El Pollo Loco announced on November 4, 2024, that its new restaurant prototype is designed to reduce buildout costs significantly. The new design aims to lower construction expenses from $2.2 million to $1.8 million per unit.
This cost reduction is attributed to the prototype's efficient design, which includes furniture upgrades and energy-efficient hoods and HVAC systems. These improvements are expected to enhance operational efficiency and profitability for new locations.
The ability to reduce buildout costs is a key factor in accelerating the company's unit growth strategy. Lower capital expenditure per unit can improve cash-on-cash returns and make franchise expansion more attractive.
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