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Dallas-based food chain to accept Mexican pesos

10:11 AM CST on Saturday, January 6, 2007

By KAREN ROBINSON-JACOBS / The Dallas Morning News

Starting Monday, patrons of the Dallas-based Pizza Patrón chain, which caters heavily to Latinos, will be able to purchase American pizzas with Mexican pesos.

Restaurant experts and economists said they knew of no other food chain with locations so far from the Mexican border offering such a service.

"We're trying to reach out to our core customer," Antonio Swad, president of Pizza Patrón Inc., said Friday.

"We know they come back [from Mexico] and have pesos left over. We want to be a convenient place for them to spend their pesos."

While U.S. restaurant chains have stepped up their marketing to Latino consumers and incorporated Latin flavors in the menu, it's unusual to see that outreach extend to the cash register.

"I think it's a very interesting idea," said Ron Paul, president of Technomic Inc., a Chicago-based restaurant market research firm. "They are catering to that audience."

But Mr. Paul said he did not see other chains rushing to emulate the program, in part because of bookkeeping headaches.
Usefulness

Others mentioned that the growing use of credit cards and the desire to hang on to the pesos for a return trip to Mexico would dilute the usefulness of the program.

"If you're not in a border town, I don't see the functional benefit," said Juan Faura, president and chief executive of Cultura, a Dallas-based marketing and advertising firm.

He and others saw the program more as a marketing effort than a badly needed service.

"I would see it as a move by the chain to communicate unequivocally to the Hispanic market that they are for them," Mr. Faura said.

"I don't see any other reason for it."

But Andrew Gamm, Pizza Patrón's director of brand development, said the company tested the idea in a Mesquite store recently and had customers spend "a couple hundred pesos," without any advertisement of the service.
Bills only

Under the program – which is set to end in late February but may be extended – the chain's 59 stores will take peso bills only, not coins.

Using cards listing the conversion calculations, cashiers will enter the figure in U.S. dollars into the cash register and give the change in U.S. currency.

Mr. Swad said some franchisees have made arrangements with their banks to handle the currency.

All other franchisees can send the pesos to the corporate headquarters, which will go to a third party to handle the conversion.

Mr. Gamm said the company set its exchange rate at 12 pesos per dollar for the duration of the program. As of Friday's trading, 10.94 pesos were worth $1, according to Bloomberg News.

Mr. Gamm said the difference would cover the cost of getting the pesos converted to dollars.

Mr. Swad said he's prepared to take heat from American consumers who might be offended by the bypassing of greenbacks.

"We're not really interested in finding the safest spot on the board," Mr. Swad said.

About 60 percent of Pizza Patrón customers and 45 percent of the franchisees are Latino.

"We know the purity of our intention, and we're willing to take the heat when there is heat."