For Taco Bell, flexibility is key in growing internationally

In an exclusive interview with QSR Media, international president Liz Williams explains the principles behind their expansion plan.

Taco Bell shows no signs of backing down from their aggressive global growth strategy. Outside of the United States, the brand continues to cite potential for creating an additional thousand units over the next couple of years.

Most recently, they have signed their first-ever master franchise agreements with Sforza Holding Group in São Paulo, Brazil and Casual Brands Group in Spain. Locally, the brand's Australian franchising partner Collins Foods announced its plans to increase their store count over the next 12 months. 

At the helm of Taco Bell’s international operations is Liz Williams, who got promoted to president for international earlier this year following her predecessor’s retirement from the brand. QSR Media exclusively sat down with Williams to discuss the latest trends they have seen in their consumers, their brand strategy, and her outlook for the food and beverage market.

QSR Media: From your role of chief financial officer, what are some of the milestones and lessons and challenges that you’ve taken into this role as President of International?

Liz Williams: I look at it as less about challenges and more about opportunities. In the U.S. over the last couple of years as CFO, we have seen six years of store sales growth. The reasons for this are our value and innovation.

People said the U.S. was so penetrated a couple of years ago and that it wouldn’t grow anymore. Yet over that time period we grew by hundreds of units. I take that energy internationally knowing that Taco Bell brand is such a strong brand and knowing so much about how to grow a brand in a large, successful market. It gives me the confidence to take this model around the world.

QSR Media: How do you take a brand that is so huge and so popular and replicate it in other markets?
It's a youthful brand that translates really easily around the world. It’s also a very social brand. It’s a brand that you communicate well to any market.

QSR Media: What can we expect from the brand’s strategy domestically and internationally in the next 5-10 years?
A lot of the things that have made us successful in the U.S. Value and innovation really propelled the brand domestically and I expect that strategy to continue globally.

QSR Media: When you say value, what do you mean?
There’s something on the menu for everyone. If you only want to spend a few dollars or pounds, we certainly have a value menu but what sells the best, especially in international markets, are combos. Guests can get a taco, burrito, some chips, for between £5-£7. The thing about the U.S. menu that made us so successful is that unlike other QSR concepts, guests can build their own combo. Our menu has more creations on it and our menu is flexible.

QSR Media: Does that make it more operationally complex to deliver vs some of the other Yum Brands?
People always think more choices mean operational complexity. The brand’s operational model is amazing so we figured out a way to bring flexibility and choices within the operational model.

QSR Media: Aside from your role at Taco Bell, you’re also involved in some non-profit work. How important do you think it is for executives to show publicly that they’re involved in charity work?
It's critical for everyone to do it - whether you're an executive or not. Find something that you’re passionate about and give back. Throughout Taco Bell, we have a real belief in all people. In the U.S., we launched the Live Más scholarship and the Taco Bell Foundation for teens.

QSR Media: In terms of product innovation, what is done locally and what originates from the U.S.?
It’s a little bit of both. In the U.S. we spend a huge amount of time and love and resource on innovation. We can’t the get innovation quick enough for everyone so the problem is commercialising it and marketing the brand around the world. Locally, we encourage our regional teams to bring some local innovation that fits their local market.

QSR Media: What changes have you made in your operating model to expand internationally?
In the U.S., we’re predominantly a drive-thru model and in the UK, we’re more of an in-line. Part of what made us successful this time around, if you’re not familiar with Taco Bell or the Mexican category, you’re going to have a lot of questions about the food and what it looks like. Internationally, we learned that people want to see it. There’s this trend of people wanting to see this great fresh food – that is what Taco Bell is. 

QSR Media: What trends are you seeing in your customer base? Are the trends the same or different domestically vs internationally?
I think the trends are very similar. People want choice and flexible options. Today I might want to be vegetarian, tomorrow I won’t be one. There’s also the trend of this ‘all access’ to your brand at ‘all times’. They want to use technology to be part of the brand. Delivery is a huge opportunity in terms of consumers. When they can’t go to the restaurants or to the drive-thru they wonder if someone can deliver it to them. In Asia, delivery is on fire because the traffic in some cities is maddening. Motorbikes can get the food to consumers quicker than they can make it to stores.

QSR Media: How big do you think you can get in Asia, Australia, and the UK? In what timeframe?
We said a few years ago, we see potential in international for a thousand units over the next couple of years. As I go around the world, I see so much opportunity for that to happen. How it breaks down by region we haven’t really specified, but I think it’s going to take all regions together, making our target become a reality.

QSR Media: How are your growth plans panning out so far?
I’m seeing high rents in every market around the world. I think the fact that we have this flexible restaurant format that you can customise to different locations is one of our advantages as it means we can be efficient with our space. You’ll get the right rent and make the economics work. We’re providing flexibility whilst delivering the right experience.

QSR Media: Aside from digital ads and online ordering, how else would Taco Bell use technology?
I think there are so many opportunities - starting with the consumer at the point of ordering. Consumers quite like the idea of walking to a kiosk to avoid queueing. In Asia, where multiple languages are spoken this technology allows us to cater to people really well. But aside from the customer side, we also use technology in our training, and to make our operations more effective.

QSR Media: What’s your outlook for the food and beverage market?
People are always eating three meals a day and that just inherently brings growth. People want choice, variety, fresh options. So I think those trends are going to continue shape the industry. People want convenience more than ever, but they want it faster and easier. That’s a huge opportunity.

(Photo courtesy: Taco Bell Australia)