[SHOCKER] Franchise Taco Chain Fails After Just Nine Months in Decatur

Rusty Taco has closed its Decatur location after less than a year in business.  The quick-serve restaurant, located in a roughly 2,500 square foot retail space at Modera Decatur (163 Clairemont Avenue), opened December 12, 2024, and closed as of Saturday, September 13, according to locals in the area.  

Employees and customers were reportedly given a 48 hour notice of the impending closure.  

While unfortunate, the restaurant's closure comes as little surprise given its location off the square, limited brand awareness, and the competitive landscape for tacos.  Add to these issues the fact that Rreal Tacos, an Atlanta-based taco shop, opened a Decatur location of its own just off the square this past February.    

The Decatur outpost of Rusty Tacos was the Dallas, Texas-based franchise's second unit in metro Atlanta.  The first opened at the Publix-anchored Summerhill Station near the old Turner Field last July.  As best we can tell, the brand did virtually zero marketing or advertising in metro Atlanta, which as a new-to-market brand is a huge misstep.  

Rival taco spot Torchy's, which unlike Rusty is fairly well known, entered the Atlanta market last August with an existing cult-like following, did a fair amount of marketing, including at least one billboard near Atlantic Station ahead of and following their opening.  The Austin-based chain also opened in West Midtown, which shortly thereafter became ground zero for restaurant closures, but the taco spot has found a following.  

MBC Concessions, the local franchisee behind Rusty Taco's expansion, was to have opened as many as ten locations of the taco joint in metro Atlanta.  As its name suggests, the franchisee is an experienced operator of restaurants at several airports, but Rusty was seemingly the group's first non-airport endeavor.  

“As we continue to grow in the Atlanta area, Decatur stood out as the perfect community to bring Rusty Taco to next,” said Justin Triplett, President and CEO of MBC Concessions ahead of the Decatur opening. “The unique menu with multiple dayparts and unmatched flavor profile presents a fantastic opportunity for the market. We can’t wait for the new restaurant to be a staple in the Decatur community and serve guests in the market for years to come,” Triplett added. 

Brands like TGI Fridays and Uncle Maddio's Pizza can thrive in airports because of the captive audience they enjoy, as well as the limited competition that exists.  Operating a standalone restaurant in an intown market like Decatur is basically the exact opposite of operating a restaurant in an airport.   

Also worth noting, Rusty Taco was once owned by Atlanta-based Inspire Brands, an affiliate of Atlanta-based private equity firm Roark Capital, but was sold to Gala Capital Partners (GCP), an investment firm focused on "emerging restaurant franchise brands," in December 2022.  The brand was then, as it is now, a 32-unit chain.  This stagnant unit count reflects a net gain of zero stores in a roughly three year period.   

The Summerhill location remains open for now, but sources suggest it, too, is underperforming expectations.  Rusty Taco seems destined to follow in the footsteps of other taco chains that have closed some (Chronic Tacos) or all (Capital Tacos) of their Atlanta area locations.   

Did you ever eat at Rusty Taco in Decatur?  Are you surprised to see Rusty Taco close?  What would you like to see open in place of the former Rusty Taco in Decatur?

Please share your thoughts below.