The Pancheros Franchise Story
How a brand rose from humble beginnings in a college town to one of the most beloved Mexican Fast Casual brands in the country
When Rodney Anderson opened the doors to the first Pancheros restaurant in Iowa City, he knew that the location was perfect. Positioned directly across the street from a university and located right next door to several popular bars where students go to unwind and have fun. This was in 1992, and Mexican food was far from the mainstream staple it is today. Rodney was betting everything that when the students tasted his Chicago-style burritos, his business would become a hit.
“We founded Pancheros in 1992, right across the street from a university, serving a lot of college kids,” says Rodney Anderson, President and founder of Pancheros. “We started serving burritos because that is what my friends and I grew up with. We would go to Chicago and experience these really authentic taquerias that we didn’t have here in Iowa when we were growing up. We found that this food was extremely popular with young people and we wanted to bring the experience back to Iowa. We secured our first location, a beautiful brick building from the 19th century, and it’s still there today. I’m very proud to say that the business is just as popular now as it was when we started. It’s become something of a tradition for the students to eat at Pancheros.”
Pancheros graduates from a business serving college kids to an innovative Mexican Fast Casual restaurant
After the first Pancheros became a hit, Anderson recognized that the concept was strong enough to begin expanding beyond the college market. Soon, Pancheros was in multiple cities and towns in Iowa, Illinois and Michigan – and as this was happening, Mexican food was rising in popularity across the country. Anderson didn’t have to explain what burritos were to his customers any longer, nor did he have to explain that the ingredients were high-quality and that everything was made fresh in-house. The customers came because the food was delicious and so Anderson set about the task of taking the concept to the next level.
In 1998, Pancheros introduced the tortilla press to its restaurants. This remains a key differentiator between Pancheros and the rest of the Mexican fast-casual chains. Customers watch as homemade dough-balls transform into perfectly pressed tortillas for the tacos and quesadillas. The freshness of the finished product is apparent just as much from taste as it is from touch, as Pancheros’ burritos are so structurally sound that they stand up on their own. Ten years later, Pancheros introduced the “Bob” tool, which perfectly mixes the ingredients together before the burrito is rolled up, ensuring that the customer gets a perfect bite every-time.
At the same time that Pancheros was finding new ways to heighten the food experience, Anderson and his team were working on simplifying the concept so that the brand could expand by franchising the concept.
“We spent several years proving the business model, and sought to find ways to simplify the concept so that franchisees could successfully implement the model and then replicate it, in order to help them scale up to multi-unit ownership,” Anderson says. “We developed great systems, built a great training platform, created exceptional marketing support and real-estate support teams, and we really have outstanding unit economics. This is a simple business and our franchisees thrive with us because all they have to do is follow the model that we’ve proven in 30 years in business.”
The future of Pancheros is brighter than ever before
After 30 years in business, Pancheros is ready to expand our cult-following on the national scene and continue our ability to grow smart and effectively. The strategies that Anderson and the Pancheros executive team established to simplify the business model has created opportunities for entrepreneurs to realize their dreams of owning a Mexican restaurant in their communities. Today, Pancheros has 74 restaurants in 13 states – and while that growth is impressive, the majority of it has been organic. Entrepreneurs would come to Pancheros, try the food, and would leave ready to open Pancheros in the markets where they live.
“One of the things that is different about our brand is that we grew from Iowa,” Anderson says. “We grew from smaller markets and out into the rest of the country. We didn’t have the opportunity to not be efficient, to not offer an exceptional product, simply because there weren’t a lot of people around. We had to get everything right and build our reputation one person at a time. As a franchisor, it makes me feel enormously proud that we have helped so many entrepreneurs realize their dreams and that our model allows them to thrive in business. As we continue to grow, we’re looking forward to welcoming more entrepreneurs into the Pancheros family. This is an exceptional brand and the potential to do well is enormous.”