1 00:00:00,120 --> 00:00:03,000 Speaker 1: After three years of food price hikes, US and European 2 00:00:03,000 --> 00:00:06,040 Speaker 1: consumers are voting with their wallets now. Pressure on the 3 00:00:06,040 --> 00:00:09,399 Speaker 1: sector has led to supermarkets and fast food chains offering 4 00:00:09,400 --> 00:00:12,400 Speaker 1: more promotions and deals, including McDonald's in the US launching 5 00:00:12,520 --> 00:00:14,720 Speaker 1: a five dollars value meal now here in the UK. 6 00:00:14,880 --> 00:00:18,960 Speaker 1: Five Guys, which has more than nineteen hundred locations worldwide, 7 00:00:19,320 --> 00:00:23,439 Speaker 1: has continued its expansion despite uncertainty around the economy. It's 8 00:00:23,440 --> 00:00:26,640 Speaker 1: discuss the outlook for the industry with John eg Bertie's 9 00:00:26,680 --> 00:00:30,080 Speaker 1: chief executive of five Guys in the UK and Europe. John, 10 00:00:30,160 --> 00:00:32,760 Speaker 1: thank you so much for joining us. A lot more 11 00:00:32,760 --> 00:00:35,920 Speaker 1: fun talking about burgers and milkshakes and anything else that's 12 00:00:35,920 --> 00:00:38,959 Speaker 1: going on in the world right now. It's going well 13 00:00:39,000 --> 00:00:39,919 Speaker 1: because you're expanding. 14 00:00:40,200 --> 00:00:42,600 Speaker 2: Yeah, So five Guys we have two hundred and seventy 15 00:00:42,640 --> 00:00:45,520 Speaker 2: stores in Europe now one hundred and seventy in the UK. 16 00:00:45,960 --> 00:00:48,959 Speaker 2: We'll be opening about fifty stores a year, so at 17 00:00:48,960 --> 00:00:51,360 Speaker 2: a million to a million and a half investment per store, 18 00:00:51,360 --> 00:00:54,560 Speaker 2: that's a significant vote of confidence in the future here 19 00:00:54,560 --> 00:00:55,000 Speaker 2: in Europe. 20 00:00:55,120 --> 00:00:58,520 Speaker 1: So what's your biggest concern right now? What's top of 21 00:00:58,600 --> 00:01:01,680 Speaker 1: mind of things you wor is planning is it staffing, 22 00:01:02,000 --> 00:01:03,240 Speaker 1: is it food price inflation? 23 00:01:03,600 --> 00:01:06,400 Speaker 2: Well, of course the UK consumer and the European consumer 24 00:01:06,440 --> 00:01:08,679 Speaker 2: has been under a lot of pressure of late. And 25 00:01:09,240 --> 00:01:12,160 Speaker 2: how do you provide a value proposition to the cut 26 00:01:12,200 --> 00:01:14,160 Speaker 2: to the consumer in this market? 27 00:01:14,200 --> 00:01:15,279 Speaker 1: And the good thing. 28 00:01:15,160 --> 00:01:18,120 Speaker 2: For five Guys is that we have the highest value 29 00:01:18,120 --> 00:01:21,160 Speaker 2: for money fries for example, in the business the generosity 30 00:01:21,240 --> 00:01:24,040 Speaker 2: ounce for ounce is the best in terms of quantity 31 00:01:24,120 --> 00:01:27,320 Speaker 2: in terms of value for money for the fries is 32 00:01:27,360 --> 00:01:31,440 Speaker 2: the competes with all the QSRs for example. So yeah, 33 00:01:31,480 --> 00:01:35,160 Speaker 2: providing customers with great value for money. Five Guys has 34 00:01:35,160 --> 00:01:37,000 Speaker 2: a lot of free stuff as well. We have free 35 00:01:37,000 --> 00:01:40,759 Speaker 2: pe nuts, free refills, free fifteen, free topping. So the 36 00:01:40,760 --> 00:01:44,720 Speaker 2: headline price may be higher than the qs R, but 37 00:01:44,760 --> 00:01:46,720 Speaker 2: when you add it all up, the value proposition is 38 00:01:46,720 --> 00:01:48,160 Speaker 2: pretty compelling at five cups. 39 00:01:48,520 --> 00:01:50,800 Speaker 1: Is it worrying for your margins? I mean, given you 40 00:01:51,040 --> 00:01:54,160 Speaker 1: you also pride yourself of saying you provide very high 41 00:01:54,240 --> 00:01:57,800 Speaker 1: quality ingredients that I imagine have gone up quite a 42 00:01:57,880 --> 00:02:00,360 Speaker 1: lot in terms of expense in the last three four years, 43 00:02:00,400 --> 00:02:02,559 Speaker 1: but you haven't passed on that to consumers. 