servedincolorful,bright,andcontemporaryrestaurantenvironments
atreasonableprices,positionsuswelltosatisfytheneedsofalargesegmentoftime-pressuredmainstreamfoodenthusiastswhoseekrealfood,realfast,andat
reasonableprices.Weprovideourcustomerswiththeopportunitytoenjoycitrus-marinatedfire-grilledchickenandMexican-inspiredentreescontainingdistinctive
ingredientssuchasavocados,mangos,andserranopeppersatpricepointsthatappealtoabroadconsumerbase.Webelievethatourentreepricesaretypically
lowerthanthefastcasualsegment,andaslightpremiumtotheQSRsegment.Weprepareourentreestoorderinapproximatelyfourminutesandallowour
customerstheoptiontocreatetheirfavoriteflavorprofilesusingourfreshly-preparedsalsasbeforetheyenjoytheirmealsinourdiningroomsortaketheirmealsto
gofromthecounterorthedrive-thru.Wealsobelievethatourconcept,whichintegratesthecomplexityofcreatingrealfoodinrealkitchenswiththespeedofour
servicemodelandtheskillofourtrainedandcertifiedGrillMasters,providesalayerofcompetitiveinsulationaroundourrestaurantmodel.Basedonanexternal
researchreportandacustomersatisfactionsurvey,webelievethatourpositioningappealstoabroadcustomerbase,andthatourbrandcrossesovertraditionalage,
ethnic,andincomedemographics,givingconsumersthebestofboththefastcasualandQSRsegments.OurdifferentiatedQSR+positioningsourcestrafficfrom
bothdiningsegmentsandasaresultweexpectittodrivetransactiongrowthinthefuture.
Mexican-Inspired, Fresh-Made “Crazy You Can Taste” Fire-Grilled Chicken and Entrees .Oursignatureproductisourchicken,marinatedwithaproprietary
recipeofcitrusjuice,garlic,andspices,whichservesasthefoundationofourdistinctivemenuofflavorfulbone-inchickenmealsandMexican-inspiredentrees.
WithmenuitemssuchasourChickenAvocadoBurrito,ChickenTostadaSalad,PolloBowl®,andChickenAvocadoStuffedQuesadilla,webelievethatweoffer
ourcustomersahealthieralternativetotraditionalfoodon-the-go.OurentreesarepreparedusingfreshingredientswithrecipesinspiredbyMexicancuisine.The
majorityofourmenuitemsaremadefromscratch,includingourbone-inchickenandchickenbreasts,rice,salsas,guacamole,andcilantrodressing,meaningthat
wemakethemwithoutpre-preparedingredients.Theseitemsstartwithourchicken,whichismarinatedinourrestaurantsdaily.Fromthere,ourGrillMastersfire-
grillandhand-chopourchicken,formingthefoundationforourentrees.Tocomplementourentrees,ourteammemberssliceandchopwholetomatoes,avocados,
serranopeppers,andcilantrotocreateoursalsas,guacamole,andcilantrodressings.Inaddition,ourriceisseasoned,andsimmeredinourrestaurantsdaily.Our
salsasanddressingscomplementourrecipesandallowourcustomerstoenhancetheirculinaryexperiencewithcustomizedflavorprofiles.
Ourstrategicapproachtomenudesignhasresultedinabalancedmenuwithbroadappeal,asdemonstratedbyourbalancedday-partmix.Ourbone-inchicken
mealsandMexican-inspiredentreesaccountedfor47%and53%ofourcompany-operatedrestaurantsales,respectively,infiscal2015.Ourindividualandfamily-
sizedchickenmealsappealtocustomerslookingtodineattherestaurantortakeoutduringdinnertime,whileourmore-portableMexican-inspiredentreesdraw
trafficfromcustomersatlunchtimeorforanafternoonsnack,enablingustogeneratesalesalmostequallybetweenlunchanddinner.Webelievethatourfamily-
sizedchickenmealsprovideahealthierandconvenientalternativeformothersandfamilieslookingtosolvethe“dinnertimedilemma”ofprovidingtheirfamilies
withhigh-qualitymealswithoutinvestingsignificanttimeormoney.Infiscal2015and2014,approximately28%ofourcompany-operatedsalesweregenerated
fromfamily-sizedmeals.
Inviting Experience That Welcomes Our Customers .WebelievethatourHaciendarestaurantdesigncreatesaninvitingrestaurantenvironment.Theexteriorsof
ourrestaurantsfeatureasignaturegrillarchitecturalelementthatreinforcesourcorebrand,andourinteriorsfeaturelarge,openkitchensthatallowcustomersto
watchourgrillmastersprepareourfire-grilledchicken.Ourrestaurantsalsofeaturecomplimentaryself-servesalsabarsthatarelocatedatthefrontsofour
restaurantsforaddedconvenience.Thesalsabarsinvitecustomerstocustomizetheirmealswithseveralsalsaspreparedfresheveryday.Ourcolorfuland
contemporarydiningroomsincludecomfortableboothsandchairs,whilelargewindowsandsoftlightingfillourrestaurantswithlightandwarmth.Ourcustomers
arerespondingpositivelytoourHaciendadesign,ascomparablerestaurantsaleshaveincreasedonaverageanadditional3%to4%atremodeledlocations.Asof
theendoffiscal2015,over70%ofourrestaurantsystemisneworremodeledandweexpecttohavecompletedtheremodelingprogramby2018.
Webelievethattheatmosphereandqualityofservicethatweprovidetoourcustomersencouragesrepeatvisitsandbrandadvocacyanddrivesincreasedsales.Our
teammembersaretrainedtoengagewithourcustomersinagenuinewaytoprovideapersonalizedexperience,andstrivetomakeeachexperienceinourrestaurant
betterthanthelast.
Well-Developed Operations Infrastructure that Allows for Real-time Control, Fast Feedback, and Innovation .Webelievethatsatisfyingourcustomers’dining
needsisthefoundationforourbusiness,andwehaveawell-developedoperationsplatformthatallowsustomeasureourperformanceinmeetingandexceeding
thoseneeds.Weutilizeastate-of-the-artoperationsdashboardthataggregatesreal-time,restaurant-levelinformationfornearlyeveryaspectofourbusiness.The
dashboardprovidescorporateandfieldmanagement,aswellasrestaurant-leveloperators,withinsightintohowweareperformingbothfromthecustomer’s
perspectiveandalsothroughtheeyesofexperiencedthird-partyauditors.Toputthemetricsintoperspective,weareabletomeasurecurrentperformanceagainst
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