Rising inflation and food and labour costs don’t faze Guzman y Gomez founder and chief executive Steven Marks, who is so confident of continued success for his Mexican fast-food empire that he plans to nearly double its WA footprint in two years.
“People will always need to eat,” said the former New York hedge fund manager, whose stores number nine in WA and 150 across the country.
“Food can’t be replaced with technology.”
The next seven Guzman y Gomez outlets for WA will include drive-throughs, a model more commonly associated with fast-food giants McDonald’s and KFC, but one that Mr Marks said has paid off so far, emphasising that the drive-through model was ripe for disruption.
He sees the giants of the quick service restaurant industry as his competition, despite 16-year-old Guzman y Gomez being a comparative minnow, and says the burst of activity in WA is the result of “not being able to get in for two years” due to border restrictions.
“People would say to me, ‘why do you always call yourself fast food? You’re not fast food’. I say, no, we’re what fast food should be,” Mr Marks said.
“They’ve gotten away with what I believe is poor quality food … when companies sort of have monopoly on stuff. When you’re challenging and coming up, you have better value, better quality.”
Born of a desire to show Australians how Mexican food should be enjoyed, Guzman y Gomez also has outlets in Singapore, Japan and one in the US.
“Mexican restaurants were packed and I thought the food was so poor,” Mr Marks said of his first exposure to the cuisine, Australian-style.
“I was like, wow, if they actually got what Mexican food should be, man, they’re gonna love it.”
While conceding rising costs are of a concern for consumers, Mr Marks sees little potential impact for Guzman y Gomez.
“Listen, nobody likes rising interest rates, right?” he said. “Now they’re raising rates and the markets seem a bit iffy.
“One of the reasons I built GYG I wanted to create something that people need, no matter what the markets look like, no matter what the world looks like.
“You can’t make it cheaper at home. You need to make sure that you have the quality and the value to give your guests and then other than that, your business should be taken care of.
“I think fine dining and things that are luxury items, you know, will suffer. But man, food’s always gonna be food, right?”
Despite the tranche of competitors in the Mexican category alone — including Zambrero, Salsa’s, Taco Bell and Mad Mex — Mr Marks sees food quality and a value proposition as the key to stand out.
“It’s so healthy and so full of flavour and that’s why I knew it would be a success in time.
“To me, it’s not a fad, you know. We’re not selling goulash or some sort of thing that hasn’t taken off in the world like Mexican food.
“There’s so much space to grow.”