Shake Shack to open first China location in Hong Kong

Shake Shack to open first China location in Hong Kong
PHOTO: Reuters

Shake Shack Inc., the fast casual restaurant chain known for their burgers and fries in the United States, is headed towards Hong Kong in 2018.

The company plans to open a total of 14 locations in Hong Kong and Macau by 2027, according to a report by Bloomberg.

The Hong Kong location will be operated by licensing partner Maxim's Caterers Ltd., which also operates the Cheesecake Factory in China.

Shake Shack hopes that the upscale burgers and fries will appeal to fast food lovers there.

"You're seeing changing preferences for what was traditional fast food," said Chief Executive Officer Randy Garutti.

"There's a continued thirst for great brands and a premium level of food at an approachable price," he added.

While about 90 to 95 per cent of the menu will be the same as in the US, the CEO revealed there may be more chicken items on the menu in Hong Kong, said Eater.

However, the expansion may be a sign of trouble at home.

Despite the chain's upscale image, a recent report from Bloomberg found that the chain is suffering from a lack of customer loyalty in the US.

The data reveals that though the upscale burger chain has more prestige compared to brands like Subway and Chick-fil-A, its higher prices may be preventing customers from ordering as often.

According to the New York Business Journal, same-store sales fell 2.5 per cent during the last quarter and the company's shares has declined 3 per cent this year.

But Garutti isn't concerned: "We feel like every day we're barely getting started," he said in an interview with CNBC.

Furthermore, Shake Shack has a couple of solutions up its sleeve, like the recent launch of an app that increased average order size by 15 per cent, the Wall Street Journal reported.

Aside from China, the burger brand plans on expanding more in general - both globally and at home. Garutti is aiming to have at least 450 shacks in the US alone.

But for now, customers in Hong Kong can expect to get a taste of the upscale shakes, burgers, and fries in the upcoming year.

thanhb@sph.com.sg

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