Five Guys, Rainy Day Open-Run Hits Jackpot
SPC Shake Shack·bhc Super Duper Three-Way Battle
Overcoming Price Burden, Repeat Visits... Maintaining Ratio Is Key
Hanwha Galleria's recently opened American premium burger brand 'Five Guys' is experiencing a so-called 'grand opening success,' sparking an 'open run' phenomenon in the rain despite ongoing price controversies. Competing with SPC's 'Shake Shack' and bhc Group's 'Super Duper,' both located on the same Gangnam-daero street, rumors of the domestic entry of 'In-N-Out Burger,' considered one of America's 'big three burgers,' are circulating, indicating that competition in the domestic premium burger market is expected to intensify further.
On the morning of the 26th, citizens lined up in front of the Gangnam branch of the American hamburger brand 'Five Guys,' opening its first store in Korea, to purchase hamburgers. Photo by Yonhap News
According to industry sources on the 28th, about 2,000 customers have been visiting the first Five Guys store in Korea daily since its opening day on the 26th. An 'open run' phenomenon occurred, with customers waiting in line in front of the store from the night before the official opening. On the secondhand trading platform Danggeun Market, posts appeared offering to sell two cheeseburgers (14,900 won each) and a large-sized fries (10,900 won) worth 40,000 won for more than double the price at 100,000 won, continuing to attract attention.
Five Guys is the 'ambitious project' of Kim Dong-seon, head of strategy at Hanwha Galleria and the third son of Hanwha Group Chairman Kim Seung-yeon. Kim led the brand review and the domestic business rights contract signing, dedicating himself to bringing Five Guys to Korea. The plan is to open more than 15 stores domestically over the next five years.
The premium burger competition in the domestic market is already fierce. The opening was initiated by Heo Hee-soo, vice president of SPC Group and second son of SPC Group Chairman Heo Young-in, who opened the first Shake Shack store in Korea near Sinnonhyeon Station in Seoul in July 2016. The first Shake Shack store also experienced an open run phenomenon at its opening, with long lines of waiting customers, resulting in average wait times of 2 to 3 hours even on weekdays for over a month after opening. The number of burgers sold at that time was about 3,000 to 3,500 per day on average. Currently, there are 25 Shake Shack stores nationwide, which is two years ahead of the original 2025 target, and SPC has announced plans for additional openings in the second half of this year.
Super Duper, an American handmade burger brand introduced to Korea by bhc Group in November last year, sold more than 20,000 hamburgers within two weeks of opening its first Gangnam store. Currently, about 1,400 hamburgers are sold daily on average. Following the second store in Hongdae, the third store recently opened at COEX Starfield, and the brand is rapidly establishing itself in the domestic market.
The premium American handmade burger chain 'Shake Shack,' which opened its first store in Gangnam in 2016, is crowded with people even before the store opens. Photo by Asia Economy DB
The challenge for Five Guys, a latecomer, to gain a competitive edge in the domestic premium burger market is its high price range. FG Korea, which operates Five Guys, claims to have introduced the brand to Korea with prices 13% lower than its directly operated stores in Virginia, USA, and 17% lower than in Hong Kong. However, the prices are still 10-15% higher than those of competing brands that entered the market earlier.
Five Guys' burger prices start at 13,400 won for the cheapest burger, 14,900 won for a cheeseburger, 15,900 won for a bacon burger, and 17,400 won for a bacon cheeseburger. The little size of the same menu is priced 3,500 won cheaper. Fries are priced at 6,900 won for little, 8,900 won for regular, and 10,900 won for large, while drinks cost 3,900 won for soda (carbonated beverage) and 8,900 won for a Five Guys shake. Purchasing the best-selling cheeseburger with regular fries and a shake totals 32,700 won.
Shake Shack's burger prices range from 6,800 to 15,400 won. The cheapest burger is 6,800 won, and the signature ShackBurger is priced at 8,400 won for a single patty (Single W) and 13,200 won for a double patty (Double W). The most expensive menu item, the SmokeShack Double W, costs 15,400 won, which is 2,000 won cheaper than Five Guys' bacon cheeseburger. Fries cost 4,800 won, and shakes are 6,500 won. Adding a Double W ShackBurger, fries, and a shake totals 24,500 won.
Super Duper's burger prices range from 8,900 to 15,900 won, also cheaper than Five Guys. Key menu items include the Super Single Burger at 8,900 won, Bacon Egg On Burger at 12,900 won, and Trouble Burger at 13,900 won, with the highest-priced Cordon Red Burger sold at 15,900 won. Basic fries cost 5,900 won, and milkshakes are 6,900 won. The 'San Francisco Set,' which includes the Truffle Burger, fries, and a shake, costs 19,800 won.
Customers are lined up in front of the first domestic branch of bhc Group's SuperDuper, which opened in Gangnam last November. [Photo by bhc Group]
Early success does not guarantee long-term success. Good Stuff Eatery, known as the 'Obama Burger,' ambitiously opened near Sinnonhyeon Station in October last year but decided to close within six months. Johnny Rockets, an American burger franchise introduced by Shinsegae Food in 2011, also withdrew from the domestic market last year due to changes in dining trends and the impact of COVID-19.
An industry insider said, "Premium burger brands are attracting great interest among young domestic consumers due to curiosity about new menus and nostalgia for tastes experienced abroad. However, many brands have only enjoyed short-lived popularity, so to judge whether a latecomer can settle in domestically, it is necessary to see if customer revisit rates are consistently maintained."
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