El Pollo Asado Readies Three County Outlets : El Toro, Laguna Niguel, Mission Viejo Sites Targeted by Arizona-Based Fast-Food Chain

El Pollo Asado, an Arizona-based restaurant chain, has hopes that its Mexican-style charcoal-broiled chicken will fly in Southern California despite competition from such entrenched operations as El Pollo Loco.

A local franchise agreement has been signed to develop El Pollo Asado restaurants over a three-year period in El Toro, Laguna Niguel and Mission Viejo. The three restaurants will be the first step in the Phoenix restaurant chain’s plans to open at least 80 franchises in Southern California during the next decade.

Under the agreement, Denver-based National Franchise Concepts, the chicken chain’s subfranchisor for most of Southern California, recently sold territorial rights for El Toro, Laguna Niguel and Mission Viejo. The company would not identify the franchisee. The first of the Orange County outlets should open this year, said Scott McMartin, a National Franchise vice president in Denver.

National Franchise said it also has sold rights to develop four restaurants in Riverside County in an agreement that will allow National to build its own El Pollo Asado units in the area as well.

El Pollo Asado is listed on the over-the-counter exchange and has 26 company-operated and 23 franchised units in seven states.

The chain’s menu features charcoal-broiled chicken marinated in fruit juice, herbs and spices and accompanied by tortillas and salsa. The restaurants also offer standard Mexican-American fare such as tacos, burritos and quesadillas.

Early this month, the fast-food chain reported a net loss of $1.2 million on revenues of $2.6 million for the third quarter of fiscal 1988, ended Jan. 3. That compared to net income of $43,202 on revenues of $2.7 million for the same period last year.

For the 40 weeks ended Jan. 3, El Pollo Asado’s net loss was $2.4 million, down from net earnings of $337,712 in the prior period. Revenues for the first three quarters of its fiscal 1988 period were $10.2 million, a 36% increase from $7.4 million recorded during the like period last year.

The company blamed its losses on “continuing” marketing problems with operations in Dallas, delays in the scheduled openings of new franchises and “the negative effect of the Thanksgiving and Christmas holidays on chicken sales.”

National Franchise Concepts, which has a regional office in Irvine, is privately owned. It is headed by Stephen Tucker, a Santa Monica commercial real estate developer who paid El Pollo Asado $318,000 for exclusive rights to sell franchises for Orange, San Bernardino, San Diego, Riverside and Ventura counties.

Richard B. Lipson, chairman and chief executive officer of El Pollo Asado, said that there is substantial interest in the Southern California market.

“The trend for consumption in the fast-food market is toward poultry. And the trend in general is to eat more poultry than beef,” McMartin said. “Our product has half the calories, half the cholesterol and half the fat of fried chicken. We offer a Mexican-style menu that . . . should appeal to the Southwest and health-conscious consumers.”