Where to Get a Shake Shack Burger for Less Than $5
(Bloomberg) -- If you’re looking for the cheapest ShackBurger on the planet, you’ll need to head for the Philippines.
Shake Shack Inc. made its debut in Manila on Friday, with the best-selling ShackBurger going for 250 pesos ($4.79) in the New York chain’s first Manila store. That’s about a dollar cheaper than in Manhattan, while the cost in Singapore is $6.75. Chief Executive Officer Randy Garutti said they “priced as aggressively as they could” to break away from the premium dining segment and build a customer base in a country where the average annual income is $3,660.
“We are more committed to building a great brand and a busy restaurant,” Garutti said in an interview ahead of the store’s opening. “Profit margins tend to take care of themselves over time if you do that.”
Local partner SSI Group Inc. is optimistic it can manage operating expenses to avoid putting pressure on margins for its largest investment in a food business to date, President Anthony Huang said. SSI, the largest retailer of luxury brands like Hermes, Prada and Gucci in the Southeast Asian nation, has also expanded into dining through SaladStop! and TWG Tea.
SSI, whose stock has jumped 77% since the partnership was announced last year, is counting on resurgent consumer spending and cooling inflation to drive demand for Shake Shack’s “fine casual” dining, Huang said. Demand was clearly strong on Day One, with queues winding around the block and the first customer lining up 12 hours before the store opening.
“I think people are pleasantly surprised at the price points we have,” Huang said.
- The burger chain is expanding in Asia as the U.S. market becomes saturated. The Manila branch is its 26th in Asia, its fastest-growing region worldwide. It opened stores in Shanghai and Singapore earlier in the year.
- Garutti expects Asia to be Shake Shack’s largest international presence in the future, overtaking the Middle East, Turkey and Russia.
- SSI is “hopeful for another good year” after profit jumped 121% in 2018, driven by lower operating expenses and higher efficiency gains from its store rationalization: Huang. It plans for capital expenditure of 900 million pesos for 2019, double that of last year, Huang said.
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