Shake Shack aims for major expansion to rival Five Guys with 1500 locations in the US
fool.com —
Shake Shack has announced a significant increase in its long-term goal, aiming for over 1,500 company-owned locations in the U.S., up from an original target of 450. This expansion would make it comparable in size to Five Guys. The company currently operates around 310 locations, with plans to open more in suburban areas. However, management acknowledges that these new locations may have lower sales volumes, potentially impacting overall profitability. While Shake Shack's restaurant-level profit margins are strong, its overall profit margin has declined to just 3%. The ambitious growth plan poses risks, as increased locations could further strain profits despite the potential for higher revenue.