Canadian Tex-Mex Restaurant Chain Burritobar Signs Master Franchise Agreement for New Jersey

Burritobar, the American sister company of Toronto-based Tex-Mex chain Barburrito, is looking to make a splash in New Jersey as part of a nationwide expansion effort.

Under a recently signed master franchise agreement with Sarang Franchising LLC, the fast-casual brand will launch 93 restaurants across the Garden State over the next two decades.

Founded in 2005, the concept offers healthy, fresh, made-to-order burritos, bowls, nachos, tacos and quesadillas. Since launching a franchise program in 2009, Barburrito has grown to over 325 locations across Canada.

In 2020, the brand expanded to the United States under the name Burritobar. It now has three locations in Michigan and one in Delaware.

The New Jersey deal comes about two months after Burritobar awarded Sarang a 115-store development contract in Ohio. The brothers behind Sarang, Tushar and Yogesh Patel, relocated from Philadelphia to operate and now run several Dunkin’ franchises in the Midwest.

A “big” market

Jeff Young, Burritobar’s Chief Development Officer, said of the latest agreement with Sarang: “New Jersey is a great market. Geographically, it fits perfectly with our East Coast development strategy and, with a population of over 9 million, it represents a market with significant growth potential. For these reasons, we have received significant interest from potential master franchisees for the New Jersey territory.”

“Organic expansion with existing franchise partners has always been a key pillar of growth and when the Patels expressed interest in expanding into this market, we were thrilled. Tushar, Yogesh and their team know the region very well, so it was a no-brainer for them. For us, the fact that they secured the master franchise rights for the state of Ohio in May of this year and then secured the master franchise rights for the state of New Jersey a month later is a very strong validation of the brand and business model. We are thrilled that Tushar, Yogesh and their group are as excited as we are about the future of the brand,” Young told NJBIZ.

He added, “Burritobar is experiencing explosive growth in the U.S. market and our accelerated franchise program has delivered remarkable results with master franchise agreements signed in Michigan, Florida, Virginia, Maryland, Tennessee, Iowa, Nebraska, North Texas, Southern Illinois, Ohio and now New Jersey… Additionally, through our regional developer model, we have awarded multi-unit franchises in Hawaii, Houston, Connecticut and Cincinnati.”

Healthy competition

Burritobar is poised to become a major player in the Mexican fast food market. It currently has 750 development commitments in the United States

Its competitors include Chipotle and Qdoba, which have 3,400 and 750 locations, respectively. New Jersey-based Bubbakoo’s Burritos is also making a name for itself. Since 2008, it has opened more than 100 restaurants in 16 states.

Young explains, “People who aren’t familiar with the brand often wonder how the concept compares to Chipotle. While both brands offer burritos, bowls, tacos and quesadillas, there are more differences than similarities. From a menu standpoint, we have a lot more options, including more proteins, more toppings and more sauces to choose from.”

“In addition, we have fryers, which allows us to offer a more diverse offering, including signature dishes such as bang bang shrimp, crispy chicken, falafel, extreme fries and freshly fried churros. On top of that, we pride ourselves on serving fresh and delicious Mexican food,” he said.

Another difference between Burritobar and other players in the category is the physical space itself, Young noted.

“Chipotle units are typically freestanding buildings of 2,200 to 2,400 square feet, often with a Chipotle aisle. While Burritobar units are much smaller, in the 1,000 to 1,500 square foot range, and are typically inline or end-of-line spaces located in outdoor shopping centers. The smaller format reduces upfront capital expenditures, and with our lower ongoing operating expenses and low-labor model, our franchisees benefit from a faster path to profitability,” he said.

As the brand builds its presence in the U.S., Young said it plans to open a U.S. office to support growth. But for now, it’s confident it can “easily support” short-term growth from its Toronto headquarters, he said.