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Shake Shack expects slow opening pace in 2019

The better-burger concept will likely be plagued by the same problems that slowed unit growth this year.
Photograph: Shutterstock

Shake Shack, which got dinged by investors upon announcing a logjam in new unit expansion earlier this year, reported this week that it anticipates much of the same in 2019.

“We’re planning to expect the same thing next year,” Shake Shack CEO Randy Garutti said Tuesday at the Morgan Stanley Global Consumer & Retail Conference. “We’re assuming more of a back-weighted year.”

Cities are so focused on growth that permits and inspections are taking longer than anticipated, Garutti said. It’s also difficult to book contractors because they’re so busy, he said. 

“Good luck finding an electrician in the city of Seattle,” he said.

There are currently at least 10 new Shake Shacks slated to open in the final weeks of the year. Opening around the holidays is a challenge, Garutti said.

“It’s not going to be easy,” he said. “The same thing will likely happen in some form next year.”

Shake Shack, which currently has 114 company-operated fast-casual burger units, plans to open 36 to 40 more locations in 2019.

The better-burger brand has struggled in recent quarters. Earlier this month, it reported a same-store sales dip of 0.7% for the quarter ended Sept. 26, sending stock prices tumbling.

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