Rahul Krotthapalli's questions to Shake Shack Inc (SHAK) leadership • Q3 2024
Question
Rahul Krotthapalli of JPMorgan asked how the real estate strategy has evolved for new stores in existing delivery trade areas, referencing past concerns about sales transfer.
Answer
CEO Rob Lynch responded that the company continues to get smarter about opening new Shacks in penetrated markets to minimize cannibalization. He framed market density as a net positive, stating that as they scale and penetrate markets further, they gain supply chain, operating, and marketing efficiencies that benefit the restaurant margin line.