Final - Dorentina Rexhaj Jusufi Shake Shack

Career & Business Essentials

“Shake Shack the Top Burger”

Dorentina Rexhaj JusufiInstructor: Jodie Hirsch

“Shake Shack the Top Burger”

Introduction:

Shake Shack wasn’t always the huge burger empire that it is today. The restaurant started with a hot dog stand which appeared during the summers of 2001-2003 in Madison Square Park. In 2004 it opened in the park with a permanent structure and five years passed until it opened another location. As of December 2014, the company had 63 Shacks in nine countries and 34 cities, serviced around by 2,000 employees.

Shake Shack’s premium natural ingredients are at the center of its identity, both because of how the food tastes and because of their pedigree: 100% all-natural meat, antibiotic and hormone free, source verified, ground fresh, non-GMO vegetable produce, real sugar instead of corn syrup and milk from dairy farmers who have pledged not to use artificial growth hormones. Shake Shack plans to open at least 10 new domestic company-owned Shacks each year for the foreseeable future.

The company believes it has the potential to grow to at least 450 Shacks in the U.S. (2018, U.S. Reported).

Chapter 7

Management, Leadership, and the Internal Organization

Setting a vision:

Shake Shack Corporation adjusts its corporate mission and vision statements to respond to changes in the global foodservice industry environment. As one of the healthiest fast food restaurant national and international, the company considers its corporate vision and mission statements as essential policy and strategic management tools to ensure continuous growth. In this case, Shake Shack mission statement establishes the company as an influential fresh & 100 % organic food service destination.

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Shake Shack vision statement is a push for the company to achieve growth and improvement. Considering major international competitors like five guys burgers, McDonalds as well as smaller local firms, it is essential that Shake Shack develop competencies to strategically manage the effects of competition and to achieve business goals based on the company’s mission and vision. Shake Shack mission statement is to “stand for something good”. Shake Shack has made it a priority to integrate itself into surrounding areas. They want to spread a love for the planet that we live on while extending hospitality into the community surrounding each location. The following components of the company’s vision statement:

Stand for something good

Become an even better Shake Shack

Serve more customers delicious organic food each day around the world.

Shake Shack is designed to become part of the local neighborhood. Prospective employees are sociable, outgoing attitudes, and then given constant encouragement to connect with guests. Food is carefully sourced to maintain quality and then prepared with an exacting process to ensure a consistent taste. Employees are given extensive training and then empowered to create great guest experiences. The part of Stand For Something Good is for donating to local charities and organizing company volunteers to help feed the hungry, and clean up parks in the community.

SWOT Analysis:

Strengths

I. Shake Shack uses only the best ingredients for their burgers, hot dogs, shakes, fries. Freshly and organic 100%

II. Shake Shack is one of the most dog-friendly chains in operation. They offer by every U.S. location a dog-friendly menu too.III. Highly skilled workforce through successful training and learning programs. Shake Shack is investing huge resources in training and development of its employees resulting in a workforce that is not only highly skilled but also motivated to achieve more.

IV. Red and Shack White wines are bottled exclusively by Frog’s Leap Vineyards in Napa Valley. These quality offerings differentiate the company from many of its competitors.

V. High level of customer satisfaction

Weaknesses:

I. Financial planning is not done properly and efficiently. The current asset ratio and liquid asset ratios suggest that the company can use the cash more efficiently than what it is doing at present.

II. Long waits in lines

III. Relatively higher prices due to costs increase

Opportunities:

I. Reduce prices

II. There are opportunities for new restaurants outside the United States, and Shake Shack has been taking advantage of them. Germany is a great opportunity for the company, as is much of France.

III. More Menu options for example: salad menu

Threats:

I. The salad became a major source of food poisoning in the US, Romaine lettuce warning from CDC after E. coli outbreak.

II. The Fast Food business is competitive. These include brands like Five Guys and Smash burger in the “better burger” business that includes higher-quality burgers.

Chapter 11

Customer-Driven Marketing

The marketing mix

The marketing mix is a model of creating and implementing marketing strategies. The elements are the marketing tactics, also known as the ‘four Ps’, the marketing mix elements are price, place, product, and promotion.

1. Product:

Shake Shack uses only the best ingredients for its burgers, hot dogs, fries, and custards. Burgers and hot dogs are made from all-natural, hormone and antibiotic-free beef and chicken, while fries are made from premium golden potatoes and are prepared 100% free of artificial trans-fat. Frozen custards use only real sugar, no corn syrup, and milk without artificial growth hormones, and are spun daily on-site. Each Shack is localized with design and menu options that are intended to pique the interest of local guests. The company is also dedicated to using sustainable materials and equipment; for example, using handmade tabletops constructed from reclaimed bowling alleys. It also posts information about suppliers, sustainable sourcing, and community relationships.

2. Price:

Price range is $5 and not more than $10 for an item. It is a dining on a budget when thinking of the great value of food.

3. Place:

Shake Shack is located in more than 90 locations in the US mostly in parks and outdoor areas also international opened 12 other fast-casual restaurants: Istanbul, Dubai, London, Moscow etc.

