If you ask the average person to name their favorite fast food chain, you’re likely to get one of a few answers: McDonald’s, Chick Fil A, or Taco Bell.
While all three have been around for quite some time, each also seems to have its own diehard fanbase, which helps a lot when it comes to debuting new items and keeping people coming back time and time again.
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Depending on where you ask people about their favorite chains, though, you may get a different answer. Asking in California, for instance, you might hear “In-n-Out Burger” or “Del Taco” when you ask that question.
Related: Classic fast-food chain closing hundreds of locations
Both chains were big on the west coast first, and while they’re appearing in more locations these days, they were once more exclusive to a certain area.
Unfortunately, one of these regional faves is now in a situation that could mean bad news for the company.
A few of Del Taco’s popular items, including its plant-based tacos.
Image source: Del Taco
Jack in the Box considers a big change
Jack in the Box (JACK)   made a recent announcement that it plans to shake up its business strategy with a new plan it calls “Jack on Track.”
The company aims to move towards a franchised “asset light” model with the goal of improving long-term financial performance, per CEO Lance Tucker.Â
“Upon completion of the program, Jack in the Box expects to deliver consistent, positive net unit growth,” the company said in a press release.
Related: Whataburger finally brings back beloved menu item
A part of the plan is to execute what the company calls a “block closure,” which means it will close a chunk of its locations this year. The exact number was not confirmed, but the company estimates it to be between 80 and 120 restaurants between now and the end of 2025, with the rest closing in 2026 based on each franchise’s individual agreements in respect to termination dates.
Another big part of the plan is about Del Taco, which Jack in the Box acquired in March of 2022 for roughly $585 million. Only a few years later, Jack in the Box is investigating its options for the business by working with Bank of America Securities to explore strategic alternatives for the Del Taco brand, one of which could be selling off the business.
It’s telling that in its fiscal year guidance, Jack in the Box chose to suspend all forecasts for the Del Taco brand.
Why is Del Taco struggling?
Originally founded in 1951 in San Diego, Jack in the Box’s uniqueness came from offering burgers, chicken and tacos on its very first menu. It’s an interesting bet to make: why go to a different restaurant for each when you can have them all in one place?
Del Taco very much follows the Jack in the Box formula by making Mexican American food its main thing, but still offering cheeseburgers on the menu. That said, we’ll bet you’ve never heard a friend utter the sentence, “I had the most amazing burger at Del Taco today!”
Related: Costco puts new gourmet item on its grocery menu
The company’s conundrum brings to mind the phrase “Jack of all trades, master of none.” By choosing to try to appeal to every customer instead of leaning into one food area and specializing, Del Taco takes the risk of being perceived of as average by the everyday consumer. This could be one reason why people aren’t rushing to its locations to get that one food item they can’t stop thinking about.
