BurgerFi bucking industry decline
North Palm-based chain says sales rose 6.7% over the first quarter in 2016.
The Fourth of July means American flags, fireworks and homecooked burgers on the grill.
So why do people spend money to eat pricey burgers from restaurants the rest of the year?
One research firm says there are signs the market for gourmet burgers may be flaming out. NPD Group recently found the better burger market is showing signs of being overcooked, with lunch traffic to quick-serve burger restaurants falling 5 percent in 2016, the biggest year-overyear decline NPD has recorded.
With lunch burgers now costing from $6 to $10 or more for exotic toppings, is the era of the upscale burger over? At BurgerFi, a North Palm Beach-based national chain, the answer is no.
Chief Executive Corey Winograd said the homegrown company posted a 6.7 percent increase in sales during the first quarter of 2017 from the same period last year. He attributed the boost, in part, to greater brand awareness.
But there’s another reason why BurgerFi may be bucking the burger burnout trend. The company makes heavy use of technology to fine tune the ordering of its burgers (priced from around $6 to about $10), hot dogs, veggie burgers, fries, onion rings, shakes and custards.
“We view BurgerFi not only as a restaurant company but as a restaurant technology company,” Winograd said.
Here’s an example: In selected BurgerFi locations, customers may place an order with a worker at the counter, or they can order food off of a kiosk. Customers receive a pager and wait to be notified when their food is ready.
When people place their own orders on the kiosk, they tend to order and spend more than if they had ordered from a human being, Winograd said.
Consequently, whether it’s brand awareness or uninhibited diners, BurgerFi (along with Shake Shack), has the highest average order sizes among the fast-casual burger chains.
BurgerFi also is making it easier for customers to order food for pickup. This month BurgerFi will begin using an outside company to receive all telephoned food orders. That means a customer doesn’t have to wait on the phone at a particular location while a worker juggles multiple calls. Instead, once an order is received, the information is transmitted via an integrated computer system to the appropriate store.
Winograd said he never imagined his job would be so integrated with technology. “But that’s the way it is these days,” he said. “You either embrace it or you lose.”
Winograd said BurgerFi has chosen to embrace it, and that’s why it will open more than 20 stores in 2017. The company, with 100 locations nationwide, is projecting $135 million in sales for 2017, up $28 million over 2016.
Of course none of these hightech steps would make a difference if the food tasted bad.
So Winograd said BurgerFi won’t compromise on its core feature: food quality. The meat is hormone- and antibiotic-free, while the bun, sourced from a New York bakery, doesn’t have chemicals or additives, he said.
Meanwhile, whatever people have to say about BurgerFi, the company wants to hear it. At BurgerFi, there are two full-time employees whose sole function is to engage with BurgerFi customers on social media, Winograd said.