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Qdoba aims to serve in a New York minute

NEW YORK There’s a reason the song says, “If you can make it here, you can make it anywhere,” as the management of Qdoba Mexican Grill was all too aware when it opened the Denver-based chain’s first company-operated store in New York City two months ago.


Intended as a prototype for a major push into New York and other major urban markets, the unit was developed at an A-plus site in the heart of midtown, an area where C and D locations would outstrip the rents for primo corners almost anywhere else in the nation. If the 3,000-square-foot store was to be a financial success, chain officials knew the store would have to veritably hum with volume. And that meant customizing the operations for maximum throughput.



Chief operating officer Richard Pugh calls the store “a cranked-up version for more urban settings,” the result of extensive research into the peculiarities of operating in New York.  With high-rise buildings housing as many office workers or residents as a whole town might, the potential volume was clearly there. The trick was how to snag those patrons’ attention and get them all served.


Scouting the competition in an area that sports units of Chipotle Mexican Grill, several Subways, a Quiznos, a McDonald’s and such local contenders as Burritoville and Chop't Creative Salad Co., management saw that most of the traffic had to be handled in a two-hour window. Qdoba had to figure out a way of offering customization, a signature of the brand, without sacrificing speed.

The New York unit broke the chain’s mold by incorporating two ordering lines instead of the usual single queue, where patrons give their order and then watch as it’s assembled to their specification as it moves along the array of hot and cold ingredients. In essence, the store doubled the usual assembly setup.

But the second line itself does double duty, serving as a conventional production line during lunch and the place where delivery orders are prepared before and after that period. The unit, located at the corner of 53rd Street and Third Avenue, in the ground floor of a skyscraper office building, is in an area where delivery and catering are in high demand.


“We're able to produce all the food on a separate line away from the guests that are coming to dine at Qdoba," Pugh says. "It's almost like two separate restaurants.”



In addition to the two production lines, a center station accommodates orders that were called in for pickup, a process that can shift some production ahead of the lunch rush if patrons, including those placing a catering order, submit their orders early.



"We believe online ordering is going to be an important part of our future sales growth," Pugh says.



An online system is being developed in-house because Qdoba wants to include the capability to customize orders, says Bill McMillan, Qdoba’s vice president of information technology. Qdoba also wants the system to feed into the unit’s point-of-sale system and accept prepayment so “we hand you your bag and you're on your way," he says.



Much of the burrito outlet’s exterior is glass, allowing potential patrons to peer in from the street and from the lobby of the skyscraper that houses the restaurant. In addition, because the entrance from the building lobby is closer to the second line and the streetside door is closer to the main production queue, the setup tends to distribute and regulate traffic, Pugh says.



To help patrons efficiently move through the lines, the unit schedules a regional marketing specialist during the lunch rush to teach customers how the process works. He or she also acts as a greeter and steers patrons to the line moving the fastest.



Part of the location’s appeal was the diversity of the store’s surroundings, Qdoba chief executive and president Gary Beisler explained in a meeting with the editors of Nation’s Restaurant News before the unit’s debut. It’s smack-dab in one of the most densely populated business centers in the world, sits near one of the city’s busiest subway stations and is down the street from apartment buildings.



With thousands of people bubbling out of that station on any given workday morning, the unit is part of the 10 percent of the Qdoba system that offers breakfast.



“Breakfast is really a small part of our overall business strategy,” Pugh says. “It's designed to supplement densely populated urban areas.”



The morning ritual for New York office workers is to grab something on their way to the office to munch at their desks. Portability is crucial, so the anchor of the Qdoba store’s morning menu is a breakfast burrito.


The breakfast burrito is built the same way as a lunch or dinner burrito. The issue is devoting the assembly lines to that purpose for the morning rush. Pugh acknowledges the challenge of losing what would otherwise be prep time for lunch components like salsas and guacamole. The second line is switched to that function when it closes to dine-in customers at 3 p.m., he says.

The shift of prep time has the added benefit of allowing the unit to offer a longer work day to potential staffers, instead of the usual two- or three-hour shift.


The Manhattan store’s 3,000 square foot expanse seats about 80 customers. When Pugh and his team were researching the peculiarities of operating in New York, "we watched everything go out the door," he recalls.



"I didn't think we'd need all this seating, but we were pleasantly surprised that we're filling that dining room every day,” he says.



Another pleasant surprise, Pugh says, is how much traffic the store is handling at night.  Stores in suburban location usually see the bulk of their evening business between 6 and 7 p.m., he says. The New York store sees the rush stretch from 7 p.m. to as late as 9 p.m., even on weeknights. Dinnertime also generates delivery orders from the office buildings in the area. With all those factors, Pugh says, the unit is still experimenting with its nighttime hours.



Beisler would not divulge how much the chain is paying in rent for the New York location, though he acknowledged that the amount is far higher than the chain's norm. Nor would he disclose how much the company would raise its prices to cover the higher costs.  But he stressed the importance of volume, a message echoed by Pugh.



“We need to make sure we’re building this machine for handling tremendous capacity,” he says. “It's a new type of thinking in this location.”


Qdoba operates or franchises about 400 restaurants in 39 states. The franchisor is owned by San Diego-based Jack in the Box Inc.

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