Dive Brief:
- Shake Shack is planning to remodel some stores to include drive-thru lanes and walk-up windows in response to social distancing requirements, according to a company earnings call Monday.
- These "Shack Track" restaurant concepts build on the previous contactless ordering and collection additions, including pop-up drive-thrus and curbside pickup, Shake Shack rolled out amid dining room closures. CEO Randy Garutti didn't disclose how many of the chain's restaurants would be remodeled as Shack Track stores.
- “We've been studying current Shack layouts and future Shack designs in order to identify where this model can be quickly added,” Garutti said on the call. “It may take time and many forms but all towards the goal of continuing to build the community gathering places the world needs, while adding a level of convenience, safety, distance and frictionless pickup to meet the needs of our guests.”
Dive Insight:
These Shack Track store concepts will help position Shake Shack for the "new normal" likely to follow COVID-19 as states begin to ease stay-at-home orders.
“Diners and guests are looking around, and saying, ‘I want to eat out, but when I do I need to trust that brand,’” Garutti said on the call.
QSRs with drive-thrus have been the most insulated restaurant category amid dining room closures, so it makes sense for major restaurants without this off-premise channel to begin investing in remodels to incorporate drive-thru lanes or pickup windows. Shake Shack doesn't have a reopening date for its dining rooms, even for restaurants in municipalities where restaurants are allowed to slowly reopen, because it wants to take "the more cautious route."
Drive-thrus will certainly appeal to cautious diners since COVID-19 cases continue to climb even as states look to reduce their restrictions on business operations. This channel could also encourage diners to place more orders online or through Shake Shack's app. Even before dining room closures, consumers were primed for digital oder and pickup with Chipotle's digital order drive-thru lanes, which contributed to the chain's 90% increase in 2019 digital sales. If Shake Shack sees a quick return on investment and digital gains for its new drive-thrus, it's likely that other QSRs and fast casuals could evaluate doing similar remodels for their standalone restaurants.