4. Promotion:

a) There are a variety of different promotions of new flavors of the month or season.

b) Free food items from the menu for the birthday celebration (born in this day).

c) Serving a sales promotion method which makes customers save money by getting coupons easily and very simple, with this method they can have deals up to 50% discount and buy Shake Shack burgers with a cheap price on $2.

d) Donating a lot of communities. They have donations events and various campaigns that people who enjoy Shake Shack can participate.

Market Segmentation:

Shake Shack segmentation, targeting and positioning are one of the integral components of its marketing strategy. Segmentation involves dividing the population into groups according to certain characteristics, whereas targeting implies choosing specific groups identified as a result of segmentation to sell products.

Market segmentation is defined as dividing a single market into smaller segments. The basic reason for dividing the market into small segments is to make it simple to address the needs of smaller groups of customers and try to manufacture different products according to their consuming habits. Particularly it is done according to the people who have similar characteristics. It can be done on the basis of age, gender, lifestyle, region, etc. In order to develop a marketing strategy, it is very important for the company to understand its target customers. If the company can understand its customer then only it can communicate itself to their consumer market. Better you know about your consumers, more effectively you could communicate and market them. Shake Shack has segmented their products according to bases of Demographic, Psychographic and Behavioral. Shake Shack in Istanbul segmentation it has done is on three different bases:

I) Demographic Segmentation: Kids, Family, and Students

Shake Shack offers different products for families it has made different outlets and meals which are suitable for takeaways. Shake Shack has made its environment which is suitable for students of the school to hang out with their friends and can get their lunch at Shake Shack who wants fresh and organic burgers.

II) Psychographic segmentation: Convenience and lifestyle

Shake Shack has adopted itself according to the convenience and lifestyle of the Istanbul consumers, as Istanbul has a huge Muslim population so Shake Shack came up with a different and new product line which includes items like a Veggie burger and chicken spicy Burger. They also made Shake Shack as a place to relax and even for entertainment.

III) Behavioral segmentation: Occasions, for Birthday Parties of kids and adults.

Chapter 8

Human Resource Management

Selecting and Hiring Employees

Costumes are an important asset of Shake Shack because customer satisfaction begins with the attitudes and abilities of employees who are committed and effective. Shake Shack represents an ideal job opportunity for anyone interested in food service and hospitality. The chain offers fast-paced work environments allowing for exciting customer interactions. The burger chain looks for bright, friendly team members with high energy and the ability to make work fun. Only highly capable individuals earn the ability to uphold the reputation for quality food and friendly service at a participating location. Casual workers may find fun, flexible part-time jobs or work as seasonal hires during busy summer months. Committed entry-level associates may take on full-time roles and work year-round. For positions like a team member, the regional chain hires individuals without any prior work experience. The company only requires candidates to show the willingness to learn and genuine interests in the fast food industry. Shake Shack accepts paper applications and online submissions. To apply online, candidates simply need to visit the careers page on the company website and search for available opportunities. After selecting a job opening, an aspiring worker may fill out an online form, which asks for contact information, education background, past employment, and references. The hiring form also asks candidates to describe what drove initial desires to work for the restaurant as well as favorite and least favorite aspects of past jobs. Employees at Shake Shack earn competitive hourly pay and generous salary options. The minimum age requirement for employment varies by state. Packages available to qualified workers include comprehensive medical, future savings, and personal well-being plans, which all qualified associates may access. Healthcare benefits include medical, dental, and vision insurance for employees and dependents. For financial security, employment benefits packages include revenue-sharing and 401(k) retirement plans available to crew members over 21 years old who worked over one year on staff.

Motivating Employees

At the center of Shake Shack’s mission is CEO Danny Meyer’s philosophy of “enlightened hospitality”, where the idea is to create a welcoming atmosphere first for employees, next for customers, and then for the outside community. Those people are motivated by the training and development opportunities that Shake Shack offers, which is one of the reasons that they invest a lot of money on training annually. The Staff is then provided with learning and development opportunities that will assist them with their future employment, and that they can apply throughout their working lives. Opportunity is a big part of the company’s strategy to attract the best talent, employees who have an opportunity to prove their excellence, friendliness to customers and have a real future with the company.

Conclusion:

Shake Shack leads to a better burger. The rapid growth of Shake Shack from a hot dog stand, to its first restaurant in 2004, has made a change in the community. They continue their path for success by keeping their consumers in mind regarding their product selection as well as their prices. They encourage their employees to do a good job, usually promote and offer several pieces of training to encourage education. I’ve learned that modifying the product or service is one example of how foreign firms are able to distribute their goods effectively in diverse markets. Another is by modifying the businesses’ marketing mix in order to fit global resources to local market conditions in this case Shake Shack has been successful because of the value that the company gives for its customers. It also faces competitors like McDonald’s who offer less quality, but at a lower price point. The company also has competition from other chains that offer different, healthier, options, like chipotle. I believe that Shake Shack is a learning organization, one that is willing to learn and open to change. I came to the conclusion that Shake Shack has an opportunity to be a standout company, assuming quality remains a top priority and expansion initiatives going ahead as planned.

References:

“Supplemental Information 16: Statistic Analysis of Fig. 2F.” Shake Shack, doi:10.7717/peerj.3338/supp-16.

Shake Shack, Shake Shack. “Join Our Team.” Shake Shack, 2018, www.shakeshack.com/join-our-team/