Content area
Full Text
More than three years ago, Doug Kollus, Tony DeGrazier and John Wagner of Islands Restaurants, L.P. were at a crossroads in terms of growth.
The successful Solana Beach-based restaurant chain best known for its hamburgers could either expand beyond Southern California and Phoenix or launch a new brand in their markets.
The partners chose the latter, and after some research decided to create a new Tex-Mex eatery. Their markets lacked a restaurant with that focus, they reasoned, and they could build locations near current Islands restaurants.
Ramifications from that decision continue to pan out, said Kollus, Islands' president.
Tortilla Beach opened in Foothill Ranch in Orange County last October-to less-than-stellar results.
According to Kollus, the goal was for the new restaurant's first-year sales to equal that of the average Islands, which is $3 million.
Instead, Tortilla Beach is on track for an income in the low $2 million range, he said.
It cost $2.8 million to build, and the restaurant's look and menu have been reworked since the launch.
Tortilla Beach's week-to-week sales continue to grow, and Kollus remains optimistic.
The company will decide over the next several months whether to launch more Tortilla Beach locations, he said.
"If the sales build, then I would say next year, we'll start looking for another location," Kollus said. Currently, weekly sales are in the mid$40,000 range, and they'd need to increase to $50,000 and $60,000, he said.
Overall, the company's income continues to climb. Projections for 2002 have sales at $100 million, Kollus said. They were $90 million in 2000 and $58 million in 1998.