Taco Bell, slated to open its first alcohol-selling restaurant this year in Chicago, is planning a similar unit in San Francisco and evaluating other cities as well.
The San Francisco restaurant, near AT&T Park, will sell beer, wine, appetizers and feature a walk-up window, Taco Bell Chief Executive Officer Brian Niccol said in an interview in Chicago on Thursday. The company is looking at opening similar stores in Boston, New York and Columbus, Ohio, he said.
“We’re underpenetrated in urban markets,” Niccol said. “It’s where you have that density, and frankly where people aren’t in cars.”
While about 85 percent of Taco Bell’s U.S. locations have drive-thrus, many of the city restaurants won’t, Niccol said. Not all urban restaurants will sell alcohol, he said.
The fast-food chain is doubling down on efforts to compete with fast-casual restaurants, such as Chipotle Mexican Grill Inc., Potbelly Corp. and Panera Bread Co. So far its efforts to tout new and affordable fare have paid off. Same-store sales at Taco Bell gained 6 percent in the second quarter.
Taco Bell’s first booze-selling Chicago location will offer Dos Equis and New Belgium Brewing Co.’s Fat Tire beer, red sangria and liquor including Don Julio tequila and Ketel One vodka. It also will have shareable snacks such as rolled chicken tacos and nachos.
The Yum! Brands Inc.-owned chain recently started experimenting with delivery and catering, services that many fast-casual chains offer. Taco Bell will expand delivery to as many as 400 locations by the end of this year and about 1,000 by the end of 2016, Niccol said. Some restaurants near Houston are testing a catering program.