Gema Boiza. Journalist. @GemaBoiza
Restaurant chain BaRRa de Pintxos is set to open two new locales in Madrid, one in Sanchinarro neighborhood in March, and another on Paseo de la Castellana by summer. Both franchises are part of its 2014 strategic plan. This year the company plans to open 10 new restaurants in Madrid, update its tapas and pintxos menu, increase its offer to include snacks and brunch, and strengthen the business with a view to entering other provinces in 2015 and other countries within three years, as managing partner Eduardo Sancho told Wiki Spanish Food.
The chain was created in 2010 by Luis Díaz Córdoba, who Sancho joined in 2013 with a dual objective: to integrate new technologies into the brand and commercialize the franchise, which currently has three locales in Madrid: on Diego de León and Castelló streets and in the Montecarmelo neighborhood.
"We are currently concentrating on the city of Madrid and its north- and southwest areas, and if everything goes according to schedule, by year-end we may consider expanding to other provinces," says Sancho, who also highlighted that the two partners have received requests from people in Levante and Andalusia (Spain's east coast and southern region, respectively) to franchise the BaRRa de Pintxos business.
This is precisely the model that the partners want to use to expand the company, which "has found its place in the market, with an average ticket of 15 euros", says Sancho. In his opinion, that price separates the brand from the price wars faced by other companies in the sector in Spain.
Opposed to the price war
"We don't want to enter into the price war to sell beer for between 70 cents and a euro, like other chains do, because aggressive promotional efforts can jeopardize your credibility and give your business a bad image", says Sancho. He and his partner also plan to update the menu next month.
As a result of those changes, the current selection of crocks will be called tapas, of which there will be 25 varieties, as is the case with pintxos. Both options are meant to be eaten with silverware, in line with the company's goal of "sophisticating the pintxos culture".
This objective leads to another, more international goal. As Sancho told Wiki Spanish Food, the plan to switch from crocks to tapas is due to the company's internationalization plans since, outside Spain, from a language standpoint, the "tapas" concept is much more appealing than crocks.
US, the first international destination
Sancho expects BaRRa de Pintxos to expand beyond Spain in three years at the earliest. "To enter international markets, you have to be very organized and consider factors such as logistics, positioning in Spain and potentially in other countries, and the possibility of entering a market with a local partner to facilitate the process".
BaRRa de Pintxos has generated interest among potential franchisees in Australia, China, Mexico, Peru and London, according to Sancho. However, the owners' priority is the US. "When we address the issue of internationalization, first we'll go the US and then to Latin America", he says.
But before that day comes, the business has to reinforce its position in Spain and meet the goals set by the partners: increase revenues by 10% year-on-year in 2014.
Another challenge this year is extending its offer to include snacks and brunch, and the roll out of new promotional campaigns, like the one currently under way for 2 euro pintxos.
Other issues they are considering for 2014 are home deliveries and an afterwork option. At the moment, they will continue to offer a menu of the day with pintxos and tapas for 9.95 and 11.95 euros.
What does it cost to franchise BaRRa de Pintxos?
Initial investment: 165,000 euros
Entry fee: 26,000 euros
Locales spanning approximately 120 square meters with a terrace for at least 12 tables.