44 00:02:02,880 --> 00:02:05,240 Speaker 2: Yeah, So for other brands, the playbook whenever you have 45 00:02:05,320 --> 00:02:08,919 Speaker 2: an environment like this would be to shrink the product 46 00:02:09,360 --> 00:02:11,560 Speaker 2: and to compromise on the quality of the ingredients, and 47 00:02:11,600 --> 00:02:14,160 Speaker 2: of course five Guys would never do that, So we 48 00:02:14,280 --> 00:02:18,280 Speaker 2: have to focus on providing fantastic customer service along with 49 00:02:18,320 --> 00:02:21,480 Speaker 2: the great product. In five Guys is a treat. So 50 00:02:21,720 --> 00:02:24,079 Speaker 2: you're not going to go to five Guys every day 51 00:02:24,200 --> 00:02:26,919 Speaker 2: or you know, multiple times a week necessarily, So when 52 00:02:26,919 --> 00:02:28,920 Speaker 2: you go to five Guys, you want to have the 53 00:02:28,960 --> 00:02:32,800 Speaker 2: best burger. You can have fantastic customer service, great milkshakes, 54 00:02:32,840 --> 00:02:35,519 Speaker 2: and perfect fries. So we've got to focus on making 55 00:02:35,560 --> 00:02:36,320 Speaker 2: sure that you get that. 56 00:02:36,880 --> 00:02:39,080 Speaker 1: And it's true you go around the country and actually 57 00:02:39,080 --> 00:02:42,000 Speaker 1: go and like quality tests every day you're having multiple 58 00:02:42,040 --> 00:02:44,560 Speaker 1: burgers or multiple bites of burgers just to make sure 59 00:02:44,560 --> 00:02:45,600 Speaker 1: that they all taste the same. 60 00:02:45,800 --> 00:02:49,840 Speaker 2: So we're very operations driven and I'm fully certified to 61 00:02:50,160 --> 00:02:52,079 Speaker 2: make burgers and fries. I can cook your burger next 62 00:02:52,080 --> 00:02:55,280 Speaker 2: time you come in. And being able to know our 63 00:02:55,360 --> 00:02:57,760 Speaker 2: standards and cook to standards. We don't have timers, we 64 00:02:57,760 --> 00:03:01,120 Speaker 2: don't have any cooke to we have to actually know 65 00:03:01,160 --> 00:03:05,000 Speaker 2: the standards that we're cooking to. So we're all certified 66 00:03:05,320 --> 00:03:07,160 Speaker 2: in the kitchen and that's really the focus of the 67 00:03:07,680 --> 00:03:10,359 Speaker 2: business is on burgers and fries and taking care of 68 00:03:10,480 --> 00:03:11,239 Speaker 2: hungry customers. 69 00:03:11,680 --> 00:03:14,120 Speaker 1: Is it? You know, is staffing an issue? Are you 70 00:03:14,200 --> 00:03:16,359 Speaker 1: Are you finding enough people that want to work? Yeah? 71 00:03:16,400 --> 00:03:16,760 Speaker 1: Of course. 72 00:03:16,760 --> 00:03:20,320 Speaker 2: You know, having great crew is so important in the 73 00:03:20,320 --> 00:03:22,960 Speaker 2: food business. It's all about passion because you want to 74 00:03:23,000 --> 00:03:25,320 Speaker 2: know that people who are cooking your food actually care 75 00:03:25,720 --> 00:03:28,080 Speaker 2: about the product that you're getting. So making sure that 76 00:03:28,120 --> 00:03:31,119 Speaker 2: we have people who are not only certified to make 77 00:03:31,160 --> 00:03:34,200 Speaker 2: the product, but actually care about the food that you're 78 00:03:34,240 --> 00:03:35,400 Speaker 2: going to be eating is essential. 