Five Guys Burgers and Fries Shake Shack logos

U.S. chains helping shape U.K. restaurant landscape

David Coffer is an NRN contributor and chairman of London-based The Coffer Group, a 40-year-old consulting firm specializing in the leisure sector and comprising Davis Coffer Lyons, Coffer Corporate Leisure, Coffer Hotels and Coffer Leisure Investment Advisory.

Last summer saw the U.S. turning the tables on the British with an invasion all of its own. July 2013 marked the U.K. launches of two U.S. burger brands: Five Guys Burgers and Fries and Shake Shack. This was both brands’ first foray into the U.K., and they were opening in London on consecutive days — just a five minute walk from one another in Covent Garden.

The so-called “burger wars” had begun.

In 2012, the U.K. burger market was worth $4.55 billion, with more than a quarter of adults claiming to visit a burger- or a chicken-focused concept at least once every two weeks. McDonald’s and Burger King account for a sizeable chunk of the fast-food burger market. However, it is no surprise more American operators are keen to get in on a slice of the middle market and take on British brands such as Byron and Gourmet Burger Kitchen.

How were the two sides in the burger wars faring six months on?

The word on the market is that sales for the opening of the Five Guys at Covent Garden were more than double any of the brand’s U.S. openings. It also enjoyed a record week in the second week of January, when the number of people served increased dramatically, but the length of the queue didn’t, highlighting that the team had matured and could now process diners more quickly. I also understand that their second unit at The Oracle Shopping Centre in Reading surpassed expectations, despite having some severe restrictions on its operating hours.

The critics were, overall, less than effusive about Five Guys’ arrival; however, this doesn’t appear to have turned off the British public.

Five Guys, buoyed, I imagine, by these positive figures and public sentiment, is in the process of an aggressive expansion drive in the U.K., with an aim to have 30 sites open by the end of the year. As of early February, they were planning openings in Guildford, Kingston upon Thames and Uxbridge  all of which are within 30 miles of Central London. They are also rumored to be in negotiation on units in Manchester, Leeds, Solihull, Liverpool and Birmingham.

Shake Shack also received a warm welcome in London, and business at its outlet overlooking the historic Covent Garden market seems to be very buoyant. As a far smaller operation  34 outlets worldwide compared to Five Guys’ 2,500 open or in development  their expansion plans seem to be considerably slower. Prior to the opening, Danny Meyer, chief executive of Shake Shack parent Union Square Hospitality Group, was reported to say that he wouldn’t come to the U.K. if he didn’t think it could support at least three Shake Shacks, which gives some indication of the intended speed and scale of their initial expansion. There have been various rumors that they are looking at units in the London areas of Soho and Carnaby Street, but as of press time, nothing had been confirmed. 

Shake Shack does, however, seem to be consolidating its U.K. operation. In January it appointed a brewery in the U.K. to brew its Shackmeister Ale, which until then had been imported from Brooklyn Brewery in New York.

So, what’s next for American brands?

American restaurant brands are nothing new in the U.K., with many firmly established throughout the country. Since KFC arrived in 1965, we have seen an influx of primarily fast-food brands coming across the pond, including Pizza Hut in 1973, McDonald’s in 1976, TGI Fridays in the early ’80s, Domino’s Pizza in 1985 and Burger King in 1989.

In the past few years we have seen a very different influx of operators representing a wide range of segments and cuisines. Mexican restaurant brands have proliferated: Chipotle Mexican Grill now has six restaurants around London, Cantina Laredo opened its first site in Soho, and fast-food operator Taco Bell now has three outlets in the city. Popular New York French brasserie Balthazar opened in Covent Garden last year. Sushi Samba opened on the 39th floor of the Heron Tower in the City of London and boasts the highest outdoor terraces in London. The Palm’s new restaurant in fashionable Belgravia and STK in the Me Hotel on The Strand have both joined an increasingly saturated London steak restaurant market.

There are, no doubt, countless other operators planning on launching their own assault on the U.K., and I am certain that we will continue to see the biggest and most successful brands coming across the pond.

Who knows which brands will be going head to head in the future, but from a purely personal point of view, “ice cream wars” sounds delicious.

What restaurant concept do you think will be next to cross the pond? Tell us in the comments.