Fast-Casual Giants Forge Ahead with Ambitious Growth Plans
Over the course of just 18 hours this week, three prominent fast-casual brands—Chipotle, Wingstop, and Shake Shack—each revealed aggressive growth strategies for 2024, backed by strong performance in the third quarter. These three brands collectively aim to add over 700 new locations this year as part of their long-term expansion goals.
This surge in fast-casu
al expansion underscores a stark contrast within the restaurant industry. While fast-casual chains are thriving and scaling up, traditional casual dining chains are closing doors. For example, Denny’s plans to shut down 150 underperforming locations by 2025, and TGI Fridays has been steadily reducing its restaurant footprint since September.
Quick-service restaurants (QSRs) have also felt the impact, though to a lesser extent. Wendy’s, for instance, announced in its Q3 earnings call that it will close approximately 140 underperforming units this quarter. As fast-casual brands expand, the gap between high-performing and struggling brands continues to widen.
Chipotle
Q3 Openings: 86 new locations, including 73 with a “Chipotlane” drive-thru
Projected 2024 Openings: Between 285 and 315 new locations
Chipotle is rapidly advancing toward its goal of operating 7,000 locations across North America. In the year so far, it has opened 185 new restaurants, significantly outpacing last year’s growth of 149 restaurants by this point. As of the end of Q3, Chipotle has 3,615 restaurants, a nearly 9% increase compared to the same period in 2023, according to interim CEO Scott Boatwright.
The “Chipotlane” digital order pickup lanes remain a strategic focus, with 80% of new locations incorporating this feature. “Chipotlanes continue to perform well, enhancing customer access and convenience, as well as contributing to higher sales, better margins, and stronger returns,” the company stated in its earnings release.
Chipotle’s international expansion is also gaining momentum. The brand is expected to surpass the 50-location mark in Canada in November, with plans to accelerate growth there as unit economics in Canada have matched U.S. standards. In Europe, Boatwright sees “significant growth potential” and has aligned the brand’s European menu more closely with North American preferences. Chipotle also expanded to the Middle East, launching its first restaurant in Dubai in October, with another set to open in early 2024.
Looking ahead to 2025, Chipotle aims to open 315 to 345 new locations, pushing closer to its goal of a 10% net unit growth rate.