79 00:03:35,600 --> 00:03:38,560 Speaker 1: But competition must be high. I mean there's like a 80 00:03:38,880 --> 00:03:42,240 Speaker 1: you know, talent war even for like wagers and people 81 00:03:42,240 --> 00:03:44,560 Speaker 1: that are at that high standards. Do you have to 82 00:03:44,600 --> 00:03:46,480 Speaker 1: pay more? How do you retain them? Yeah? 83 00:03:46,520 --> 00:03:48,640 Speaker 2: So, first of all, we pay more than the minimums, 84 00:03:48,760 --> 00:03:50,840 Speaker 2: so we pay more to start with, and every time 85 00:03:50,880 --> 00:03:53,640 Speaker 2: you learn something new at the business, we increase your 86 00:03:53,720 --> 00:03:56,960 Speaker 2: pay as well. We also have invested millions into learning 87 00:03:56,960 --> 00:03:58,880 Speaker 2: and development, so we can take you from a crew 88 00:03:58,920 --> 00:04:01,640 Speaker 2: member to being a senior leader in the business with 89 00:04:02,160 --> 00:04:04,720 Speaker 2: you know, hundreds of employees working for you. So that 90 00:04:04,800 --> 00:04:08,000 Speaker 2: learning and development journey is something we've really take pride in. 91 00:04:08,080 --> 00:04:11,520 Speaker 2: So seventy five percent of our store managers are come 92 00:04:11,560 --> 00:04:14,360 Speaker 2: from our crew base now, so that's part of the 93 00:04:14,400 --> 00:04:15,240 Speaker 2: journey we've been under. 94 00:04:15,640 --> 00:04:18,719 Speaker 1: It is a UK market different to other European markets, 95 00:04:18,839 --> 00:04:22,680 Speaker 1: so do people buy and consume burgers and fries differently 96 00:04:22,800 --> 00:04:23,520 Speaker 1: on the continent. 97 00:04:24,000 --> 00:04:27,000 Speaker 2: Every country is a little different. We and we're surprised 98 00:04:27,040 --> 00:04:29,799 Speaker 2: by every country that we open in. We just opened 99 00:04:29,880 --> 00:04:32,120 Speaker 2: up in Port of Banous in the south of Spain, 100 00:04:32,360 --> 00:04:34,760 Speaker 2: did one hundred and seventy thousand pounds in the first 101 00:04:35,160 --> 00:04:38,039 Speaker 2: last week in trade, which was three or four times 102 00:04:38,120 --> 00:04:40,640 Speaker 2: what we thought we would. We just opened up in Wimbley, 103 00:04:40,680 --> 00:04:42,960 Speaker 2: which we thought, you know, all of the kind of 104 00:04:43,160 --> 00:04:46,240 Speaker 2: high volume sites in the UK would probably have been done. 105 00:04:46,320 --> 00:04:49,240 Speaker 2: But when Taylor Swift played we did one hundred and 106 00:04:49,279 --> 00:04:51,640 Speaker 2: eighty thousand in a week worth of business there. But 107 00:04:52,200 --> 00:04:55,320 Speaker 2: when Harry Styles takes Olivia Dean for a burger two 108 00:04:55,360 --> 00:04:57,599 Speaker 2: of five guys, that really helps and drives people in 109 00:04:57,680 --> 00:04:57,880 Speaker 2: to go. 110 00:04:58,560 --> 00:05:01,279 Speaker 1: That's something to try. Are there any new countries that 111 00:05:01,320 --> 00:05:02,760 Speaker 1: you want to be in Ashup? 112 00:05:03,400 --> 00:05:06,560 Speaker 2: We're going to open Portugal next year, so we're looking 113 00:05:06,600 --> 00:05:08,960 Speaker 2: at Lisbon looking for a prime pitch site. We always 114 00:05:08,960 --> 00:05:11,520 Speaker 2: want to open up in a kind of flagship location, 115 00:05:11,680 --> 00:05:13,760 Speaker 2: so we're looking for the perfect site in Portugal. 