‘Better burgers’ take bigger bite of market

August 14, 2011 at 12:00a.m.

St. Louis Post-Dispatch

ST. LOUIS, Mo.

With all of the buzz about food trucks and local foods, it might be easy to overlook one of the fastest-growing restaurant trends these days.

Burgers. That’s right: burgers, the quintessential American classic.

But these are not the drive-through variety. Rather, these are “better burgers” made to order with fresher, premium ingredients.

It’s one way Americans are indulging without feeling guilty when they check their bank account.

Better-burger joints are sprouting up all over the place.

The forerunner in terms of size and growth nationwide is Five Guys Burgers and Fries.

When a store opened in Creve Coeur, Mo., a couple of years ago, opening week sales broke records for the franchisee, which has stores in several states.

“We made $1,800 in an hour,” said Joe Durand, the director of operations for the St. Louis region. “It was crazy busy. I pulled managers and teammates from other stores.”

The upstart Smashburger, a concept out of Denver, is also on a tear. It opened its first local restaurant in St. Charles, Mo., this month and has designs on opening 11 more in that region in the next couple of years.

Add to the mix a number of independents that are carving out a niche in this category with different spins on beef, toppings, buns, sides and atmosphere.

So why the sudden spike of interest in burgers?

“Traditional burger chains have done a poor job of focusing on burgers — as surprising as that may sound,” said Darren Tristano, executive vice president of food consulting group Technomic. “McDonald’s, Burger King and Wendy’s have expanded breakfast, gone into salads, focused on kids’ meals and now beverage.”

That’s left room for others to take up the slack by providing higher-quality, better-tasting burgers, he said.

Better-burger chains, which rang up $1.6 billion in sales last year, represent the fastest-growing segment within the fast-growing $20 billion to $25 billion fast-casual category, which includes the likes of Panera Bread Co. and Chipotle, Tristano said.

He thinks the segment has plenty of room to grow, possibly reaching $4 billion in sales.

According to consulting firm NPD Group, traffic to the top fast-casual restaurants, including Five Guys, grew 17 percent in the past three years while the rest of the restaurant industry had its steepest traffic declines in decades.

And NPD notes that burgers were one of the few resilient food categories during the recession.

“Burgers are a comfort food,” Tristano said. “Consumers have a strong familiarity with them. And the price is right.”

Tom Ryan, the founder of Smashburger, said he wants to be the last guy to say the recession was good for the four-year-old chain.

“But we think those kinds of times make people revisit their behavior and say what’s discretionary and what’s not,” he said on a recent visit to the St. Charles location. “If something is discretionary, but they don’t want to lose the behavior, they’ll find a different way to do it. ... They trade down in a lot of things. And I think we were a trade-down in price [versus conventional dining], without a trade-down in experience.”

As burger options have multiplied, so too has consumption. A recent study by Technomic found that nearly a half of today’s consumers say they eat a burger at least once a week — compared with 38 percent two years ago.

About half of Ryan’s customers say if they hadn’t gone to Smashburger, they would have eaten a burger somewhere else. But the other half say they would have eaten something else altogether, he said. “To me, that says we are putting burgers back in the choice set for consumers that wasn’t there before,” Ryan said.

Meanwhile, fast-food chains and casual dining establishments are not standing idle as the newcomers eat away at their market. Several have been tweaking menus and rolling out their own lines of premium burgers.

For now, most “better burger” purveyors are staying away from grass-fed beef, saying that it’s hard to make it taste as flavorful because it is a leaner meat.

Anthony Dahl, the Tony in Dave & Tony’s Premium Burger Joint, which opened last month, hopes there will be room for everyone in this fast-expanding business.

He turned his sandwich shop, Sammy Scott’s, into a burger eatery after burgers became the top-selling item on his menu.

“I cook what people like to eat, and people like to eat burgers,” he said.

“If you can’t beat them, join them.”