Shake Shack IPO

Abstract

When famed fine-dining restaurateur Danny Meyer opened a hot dog cart in New York City’s Madison Square Park in 2001, the venture drew legions of customers curious to experience Meyer’s take on all-American street food. The curious became the committed and Meyer’s little experiment acquired a permanent structure in the park – the Shake Shack. The Shack regularly drew long lines, leading Meyer to build a company around the concept. In a few years, Shake Shack expanded to a chain of burger restaurants in the United States and licensed outlets internationally.

Meyer sought to differentiate Shake Shack from the long tradition of burger joints and chains that dotted the American landscape. First, Shake Shack was committed to high quality ingredients and efficient operations in each of its eateries. Secondly, the company selected high traffic locations and designed each outlet to fit into its chosen locale. Finally, Meyer wanted Shake Shack employees to create culture of hospitality that welcomed each customer as if Shake Shack was a fine-dining establishment, rather than a burger joint.

This case was prepared for inclusion in Sage Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.

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