116 00:05:14,520 --> 00:05:16,920 Speaker 1: We have a number of very talented food critics here 117 00:05:16,920 --> 00:05:18,480 Speaker 1: and I remember two years ago it was all about 118 00:05:18,480 --> 00:05:20,880 Speaker 1: the burgers. I mean, there were a number of burger 119 00:05:20,960 --> 00:05:23,200 Speaker 1: chains that were opening in the UK because it was 120 00:05:23,200 --> 00:05:25,920 Speaker 1: a hot new thing coming from the US. Is the 121 00:05:26,000 --> 00:05:28,480 Speaker 1: space still very crowded or is it less crowded in 122 00:05:28,520 --> 00:05:29,680 Speaker 1: Europe compared to the UK. 123 00:05:29,920 --> 00:05:32,000 Speaker 2: Well, a number of the US better burger brands have 124 00:05:32,080 --> 00:05:35,200 Speaker 2: come to the UK and opened and then closed shop 125 00:05:35,200 --> 00:05:39,080 Speaker 2: and gone back home. We've been very fortunate that we 126 00:05:39,160 --> 00:05:42,600 Speaker 2: have been able to open up in the pretty much 127 00:05:42,640 --> 00:05:46,120 Speaker 2: every pitch in the UK, and that's really given us 128 00:05:46,160 --> 00:05:49,680 Speaker 2: a great defensive position. And now across Europe as well, 129 00:05:49,720 --> 00:05:52,359 Speaker 2: we have thirty five plus stores in Germany, France and 130 00:05:52,400 --> 00:05:56,039 Speaker 2: Spain as well, taking those prime flagship locations. For the 131 00:05:56,040 --> 00:05:57,320 Speaker 2: better burger segment. 132 00:05:57,400 --> 00:05:59,800 Speaker 1: Do you use AI or tech to streamline and to 133 00:05:59,800 --> 00:06:02,520 Speaker 1: get you know, better customer orders or better service? 134 00:06:02,680 --> 00:06:04,640 Speaker 2: We haven't figured that out yet. We are looking at 135 00:06:04,720 --> 00:06:06,960 Speaker 2: Kiosks for the first time because we wanted to be 136 00:06:07,120 --> 00:06:09,520 Speaker 2: as famous for customer service as we are for great 137 00:06:09,520 --> 00:06:12,360 Speaker 2: burgers and fries, and we weren't sure to do kiosks 138 00:06:12,440 --> 00:06:14,919 Speaker 2: really fit into with that strategy. But there are a 139 00:06:14,960 --> 00:06:18,760 Speaker 2: lot of young customers particularly who really want a digital experience. 140 00:06:19,120 --> 00:06:22,839 Speaker 2: Our best till operator is no competition for them for 141 00:06:23,040 --> 00:06:25,760 Speaker 2: a great Kiosk. So we're providing that digital journey now 142 00:06:25,760 --> 00:06:27,080 Speaker 2: and investing in that strategy. 143 00:06:27,120 --> 00:06:29,719 Speaker 1: But Kioso is it less It's less expensive for you, 144 00:06:29,800 --> 00:06:32,160 Speaker 1: I imagine, But I feel like everyone is doing it. 145 00:06:32,600 --> 00:06:35,400 Speaker 2: You know it may be, but we're not doing it 146 00:06:35,440 --> 00:06:37,560 Speaker 2: for that reason. We're doing it to delight the customer, 147 00:06:37,600 --> 00:06:40,040 Speaker 2: and there are there is a customer subset that wants 148 00:06:40,040 --> 00:06:41,000 Speaker 2: a digital journey. 149 00:06:41,520 --> 00:06:44,440 Speaker 1: I mean, indulge me. Who's like your perfect customer? Apart 150 00:06:44,440 --> 00:06:46,640 Speaker 1: from the celebrities, I can can bring other people. 151 00:06:46,720 --> 00:06:49,280 Speaker 2: Do you eighteen to thirty five year old looking for 152 00:06:49,520 --> 00:06:52,760 Speaker 2: either something fun to do in an evening out, some 153 00:06:52,920 --> 00:06:55,919 Speaker 2: place to take your family when you're shopping, going to 154 00:06:56,000 --> 00:06:56,480 Speaker 2: a movie? 