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Bus 508 Entrepreneurial Leadership Writing Assignment 1 Five Guys

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Bus 508 Entrepreneurial Leadership Writing Assignment 1 Five
Guys
Entrepreneurial Leadership
Writing Assignment 1: Five Guys
Entrepreneurial Leadership
“Five Guys Burgers and Fries: Ingredients for Success
Five Guys Burgers and Fries has become a major contender for the
forefront of the fast food market. The Company was founded by the
Murell brothers in 1986 in Washington D.C. They created a fast food
chain that quickly grew to become one of the largest revenue producing
chains and franchises in the country.
Five Guys was created with a very simple plan that has helped to set it
apart in the fast food business. The founders adopted a philosophy that
at the time was a leader on the fast food market. They created the
business on the philosophy of “Sell a really good, juicy burger on a fresh
bun. Make perfect French fries. Don’t cut corners” (Boone, 2012) This
philosophy was extremely simple and helped to guide the future of the
business.
Five Guys puts extreme emphasis on providing the highest quality of
food possible for the customer. The company uses grass fed 80% lean
beef for their burgers. They also never freeze the meat. Everything that
is prepared at the restaurant is fresh. The company spends extra money
on quality ingredients such as Idaho Potatoes, and even takes the extra
effort to prepare them in a way as to minimize the amount of oil the fries
absorb when being made.
Five guys have also followed the mentality that the customer will be the
company’s best salesperson. The typical fast food chain spends 3% of
revenue on advertising. Five Guys does not put anything towards
advertisements. The company feels that if you treat a customer
extremely well, give them a high quality product, the will leave and
become a great source of marketing.

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Because the company does not spend money on advertising, they are
able to take and put more money into quality of the food they prepare
and let the satisfaction of customers be the avenue to which they market
their product. The menu is simple, yet the company spends more on
ensuring that no one leaves without being a satisfied customer. The
extra money they put into the ingredients and time preparing the food
fresh helps to maintain this “word of mouth” marketing strategy.
Five Guys also ensures success by keeping a simple menu and
ensuring that everything prepared in the restaurant is prepared fresh.
The company’s website mentions “Five Guys does not currently have
plans to add any items to our menu. We follow the philosophy of
focusing on a few items, and serving them to the best of our ability. If we
were to add to our menu, then you can guarantee that we would only do
so if we could serve the highest quality product possible” (Fiveguys.com,
2012). Fresh food preparation costs more than it would to stock up and
buy in bulk. The company even made the original bread maker a partner
to ensure that the original bread recipe never changes. The stores get a
shipment of fresh buns in everyday, and the location and distance from
the bakery does not matter.
To ensure quality within each store, the company completes third party
audits weekly of each store. The store is graded on cleanliness, service,
food quality, and food preparation. The other audit is kitchen and food
safety. The company takes 1.5% of its overall revenue from each
individual franchise and puts it to weekly bonuses for the employees
who work there to ensure the scores are high. The company believes
that the employees are taken care of and have a sense of accountability
and ownership; they will be better motivated to ensure the standards are
exceeded. This drives the “team” aspect. The company takes a weekly
bonus of up to $1000 and divides it among the employees, the amount
based off of the audit scores.
The original start-up values for the company allowed the company to
succeed in the market against the competition. The initial values that the
five brothers set out to achieve had not been accomplished or even
thought of at the time. Spending more money on ingredients and quality
of service than the company did on advertising was unheard of.
The first value is that the quality of food is what sells the business. The
customer will leave satisfied because the customer has spent money on

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a high quality, fresh meal. The company puts its revenue into the food,
and less on décor. Each store has very little in the way of looks. Red and
white tile are all that a customer will see when they walk in. This is
effective because the company focused on creating a high quality
product for the customer and keeps to the simplistic is better line of
thinking.
The company does not charge for extras and toppings, uses only the
highest quality ingredients, and the service and cleanliness helps
achieve the level of satisfaction for the customer. The customer is the
most important to the company. The five guys mission statement states,
“You the customer are the most important visitor on our premises. You
are not dependent on us, we are dependent on you. You are not an
outsider in our business; you are a part of it. We are not doing you a
favor by serving you; you are doing us a favor by giving us the
opportunity to do so” (Farfan, 2012). The company has not deviated from
these initial goals today and has grown to become the most profitable
fast food chain in the world today. Simplicity and quality are sometimes
all a customer wants, and Five Guys understands this.
There are many factors that contributed to the success of Five Guys in
such a short time. These factors had great effects on the company and
the fast food industry. The first factor that led to success is the idea of
serving high quality food and providing excellent service standards to the
customer. At the time, the fast food industry was a myriad of companies
all following pretty much the same business models. The food was
bought in bulk, and was not very high quality. Five Guys realized that this
was not the best approach to creating success. The company
succeeded by creating a simple menu, but offering the highest quality
product and service to customers, and used the customers and word of
mouth marketing strategy to take advantage of the lacking fast food
industry.
Another factor was that the company realized one of the best ways to
make quality of service stand out is to get the employees to be
accountable and have a sense of ownership in the store. The incentive
program that was talked about earlier almost forced excellence. This
helped the company provide its extremely high quality of service and
product. Customers were not used to such high standards. According to
an interview with Bob Dorfman, a Five guys franchise owner, “With a
shift of five or six people splitting $900 for the week, you can see how

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