In a significant move, Shake Shack has announced the closure of nine restaurants across three states: Ohio, Texas, and California. This decision, revealed in a recent SEC filing, marks the first time Shake Shack has closed locations for reasons other than construction.
Locations Affected
The closures will impact the following Shake Shack locations:
California: Oakland, Bunker Hill, Downtown Culver, Koreatown, Silverlake, and Westfield Topanga (Woodland Hills)
Ohio: Polaris
Texas: Houston Galleria and Montrose
Reason for Closures
Shake Shack cites a lack of acceptable returns from these locations as the primary reason for the closures. Changes in the surrounding areas and cannibalization from nearby Shake Shack stores contributed to the decision.
Impact on Staff and Future Plans
Employees affected by the closures will have the opportunity to transfer to nearby stores or receive 60 days of pay if they choose not to relocate. Despite these closures, Shake Shack plans to continue expanding, with new restaurant openings and a focus on drive-thru service enhancements.
Strategic Focus Moving Forward
CEO Rob Lynch has emphasized the company’s commitment to improving service speed and expanding drive-thru options, which were introduced in 2021. Shake Shack aims to open at least 80 new locations this year and is also working to cut building costs to maximize profitability.
