How Five Guys Got Us Eating Its Burgers
"We're fortunate in the fact that we don't have to keep remaking ourselves. We've got the same menu since 1986," he says. That keeps it simple. "We're not doing any vertical integration. We don't have our own trucking company or our own meat companies. We're using big national companies that can do that for us."
There are plenty of players looking to make their mark in the better burger segment. Besides Five Guys and In-N-Out Burger, small establishments such as Smashburger, Elevation Burger and Mooyah are growing exponentially.
"We think there is room on a national level for two or three major players in the better burger category," Smashburger CEO Dave Prokupek says.
Smashburger has opened more than 100 units in 30 states in four years. The company plans to open another 80 stores this year. Prokupek says product aside (the company also emphasizes its freshness), the ability to open franchises efficiently will fuel the company's growth."There's not that many fast-casual food concepts whose build-out cost is $400,000 to $450,000," which includes smaller-square-footage stores and cost-effective marketing that incorporates a social media strategy, he says. Investors are looking for ways to place bets on the segment, but at least one observer worries about the sustainability of growth at franchised companies such as Five Guys. "Sometimes when you're getting in on a concept that is rapid growth, you're buying because other people are buying. It's kind of like the stock market.
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