155 00:06:56,800 --> 00:06:57,799 Speaker 1: All those are great. 156 00:06:57,600 --> 00:06:59,800 Speaker 2: Occasions to think about five guys and go for a 157 00:07:00,240 --> 00:07:00,599 Speaker 2: and fry. 158 00:07:00,920 --> 00:07:02,719 Speaker 1: Do you feel like you need to have a healthier 159 00:07:02,720 --> 00:07:06,680 Speaker 1: proposition because of everything that's going on in the in 160 00:07:06,760 --> 00:07:10,000 Speaker 1: the I guess nutrition world, right, even the nest slaves 161 00:07:10,000 --> 00:07:12,960 Speaker 1: and union leavers are trying to cut calories to give 162 00:07:13,000 --> 00:07:14,640 Speaker 1: customers a healthier journey. 163 00:07:14,680 --> 00:07:17,160 Speaker 2: We're working hard to come up with some better alternatives 164 00:07:17,200 --> 00:07:18,760 Speaker 2: to the burger and fries, but we want to make 165 00:07:18,760 --> 00:07:21,720 Speaker 2: sure that it's the same caliber quality so that when 166 00:07:21,760 --> 00:07:23,840 Speaker 2: you come in, you go that's best in class. So 167 00:07:23,880 --> 00:07:26,760 Speaker 2: we're not going to offer anything until we're confident that 168 00:07:26,800 --> 00:07:28,320 Speaker 2: we have that level of product. But we do and 169 00:07:28,400 --> 00:07:30,320 Speaker 2: we will extend the product line in the business. 170 00:07:30,840 --> 00:07:32,440 Speaker 1: Do you have a say on the new products that 171 00:07:32,480 --> 00:07:34,120 Speaker 1: go online? Well, the Morell. 172 00:07:33,880 --> 00:07:36,880 Speaker 2: Family, the Morrell family, there actually are five guys and 173 00:07:36,920 --> 00:07:39,200 Speaker 2: they actually have to approve anything that we would we 174 00:07:39,200 --> 00:07:41,040 Speaker 2: would serve, but we're working hard to convince them. 175 00:07:41,040 --> 00:07:41,800 Speaker 1: Any closures. 176 00:07:42,960 --> 00:07:46,640 Speaker 2: We have closed one site in Lahavre in France, which 177 00:07:46,840 --> 00:07:50,400 Speaker 2: was I guess a casualty of Brexit, But other than that, 178 00:07:50,400 --> 00:07:52,320 Speaker 2: we're opening stores rather than closing them. 179 00:07:52,400 --> 00:07:55,320 Speaker 1: And has it changed the way There's been a little 180 00:07:55,320 --> 00:07:56,960 Speaker 1: bit of a pattern that's taken a lot of people 181 00:07:56,960 --> 00:07:59,960 Speaker 1: by surprise. You know, post COVID, it's people went out 182 00:08:00,000 --> 00:08:03,000 Speaker 1: a lot more. I know, people stop going out, I mean, 183 00:08:03,160 --> 00:08:05,440 Speaker 1: is it going really fast? I feel like the cycle 184 00:08:05,680 --> 00:08:08,440 Speaker 1: of how we entertain and go out changes rapidly. 185 00:08:08,640 --> 00:08:11,560 Speaker 2: No, it has and you know we are social creatures 186 00:08:11,600 --> 00:08:13,560 Speaker 2: in the end, and people going out and being able 187 00:08:13,560 --> 00:08:15,800 Speaker 2: to be together again, it has been a powerful trend 188 00:08:15,800 --> 00:08:17,560 Speaker 2: and it's been great to have people back in the 189 00:08:17,600 --> 00:08:20,080 Speaker 2: stores for us because seeing your food cooked in the 190 00:08:20,080 --> 00:08:22,200 Speaker 2: open kitchen and being there with your friends and family 191 00:08:22,200 --> 00:08:23,840 Speaker 2: makes a huge difference for JN. 192 00:08:24,280 --> 00:08:26,640 Speaker 1: Thank you so much for joining us. That was John Eckbert, 193 00:08:26,680 --> 00:08:30,400 Speaker 1: the chief executive of five Guys in the UK and Europe.