Boston’s Restaurant & Sports Bar is expanding in Mexico at a time when more restaurant chains are looking south of the border for international growth .
Mexico offers growing restaurants several advantages, including its proximity to U.S. corporate headquarters. The nation also has a younger population, rising household incomes and a stable Gross National Product.
Casual-dining chain Boston’s currently has four units in Mexico, 358 in Canada and 40 in the United States. The concept is owned by Canada-based Boston Pizza Restaurants L.P.
“We had one unit there [in Mexico] that opened about 11 years ago,” said Mike Best, chief operating officer of the Irving, Texas-based U.S. Boston’s division. “Two years ago we started refocusing ourselves on Mexico development.” The company has sold 12 additional units there over the past 14 months, and three of those will open this year, he said.
“We said we spent a lot of money getting ourselves established in Mexico, so we said, ‘Let’s go try to leverage that,’” Best said. “I hired a gentleman out of Mexico City to be a sales rep for us, and we embarked on trying to add some units there.”
The first two restaurants opened in Merida, Yucatan; the third in Ciudad del Carmen; and the fourth, in Villahermosa, opened in May.
Best spoke with Nation’s Restaurant News about operating in the country.
How does the Mexican market differ from the U.S. market?
Of the four stores, the average square footage is approaching almost 8,000 square feet. They’re big. They seat, on average, about 345 people, excluding how many kids you can jam into the play zones. That compares to about 289 seats in U.S. units.
What differs beyond the size of the restaurants?
The feel is pretty much the same. You have the dining room on one side, the bar on the other and a patio. But each of the four locations does have a play zone. These are all inside the building, heated and air-conditioned. The original store in Merida had one to begin with, but it has been expanded.
The play area seems to be a big attraction. How has it changed?
The newest one in Villahermosa has two sections to the play area: the toddler area, where they climb on things, and the other side with video games. Each one of the locations has an attendant to make sure the children are signed in and signed out.
Is the Mexican customer’s approach to casual dining different than the U.S. customer?
People in Mexico consider it an event. They will linger in the restaurants two-and-a-half to three hours. The happier their kids are, the longer they stay and the more they spend, which works out very well for us. These [playgrounds] are fully exposed to the dining room with soundproof glass, so parents can keep their eyes on the children.
What about outdoor seating?
The patios there are huge, and each one has a full, functioning outside bar. We have patios at our stores in the U.S. and Canada, but they are just seating areas. In Mexico, the bartenders can go back and forth. The patios also have lounge areas, as opposed to tables and chairs. These are wicker seating areas where you can have appetizers and drinks, but probably not full meals.
Are the demographics different?
The proportion of families is higher in Mexico. The casual-dining user is similar to the United States. With the four stores, we’ve noticed people will go to Boston’s for a special event, such as a birthday, anniversary or date. That’s not who we are in the United States. In Mexico, Boston’s is perceived to be a bit higher level of casual dining. It’s more upscale.
What about the bars?
The bar demographic is very similar — big on sporting events. All four of the restaurants have pull-down screens in the dining room for the big soccer tournaments. The entire facility turns into a big sports area.
How have volumes tracked?
The volumes have been shockingly good. Per person check averages are very, very strong. In Mexico, more than 40 percent of the pizza sales are the large size. They share it as a prelude to dinner. They do appetizers, entrees, desserts and coffee.
Are menus significantly different?
We have 91 items on the U.S. menu, and there are 91 on the Mexico menu. There are eight products that are specific to Mexico. Nachos, for example, don’t translate well. Nachos are a big seller in the U.S., but in Mexico it’s a Texas creation and they don’t want anything to do with it.
How about sourcing?
We try to source locally as much as we can. About 38 percent of the product on the menu comes from the U.S., and that’s more proprietary, like sauces and pizza dough.
How do unit volumes compare?
In the U.S. we’re averaging just under $2.1 million in average unit volumes. At the four stores in Mexico average unit volumes are close to $2.7 million.
What do you see for further development in Mexico? Are you concerned about safety amid drug cartel fears?
We’re very optimistic about where the future will take us. Clearly, from a security standpoint, we’re pretty careful about where we go. I don’t see us putting restaurants in Tijuana or some of the border towns where we know there are problems.
This article has been revised to reflect the following correction:
Correction: February 19, 2013 This story corrects the location of Boston's second location in Mexico. It is located in Merida, Yucatan.