The future of quirky, Mexican-flavored burger chain Del Taco LLC now is in the hands of an Englishman.
In November, Nick Shepherd, head of Del Taco’s Nashville-based parent company Sagittarius Brands Inc., took over running the chain known for its menu of tacos, burritos, burgers and fries.
Shepherd has a corporate pedigree that includes Blockbuster Inc. and Whitbread PLC, a hotel and restaurant operator in the U.K.
He’s a contrast to Del Taco’s last boss, Shirlene Lopez, who spent 30 years at the company after getting her start mopping floors and wiping down tables. She eventually became president, reporting to Shepherd.
Shepherd brings big ambition to the job. His goal is to double Del Taco to $1 billion in yearly revenue in the next five years.
By comparison, industry leader Irvine-based Taco Bell Corp. has yearly sales of about $2 billion.
New Plans
Del Taco has spent the past six month evaluating and building development plans for restaurants, according to Shepherd.
The company now has about 500 company-owned and franchised restaurants in 18 states. Most are in California.
Del Taco is seeking franchisees, according to Shepherd. The recession could make it hard to recruit entrepreneurs to open Del Tacos, he said.
“Our intent isn’t to cover the map with Del Tacos, but to cover the market with high-quality Del Tacos that are very cost effective to our investors,” Shepherd said.
Sagittarius Brands acquired Del Taco in 2006 and also owns Tennessee-based Captain D’s Seafood Kitchen.
Shepherd became chief executive and chairman of Sagittarius in early 2008. Before that, he was chief operating officer of Dallas-based Blockbuster Inc., where he started in 1995 in his native Britain.
He spent the first part of his career managing restaurants for British companies Whitbread, Allied Lyons PLC and Grand Metropolitan PLC.
“I’d heard about Del Taco from former Southern Californians who said, ‘If you’ve not had Del Taco, you’ve not had proper food,'” Shepherd said.
He also said he’s still feeling out his role running Del Taco after Lopez’s departure, which baffled some company watchers.
He called the decision to leave hers.
“I was upset, having just started with Sagittarius,” Shepherd said. “You don’t want to go losing your key people the first couple months on the job.”
Lopez was the “brand ambassador” for Del Taco, he said.
Shepherd said he likens himself to being a conductor.
“You don’t know how to play any of those instruments but you have to assemble them and get them to the right thing at the right time so they sound great,” he said.
Taco Bell will serve as Del Taco’s barometer, according to Shepherd.
“They are a great competitor that has done a great job of pulling their business up by the bootstraps over the years and that tells me the market is buoyant,” he said.
So far, Taco Bell has been holding its own in the downturn, posting 8% sales growth at restaurants open at least a year in the third quarter.
Shepherd is overseeing some rebuilding at Sagittarius’ other chain, Captain D’s Seafood Kitchen.
“Captain D’s is a much older brand and over its recent history it’s had some neglect,” he said.
Captain D’s has more than 600 restaurants in about 20 states, primarily in the South and Midwest.
It is run by David Head, Captain D’s president and chief operating officer.
Rivals include Long John Silver’s Inc., which, like Taco Bell, is part of Louisville, Ky.-based Yum Brands Inc., and Arthur Treacher’s Fish & Chips, part of New York-based TruFoods LLC.
Shepherd splits his time between Del Taco and Captain D’s.
“The truth of the matter is you can’t be an absentee landlord,” he said, “So I commute to Nashville and spend time with the Captain D’s folks and fly back to spend time with Del Taco.”
New Home
Shepherd said he now calls Laguna Beach his home. Up until summer, he lived in Dallas and commuted to Nashville to run Sagittarius.
Most of his time in California is spent at Del Taco’s Lake Forest headquarters or visiting restaurants.
“When I’m out at the restaurants and I’m sitting down with our managers over coffee, I actually get a lot of feedback,” Shepherd said. “They’ll tell you how their customers are, what they like about what we’re doing and what they don’t like about our marketing programs.”
He called the feedback “our lifeblood.”
The company recently remodeled eight restaurants in Riverside. The project could become a model for the rest of the chain, Shepherd said.
A big focus is on getting people into the restaurants.
“Growing the number of customers who use the store has become the measure of success in a down economy,” Shepherd said. “So building that loyalty with our customers is a pretty damn good thing to do.”
The company also expanded its marketing team and started a campaign dubbed “Go Bold or Go Home” with the Newport Beach office of advertising agency W.B. Doner & Co.
“We know it’s going to take a bit of time to resonate with our customers,” Shepherd said.
