Spanish operator looking to add U.S. brands
Dining out is a national pastime in Spain, says new Hooters franchisee Julio Arias, CEO of Grupo Iberfood. Barcelona’s Placa Reial square, above, is one of many popular dining destinations.
Thanks to a 1999 Adam Sandler movie, Hooters will open its first-ever location in Barcelona, Spain, this summer.
It was from watching “Big Daddy” that Julio Arias first became interested in the Atlanta-based restaurant chain known for its busty, orange hotpants-wearing, chicken wing-serving waitresses.
“Since I saw it, I knew I wanted to own a Hooters,” said Arias, CEO of Grupo Iberfood, which signed a development agreement to open 15 Hooters locations in Spain and Portugal.
“I saw the opportunity to have this iconic brand in Spain and went for it. And I hope to have the chance to also expand this brand to Venezuela.”
If readers don’t recall, Sandler’s character in “Big Daddy,” Sonny Koufax, has a friend whose fiancé is a former Hooters girl, and Koufax makes constant references to the chain throughout the movie. The closing scene was actually shot at a Hooters in Manhattan.
It was “the girls, of course,” that stood out to Arias as he considered what differentiated Hooters from other casual restaurant concepts, but beyond that, “American brands are beloved in Spain,” because people have either “traveled to the U.S. and experienced them or have seen them on movies or television and are curious to try them,” he said. “Plus they tend to be so delicious that locals keep on liking the taste.”
With headquarters in Pozuelo de Alarcón, Spain, an affluent suburb of Madrid, this is Grupo Iberfood’s first franchise deal with an American brand. Grupo Iberfood’s owner, the Arias Martinez Family Group, has other businesses in Spain and Arias’ native Venezuela, including consumer packaged goods and agriculture production.
Julio Arias, left, is Hooters’ new operator in Spain, pictured with Chief Development Officer Mark Whittle.
Arias noted he’s in advanced talks with other American brands and said his past restaurant experience with Venezuelan franchises such as Tropi Burger and Priazzi have given him the operational knowledge to grow Grupo Iberfood as a multi-unit, potentially multi-brand, franchisee.
“The thing that I apply most to Grupo Iberfood is that you either obtain the original brand of something or you create something entirely new, but lackluster imitation is never the key,” he said. “We are going to keep the Hooters concept as close as possible to the American restaurants so our customers in Spain could receive the same experience as if they were in the USA.”
After the Barcelona restaurant opens this summer, four locations in Madrid and Seville are slated to open within three years; the launch in Portugal is planned for late 2018.
The deal with Grupo Iberfood, along with recent announcements of expansion in Bolivia, Singapore and Central America, is part of what Hooters Chief Development Officer Mark Whittle called a “renewed effort” of international development that began about four years ago. The company has 86 international locations, with development commitments for another 90 restaurants, Whittle said.
Hooters’ global development strategy puts countries and regions into one of four tiers. Spain, Whittle said, is in Tier 1, “where we want to grow as rapidly as possible.”
“Spaniards love to eat,” said Whittle. “And they love to drink. There’s really no sports bar-type concept in Spain … and really no dominant wing player in the market, no one that really specializes in wings and does wings well.”
Plus, as Whittle tastefully put it, “there’s also no other female server concept,” while in the United States Hooters competes with the likes of Tilted Kilt and Twin Peaks.
Edwards Global Services, too, identified Spain as a country to watch for new franchise development, noting its recovery is speeding up following a recession that stretched from 2008 to 2013, when unemployment grew to almost 27 percent.
Unemployment is still high, hovering around 20 percent, but Whittle called that out as a positive for new businesses in the country such as Hooters, which will hire dozens of employees with each restaurant opening. The country is also experiencing record tourism and export levels, along with “revived domestic consumption,” according to the U.S. Commercial Service.
Whittle, who previously served as chief development officer for family-dining chain Huddle House and spent six years as VP of real estate for Focus Brands, said Hooters is “disciplined” in its approach to international growth and looks “first and foremost” for partners with several years of multi-unit restaurant experience. The company doesn’t sign master franchise agreements, as it prefers to work directly with the franchisee in each region.
Of Arias and Grupo Iberfood, Whittle said, “they had the restaurant experience, they know the market and they’re very well capitalized.” International partners must have a minimum net worth of $3 million, liquidity of $1.5 million and ability to develop at least three restaurants in the proposed territory. Grupo Iberfood, Whittle said, is also well positioned to execute on marketing, with its social media accounts already building buzz since the agreement was announced in March.
For Arias, “longevity, name recognition, quality of food and ease of implementation in our territory,” were priorities in choosing Hooters. Other factors were the uniqueness of the brand and “of course a decent profitability.” The average unit volume for Hooters’ international restaurants is $2 million, said Whittle.
“The brand has to be very strong in the U.S. for us to have success abroad,” said Whittle, noting a new restaurant design that debuted in 2013. “Getting the brand ready to grow in 2012, 2013 has really been key to being able to sell the brand internationally.”
The big screen helped Hooters expand to Spain and the company now has its sights set on a leading role on the global stage.