The Real Reason You Don't See Chi-Chi's Restaurants Around Anymore

Although Chi-Chi’s itself is long gone in the United States, vanished in a perfect storm of financial mess and food poisoning, it has left behind it quite a legacy. Let’s celebrate the silliness that was Chi-Chi’s, and figure out why they disappeared.

The businessmen who dreamed up Chi-Chi’s actually had a pretty solid idea in the beginning. It was the 1970s, and Mexican food options were pretty nonexistent. Even Taco Bell hadn’t gone nationwide at that point. A group of Minnesota entrepreneurs felt the time was right for a sit-down Mexican restaurant in the Midwest and at first, their profits went way beyond their expectations. That first year in business, they took in $2 million — five times their projected revenue. Things were looking good, and it seemed like the sky was the limit for America’s new favorite chain.

Naturally, success like that does not escape the ever-watchful eyes of big money investors. Within a few years, the franchise operation was bought out, and control was given to one of the bigwigs at Kentucky Fried Chicken. While he moved company headquarters from Minneapolis to Louisville, the chain’s expansion in the ’70s and early ’80s remained centered on the Midwest.

Those Midwestern restaurants remained quite successful, mostly due to the fact that they faced little or no competition or expectations when it came to Mexican food. But when Chi-Chi’s tried expanding into other markets like New York and Miami, they just didn’t catch on. Their failures in Texas, California, and New Mexico were, perhaps, to be expected, but when Chi-Chi’s failed to take hold even in New England or the deep South, it started to seem like the fiesta might be starting to wind down just as it was getting started.

Watch the video to learn the real reason you don’t see Chi-Chi’s restaurants around anymore!

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