It’s a pretty great time to be Shake Shack. The buzz around the New York City-based burgers/fries/custard chain has snowballed over the last few years, as its “better” take on fast food has been met with major success.
But with every expansion come the inevitable growing pains, and while one of Shake Shack’s appears to be pretty minor, it could lead to the removal of a newer menu item. The restaurant’s Chick’n Bites, its take on the chicken nugget, reportedly “spiked food and paper costs by 35%, shrinking the company’s adjusted operating margin by more than a tenth to 24.4%,” according to Business Insider. The hit on profits has led Shake Shack upper management to consider the long-term viability of the Bites; CEO Randy Garutti notes that “it’s something we’ve got to see people continue to come back for.”
Anecdotally, I’ve tried the Chick’n Bites, and they’re solid enough to hope for continued development. The crunch of the breading, of which there was quite a bit, offers a pleasing alternative to most chicken nuggets. The obvious analogue for the Chick’n Bites is Chick-fil-A’s classic nugget, but Shake Shack’s are more robust with the all-breast meat (in exchange for fewer pieces included in each order), and less oily-slick in texture than Chick-fil-A’s.
Adding a new menu item, especially one relatively distant from most of the restaurant’s other available items, will almost always drive up costs. But if, as CFO Tara Comonte suggests, the Bites are the “main driver of higher food expenses,” Shake Shack may find itself questioning just how far it wants to wander from what brought it to the dance in the first place.