Wahoo’s Fish Taco is a franchise organization that offers Mexican food mixed with Brazilian and Asian flavors. It is a “fast-casual” restaurant that was founded in Costa Mesa, California, in 1988 by Chinese-Brazilian brothers Edurado Lee, Mingo Lee, and Wing Lam, who mixed traditional Chinese and Brazilian flavors with dishes they encountered traveling in Mexico.
The first Wahoo’s Fish Taco restaurant was started to combine the brothers’ love for surfing and food.
Wahoo’s is now just over 20 years old and has about 50 locations, primarily in California, Texas, Colorado, and Hawaii. Although it’s been very successful, it couldn’t be characterized as a “rapid growth” franchise system.
Instead, the founders have elected to make Wahoo’s Fish Taco a relatively slow growth system, focusing on branding and service quality rather than rapid growth.
This philosophy has been an entrenched part of the way Wahoo’s Fish Taco has done business since the beginning.
It started with a single restaurant in 1988; the second unit was added only when the founders had saved enough money to build it debt free. This pattern has characterized the company’s growth. Early on, it only added one new restaurant a year, then two, then three, and so on. Despite its success, it has averaged only about 2.5 restaurants per year since its founding. For many years, the company only sold franchises to people the founders personally knew and trusted.
Wahoo’s Fish Taco has now adopted a somewhat more aggressive philosophy toward growth, although its core values remain the same. In 2009, the company hired Tom Orbe, a business professional, to accelerate its growth plans. It plans to add 100 locations in the next five years. The expansion is motivated by the company’s strong financial position and also by the increased availability of prime locations at reasonable prices, which is fallout of the recent recession. The company anticipates receiving a large number of inquiries for the additional 100 locations. It plans to apply four criteria to selecting franchises:
passion for the brand, community involvement, restaurant experience, and financial capacity. Consistent with Wahoo’s Fish Taco’s history, locations will only be offered in select areas, and no international expansion is immediately planned.
Along with its staple dishes, which include fish tacos, enchiladas, burritos, and salads, Wahoo’s Fish Taco’s offers many vegetarian and vegan options, such as tofu, banzai veggies, and brown rice.

Questions for Critical Thinking
1. What are the advantages and disadvantages of Wahoo’s Fish Taco’s slow growth philosophy of franchise expansion?
2. Spend some time looking at Wahoo’s Fish Taco’s Web site, focusing particularly on its menu and its store layout. Do you think the business is well-positioned or poorly positioned to take advantage of current trends in the types of restaurants that are doing well and food preferences? Explain your answer.
3. Wahoo’s Fish Taco anticipates a large degree of interest in the 100 franchises that it plans to award over the next five years. Does the company risk “leaving money on the table” by placing an arbitrary 100 on the number of franchises it plans to add? If you were advising Wahoo’s Fish Taco, and the company received applications from 200 rather than 100 highly qualified candidates to open Wahoo’s Fish Taco franchises, would you advise the company to stick to 100 or to allow 200 new franchise locations to open?
4. Evaluate Wahoo’s Fish Taco’s four criteria for selecting franchises. Do you think these are appropriate criteria?
If you were asked to suggest a fifth and a sixth criteria, what would they be?