Number of franchise units in the United States: 32
Total number of US units: 36
Total system-wide sales: $35,554,880
Average unit volume of the franchise: $1,099,722
Total average unit volume: $1,099,722
Franchise fees: 25,000
Royalties: 5% of gross sales
Renewal fees: 50% of the initial franchise fee then in effect
Marketing costs: If established, the amount specified by Rusty Taco, subject to the marketing expense requirement.
Total startup costs: $531,900 to $897,450
VetFran Program: The “VetFran Program” is designed to provide career opportunities for honorably discharged military veterans or wounded warriors. This applies if you are a veteran or returning military (who has not previously signed, or had an affiliate who has signed, a development agreement or franchise agreement with the brand) who qualifies. The reduction is 50% on the initial franchise fee for each franchise contract. Rusty Taco apply
the pro rata rebate for each franchise agreement against the development fees payable under your development agreement.
Prospective franchisees may qualify for both the VetFran program and the standard adoption incentive program.
Standard Adoption Incentive Program: Notwithstanding the first sentence of Section 4.2 of the Franchise Agreement, if You open the Restaurant pursuant to the terms of the Franchise Agreement (including but not limited to Section 3.1 (site selection and on-site evaluation) Section 3.2 (franchise site request)section 3.3 (Building Lease)section 3.4 (Restaurant designed and built)section 3.5 (Opening)Section 6.5 (Terms of purchase)Section 6.6 (Purchases from Designated Sources) and Section 6.7 (Franchise location; Vehicles)the fee will be modified as indicated below:
Period of time
first 12 months of operation
13 to 24 months of operation
25 to 36 months of operation
Remaining term of the franchise agreement
Notwithstanding the foregoing, if you open the restaurant pursuant to the terms of the franchise agreement at least three months prior to the opening date, the royalty will be zero percent of the gross sales accrued for the first six months the restaurant is open. , and the royalty rates outlined in the table above will apply beginning six months after the restaurant’s actual opening date.
Advancement Incentive 2022: If you and Rusty Taco already signed a preexisting development agreement, or if you and the company sign a new development agreement, with a development timeline that requires you to open a restaurant in 2023 or later, and you sign a franchise agreement for and open this restaurant in accordance with the franchise agreement and the development agreement no later than December 31, 2022, and you submit development costs to the company within 120 days of opening the restaurant and construct the restaurant in design, to specifications and in the approved location, the royalty fee will be zero percent of gross sales accrued in the first year (12 months) that the restaurant is functioning; 2% of gross sales accumulated in the second year (13–24 months) that the restaurant is functioning; 4% of accumulated gross sales in the third year (25–36 months) that the restaurant is functioning; and 5% of the restaurant’s gross sales accumulated over the remainder of the initial term of the franchise agreement. If you fail to open the restaurant in accordance with the franchise agreement and/or the development agreement (if applicable) no later than December 31, 2022, do not submit development costs to us within 120 days of the restaurant opening, or do not construct the restaurant in the design, to specification and in the approved location, you will not be not eligible for the 2022 Pull Forward Incentive and your royalties will be 5% of gross sales for the duration of the franchise agreement.
Sizing from the sideline:
“With more resources after being acquired by Inspire Brands, it’s hard to bet that this 36-unit brand will become much larger in the years to come. With most markets open and no end in sight for the taco trend, franchisees have the opportunity to both choose prime territories and capitalize on the rising tide of consumer preference and increased brand recognition. .
“I love this brand and its brand story. I also love the simplicity of the concept, ‘nothing fancy, just real flavor and cheap too’. Although this brand doesn’t have the cachet in its name that more mature brands appreciate, it has the full force of Inspire Brands behind it.
This means that the same economies of scale offered to franchisees of brands such as Arby’s, Buffalo Wild Wings, Sonic, Jimmy John’s, Baskin-Robbins and Dunkin’ will be found here. Additionally, Inspire offers very powerful incentives to franchisees who sign development agreements to open stores within the next 36 months.
Founded in 2010 by Rusty Fenton and his wife, Denise, Rusty Taco fuses the flavors and experience of a traditional taco stand with flexible prototype designs. The Inspire Brands-backed chain (Dunkin’, Sonic, Buffalo Wild Wings, Baskin-Robbins, Arby’s and Jimmy John’s) has 36 locations in multiple states, with its newest store opening earlier this year in San Antonio.
Unlike other taco chains, Rusty Taco enjoys three strong times of the day, with a high percentage of morning sales thanks to a line of breakfast tacos. All tacos can also be ordered as rice bowls or salads, helping to spread out the occasions. To capitalize on recent trends, it also unveiled an elevated prototype with an on-site bar. The layout offers additional dining and seating options. Other adaptations include mobile ordering and pickup through its app, website, and third party. As the Council mentioned, Rusty Taco is a rare prospect with the backing of one of the largest conglomerates in the country. The company notes that franchisees can invest in a new, emerging chain with plenty of white space, while doing so with the “comfort and security” of the Inspire Brands engine. This includes shared services such as development, supply chain, and marketing support. Multiple franchise agreements have been signed in 2021 which will drive growth throughout Utah, Nevada, Virginia and Texas. Several new operators are already part of the Inspire family.