American dynamo chose Australia for Mexican empire start to combat ‘crappy’ incumbents

Aussies had been eating a ‘crap’ version of this cuisine until a US entrepreneur burst onto the local scene, building an empire set to treble.

EXCLUSIVE: Australians had been eating a “crap” version of Mexican cuisine until an American entrepreneur burst onto the local scene, building an empire of 140 restaurants with an ultimate grand plan to start a further 300 back home.

Guzman y Gomez founder and chief executive Steven Marks grew up eating authentic Mexican and as a child dreamt of building a hotel in Bondi, where he eventually moved.

But the plan didn’t eventuate and instead, he started the chain with its first restaurant in the hipster Sydney suburb of Newtown in 2006.

Until then, most Australians were chomping down store-bought El Paso and weren’t aware how authentic Mexican used ingredients such as black beans, pork shoulders, beef brisket, tomatillos and a galaxy of differently flavoured and smoked chillies.

New Yorker Steven Marks decided Australia was the perfect launchpad for his Mexican fast food empire Guzman y Gomez. Picture: Supplied by Guzman y Gomez via NCA NewsWire

Australia’s Mexican restaurants focused on Corona beer and the food was an afterthought, Mr Marks said.

“I fell in love with Australia … and everywhere I went, the restaurant was packed but the food was horrible,” he told NCA NewsWire.

“So I was like ‘wow, the Australians want to love Mexican food and I think if they get the fresh Mexican food that I knew, they would love it’.

“Lucky for me, where I grew up in New York, I grew up with so many Latins.”

The energetic businessman, who named the chain after his childhood friends, says Australians already had a love of fresh, interesting food through their love of Asian cuisine.

So he tracked down virtually “every Mexican in Sydney” to help get that first venture started and credits being obsessed with detail the key to the chain’s success.

Mr Marks says chicken burritos are the chain’s most popular delivery item around Australia.

“The ingredients were better and everything was cleaner and more simple, and even though I was losing a fortune early on, we never compromised on what the culture of what GyG was,” he said.

“Eventually, I think people realised the guacamole was so fresh and we had the best corn chips in the world – 21 different versions I’ve had of this corn chip. Gotta make them a little bit thinner; I want to cut with water knives so they bubble a little bit more.

“I want every crunch to have personality.

“When you’re so fanatical about the way the avocados are conditioned and only want roma tomatoes … when you have a lot of soul for what you do, people feel it.”

Mr Marks says he paired that ingredients obsession with a fanaticism with “numbers and speed”, resulting in systems that gave diners a wait time “as quick as McDonald’s … but the food was different”.

“I’ve been saying for years and people just always think I’m crazy … who says fast food had to be bad food?

Drive-through is a big focus for Guzman y Gomez. Picture: Supplied by Guzman y Gomez via NCA NewsWire

“These traditional guys, they compromise on quality just because they knew that people were time-poor, they needed value and to make themselves more profitable … and it’s wrong.

“There’s more people than ever that are cognisant of the quality of the foods that they’re eating.

“People are tired of eating traditional fast food and feeling crappy. You feel like sh**, right?

“Now they have another choice. And as a food company you have a social and a moral obligation to feed your guests proper food.

“And I think we’re getting rewarded for that.”

Indeed – even during the pandemic, GyG has not been forced to lay off any staff and has booked higher revenues, Mr Marks says.

Globally, sales revenue reached $440m last financial year, with the best performing drive throughs in Australia raking in more than $170,000 per week.

There are about 160 Guzman y Gomez around the world, mainly in Australia, but 300 are planned for the US in the next five years. Picture: Supplied by Guzman y Gomez via NCA NewsWire

About 30 per cent of sales are made through the multitude of food delivery services GyG partners with.

“I’m a huge fan of these aggregators,” he said.

“Without these drivers, what would you do?”

Of the roughly 160 GyG restaurants, 20 are outside Australia – 15 in Singapore, four in Tokyo and one in the US in Neighborville near Chicago, which opened in January.

“Hopefully in the next six weeks we’re going to announce a major deal in the US,” he said.

“The goal for us in the US is to have about 300 restaurants in five years, all drive-through.”

Mr Marks said 35 new restaurants would open around Australia by the end of this year.

And while most of the existing 140 Australian restaurants were on the east coast, there was lots of upside on the west, he said.

Guzman y Gomez slashed the price of burritos and bowls during lockdowns across all stores. Picture: Supplied by Guzman y Gomez© via NCA NewsWire

Originally published as American dynamo chose Australia for Mexican empire start to combat ‘crappy’ incumbents