UV7074 Rev. May 24, 2017 Pancho’s Burritos It was Friday night, and Francisco “Pancho” Escoba, manager and owner of high-end fast-food restaurant Pancho’s Burritos, was performing his regular restocking order when he noticed something odd. As he walked into the restaurant, he saw a number of customers walking out, frustrated with the long lin

UV7074
Rev. May 24, 2017
Pancho’s Burritos
It was Friday night, and Francisco “Pancho” Escoba, manager and owner of high-end fast-food restaurant Pancho’s Burritos, was performing his regular restocking order when he noticed something odd. As he walked into the restaurant, he saw a number of customers walking out, frustrated with the long line that spread all the way across the restaurant. Customers leaving at the sight of a long line during peak demand hours was a recent trend that worried Escoba. In order to put an end to the fleeing customers and to improve the customer experience, Escoba decided to analyze his operations by taking some time studies of the burrito-making process.
The Arrival of Pancho’s Burritos
Escoba was born an entrepreneur. At age 12, he started his first business, a home movie theater that served his friends and family. By age 16, he owned and operated a number of small businesses in his hometown of Guadalajara, Mexico, including a lawn-care service, a neighborhood food-delivery service, and an airport-ride service. Due in part to the stable income he received from his businesses, he was able to attend and pay for college at Universidad Panamericana. Following graduation, he returned to Guadalajara where he started a furniture design, manufacturing, and retail store. After laboring for several years just to break even, he decided to return to school for his MBA at the University of Virginia’s Darden School of Business.
During his first year at Darden, Escoba would regularly have friends over for dinner. He would always make them burritos using his grandmother’s secret recipe. His friends could not get enough of the burritos. After seeing his friends’ reactions, Escoba realized he might have the makings of another entrepreneurial venture. He knew that there had been a recent boom in the fast-food industry, but most of the establishments were serving unhealthy, overprocessed food. Escoba believed there was an opportunity to provide high-end fast food for price- and health-conscious consumers. In 2011, Escoba founded Pancho’s Burritos in Charlottesville, Virginia. Since its opening, Pancho’s Burritos had become a local mainstay, growing immensely popular, especially with students at the University of Virginia.
Analyzing the Operations
Although Escoba was thrilled to see his business thriving, he was worried about customers leaving due to the long wait times. So immediately after walking into the restaurant, Escoba grabbed a notepad and went to the floor to understand what was going on. He spent the night observing each of the five employees involved in the burrito-making process and taking data on a set of sample orders. His hope was that the time- measurement data would help him increase the number of burritos per hour that the burrito-making process could yield while at the same time maintaining a high-capacity utilization for the process (Exhibit1).
This case was prepared by Daniel Dorronsoro (MBA ’16) under the supervision of Tim Kraft, Assistant Professor of Business Administration. It was written as a basis for class discussion rather than to illustrate effective or ineffective handling of an administrative situation. Copyright © 2015 by the University of Virginia Darden School Foundation, Charlottesville, VA. All rights reserved. To order copies, send an e-mail to sales@dardenbusinesspublishing.com. Nopartofthispublicationmaybereproduced,storedinaretrievalsystem,usedinaspreadsheet,ortransmittedinanyformorby anymeans—electronic,mechanical,photocopying,recording,orotherwise—withoutthepermissionoftheDardenSchoolFoundation.