BUSINESS

The Spanish chain that's taking its brand of tapas to the United States

100 Montaditos has seen success at home thanks to its cheap and cheerful model

A branch of Spanish chain 100 Montaditos in Florida, in the United States.
A branch of Spanish chain 100 Montaditos in Florida, in the United States.

The formula could not be simpler: bite-sized freshly baked rolls with dozens of options for fillings, all washed down with chilled beer: a montadito and a caña. This particular dynamic duo comes in at just four euros. On Wednesdays practically everything served comes at the price of just one euro.

The cheap and cheerful combination to be found in any of the 225 bars belonging to the 100 Montaditos chain has proved a huge success in recession-hit Spain over the last decade, with the Madrid-based business doubling the number of its restaurants since 2007. The company's plan is to once more double that number in Spain by the end of 2014.

Now, Restalia, the company behind 100 Montaditos, is poised to repeat its success in the United States, where it already has a foothold, with nine outlets in Miami. It has signed franchise deals to open 100 more along the east coast this year, and is aiming to set up a further 500 establishments throughout the country by 2015. The group is also expanding into Latin America and Europe, where it intends to expand at a similar rate.

The company already has a foothold in the United States, with nine outlets in Miami

Founded in 2000 by José Maria Fernández Capitán, 100 Montaditos has spread throughout Spain's major cities, in large part through word of mouth and social-networking sites such as Facebook and Twitter. It manages to keep its prices low thanks to its high volume of purchases with its suppliers.

Juan Gerás, Restalia's CEO in the United States, says 100 Montaditos will be a global brand. "Growth has been very quick, but also very ordered. We are starting to see good results because we have planned this very carefully."

"People are having a hard time making ends meet," says Mauricio Paschold, its Miami-based director of international market development. Diners are looking for an inexpensive, healthy meal, and 100 Montaditos thinks it can fill that void.

It keeps prices low thanks to a high volume of purchases with its suppliers

Recognizing that American tastes are different, franchises in the states have adjusted the menu accordingly. Besides the traditional cured ham, smoked salmon, vegetarian and cheese montaditos, outlets in Miami offer pulled pork and burger montaditos - that said, they are garnished with hot brava sauce, retaining a Spanish flavor.

In the United States, 100 Montaditos will expand by franchising, except for the company owning one or two training outlets in New York and Miami. Depending on location, investors in Florida will spend between 200,000 and 400,000 euros to construct and open an outlet.

Miami was chosen as the launching pad because of its large Latino population and multicultural mix. Outlets are open from 10am until 11pm and include music, marble tables, and a Spanish atmosphere that will help attract its target diners, aged 21 to 35.

Miami was chosen as the launching pad because of its large Latino population

According to an August study conducted by US restaurant industry research firm Technomic, ethnic food options are growing in popularity among consumers. The study found that 77 percent of consumers polled said they would purchase ethnic food and drinks away from home at least once a month. And that number jumped to 88 percent among Hispanics - a trend that could bode well for 100 Montaditos' growth plans.

Gervás says the fact that there are few fast-casual Spanish restaurant options will help to fuel 100 Montaditos' growth in the United States. All of the company's future expansion will likely be conducted through franchise agreements.

The restaurants are built to resemble 19th-century Spanish taverns, and the whole concept for the chain, Gervás says, is based around that of a taberna - a place where people can gather, be sociable and dine together.

The restaurants are built to resemble 19th-century Spanish taverns

"It's fast casual, yes; but it's also a place where friends and family can enjoy a meal together," he says.

The 100 Montaditos chain was already a success in Spain before the crisis hit, but it has taken off as the economy has worsened. Half of young Spaniards may be without a job, but they aren't staying at home in the evenings. The chance to meet with friends for a couple of drinks and a bite to eat for under 10 euros has proved hugely popular. That said, Gervás insists the company aims to appeal to a broader public. "We have children's menus, and we don't depend on people drinking."

The company doesn't publish its financial results, but media reports indicate that a typical outlet in the center of Madrid generates up to 215,000 euros a month. The company's profits will likely be hit by the government's recent sales tax hike, which 100 Montaditos has decided not to pass on to its customers. The company employs some 4,500 people, with a team of around 20 staff for each outlet.

To order, customers fill out a paper menu with their name and their choice of montadito and drink, then turn the filled-out slip to a cashier and pay. The company is now working on an app that will allow customers to order ahead of their arrival by cellphone, thus reducing waiting time, and allowing for a faster turnover.