Sunday, November 8, 2015

Shake Shack Sales Growth a True Take-Out Success

By now you have heard that Same-store sales at Shake Shack soared in the third quarter, rising 17.1 percent year over year. Those are sector leading numbers simply put took out the competition in the better for you burger sector.  Net income at the burger chain rose to $1.5 million, up from $0.5 million during the year-ago quarter, on revenues that increased 67.4 percent, to $53.3 million.  

Total revenue increased 67.4 percent in the quarter to $53.3 million from $30.2 million due largely to those same-store sales and new restaurant openings, including four in the quarter and 12 for the year.
CEO Randy Garutti said in a statement. “The third quarter marked another strong quarter in terms of same-Shack sales growth, as we continued to execute on our strategic plan and drive engagement with our guests,” He noted that the company expects to open at least 14 new locations next year. “We remain well positioned for continued success as we capitalize on our unique development opportunities.”

Shake Shack plans to enter four new markets next year, including West Hollywood, Calif., Scottsdale, Ariz., Phoenix and Dallas where consumers like Eating-Out while Eating-In according to Foodservice Solutions® Grocerant Guru®. From the beginning Shake Shack focused on the customers and build in Take-Out options to help drive unit sales.  It has worked and continues to drive top line sales and bottom line profits.  

In fact Shake Shack net income in the quarter tripled to $1.5 million or 10 cents per share from $500,000 or 2 cents in the same period a year ago. Restaurant-level operating profit more than doubled to $15.6 million from $7.6 million in the same period last year. And restaurant-level operating profit margins increased 530 basis points to 30.4 percent of revenues due to lower food costs and leverage on labor because of higher sales.

Success does leave clues and the “better for you” burger sector is no exception as Shake Shack growth in top line sales and bottom line provides all the proof one needs to understand that Ready-2-Eat fresh prepared food does drive customer adoption.  That is our Take-Out clue of the day. 

Foodservice Solutions® specializes in outsourced business development. We can help you identify, quantify and qualify additional food retail segment opportunities or a brand leveraging integration strategy.  Foodservice Solutions of Tacoma WA is the global leader in the Grocerant niche.
Contact Call: 253-759-7869 

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