Steak'n Shake Experiences In Chicago

[Parsad]

Well, I just got back from my first visit to a Steak'n Shake.  I walked from my hotel about half a mile to the Steak'n Shake in Rosemont.  It's near a bunch of stores, not far from a stadium.  A few restaurants in the area, including a Starbucks, Chipotle, Chilli's, McDonalds and a few others.

 

I've got to say, Steak'n Shake is a very nice looking fast food restaurant.  The checkered squares, combined with the black, white and red booths, and the neon red highlighting the restaurant is very sharp.  The restaurant was very clean, as was the kitchen and back room area, and the bathroom.  The landscaping outside was also simple and crisp.

 

I walked in and was seated by a attractive young hostess with a headset on.  A young fellow came around and took my order.  His name was Ron.  Every time I saw Ron greet any customer, he always said the "Welcome to Steak'n Shake..." greeting.  Even when his friends came in, he still said it.

 

Boy, I didn't even get to the menu.  Wow, what a selection!  While narrowed from the previous menu, the new additions are a terrific blend of the comfort hamburger/hotdog/chilli core.  They had a couple of different paper table mats on each table, and the big new products right now are a "Guacamole Steakburger" and "Spicy Chipotle Steakburger".  I ordered the Guacamole one with fries and a coke.  Ron came back and apologized, but they were out of Guacamole.  I ordered the "Chipotle" one instead.

 

The restaurant was relatively busy for 10:30pm.  Maybe 14-15 people in the restaurant with a couple of cars going through the drive thru every few minutes.  Everyone was really enjoying themselves, the food, their conversations.  Almost everyone I saw inside was eating in the restaurant and not ordering take-out.  

 

After a few minutes, the hostess brought my burger over.  It was a very nice looking burger, served with skinny fries on a china plate.  Not a huge burger, but a very good size.  I’m not a fan of the skinny fries, but they do have several other alternatives including salad, baked beans, cottage cheese & fruit, and a couple of other things.

 

Now to the important part…the Steakburger!  I’m a burger connoisseur and I have to tell you, without a doubt, that Steak’n Shake’s Steakburger is one of the best fast food burgers around.  Why?  To me, a great burger is all about the quality and taste of the meat patty, and the quality and texture of the bun.  You can take a mediocre patty or bun, and juice it up with toppings and sauces, but a great burger is one where you can really taste the quality of the meat and you get a comfortable feel from the bun.  Steak’n Shake has got it perfect!

 

My favorite burgers in Vancouver are at an old family chain called Whitespot and at a higher-tier restaurant chain called Earl’s.  They are head and shoulders above any other burgers I’ve eaten in Vancouver at chain restaurants, and in fact would rank on top of any chain burgers I’ve eaten elsewhere in North America.  

 

The Whitespot burger is all about comfort…the bun, their triple’O sauce, and the meat patty.  The Earl’s burger is all about quality…the type of meat used, the toppings and the bun…the sauces play second fiddle.  The Earl’s burger with fries costs about $14 CDN.  The Whitespot burger with fries costs about $9 CDN.  My “Spicy Chipotle Steakburger” with fries cost $4.99!  It was better than the Whitespot burger and not far off the quality of the Earl’s burger.  I was incredibly impressed by that Steakburger!

 

I saw a few people order the shakes, and they’ve got several new flavours.  They looked damn good!  But I didn’t want to stuff myself tonight.  They should think about making a small version of the shake or a sundae.  I would have gotten one if they were half the size.  The service was excellent for a fast food restaurant/diner.  Ron apologized for running out of Guacamole, took great interest to see if I liked the Spicy Chipotle, and asked if I wanted a free Coke refill for the road.  

 

My total bill came to $7.94, but I left $10 because Ron did a great job!  That was for a “Spicy Chipotle Steakburger” with fries and a Coke.  Some might say that is a bit on the high end for a fast food restaurant, especially if you add in a small tip.  But I would suggest that there are a few things at work here:

 

First, there is no need for diners to sit down and eat.  Steak’n Shake has that option, like say a Johnny Rockets or a Red Robin, but you can always order take out.

 

Second, you don’t have to leave a tip.  You don’t at McDonalds, nor at alot of other fast food restaurants, and it’s not mandatory to leave one here.

 

Third, unlike Johnny Rockets or Red Robin, Steak’n Shake has the drive-thru operations, which do not require tipping the server.  You can order a terrific Steakburger, fries and Coke for about $5.75 through take-out or drive-thru.  

 

Fourth, Sardar has executed his plan to increase customer traffic by providing significant value propositions relative to his competitors.  In other words, he drove traffic in by offering the “4 meals for $4”, “Kids eat free”, “Half-price happy hour” and “$2.89 Value Pack” deals.  Now you’ve got increased customer traffic and they’ve noticed the changes at the restaurant level.  In these times, the customer at SNS is finding tremendous quality for the price.  

 

Fifth, with increased traffic, Sardar is now offering higher-end value meals, such as the two new Steakburgers and a new “Spicy Chipotle Melt” sandwich.  The new and existing customers see, that for a dollar or two more, they get a new, pretty damn good burger to try.  The successful higher-end meals will probably become permanent additions where he will drive the average customer check slightly higher.

 

I’m looking forward to eating at a couple more Steak’n Shakes while in Chicago.  Tomorrow (the 11th) I’m meeting up with Wabuffo at the Glenview Steak’n Shake around 3pm.  If anyone wants to join us, you’re more than welcome.  

 

It’s hard to find great businesses where you have a truly successful product, as well as a business that generates regular cash flow.  Often, good products disappear by the wayside, because inferior management cannot sell the product.  Or you have an inferior product become enormously successful, simply because management or the industry made it so.  Steak’n Shake, like See’s or a number of other rare companies, seems like it is creating a significant, albeit small (at this time) moat.  Cheers!

 

   

 

 

 

[Parsad]

Also, for anyone else who will be visiting a Chicago Steak'n Shake this weekend during the Pabrai Funds AGM, please post your experiences within this thread, and that will make it easier for Sardar to get all our feedback.  Cheers!

[wabuffo]

Tomorrow (the 11th) I’m meeting up with Wabuffo at the Glenview Steak’n Shake around 3pm.  If anyone wants to join us, you’re more than welcome. 

 

Looking forward to it!  If anyone else is in the Northern suburbs of Chicago and wants to join us -- please feel free.  I'll be there at 3pm.

 

wabuffo

 

 

[link01]

thanx for kicking the tires & sharing, sanjeev.

 

and it might be fun to see what our boards resident congenital skeptic (in the best sense of the word), wabuffo, has to say of his experience. i imagine that he even views sunshine, like optimism, thru a glass darkly  :)

 

RIP ingmar bergman

[lethean46]

Parsad

 

I'm surprised you had never tried a SNS?  We love it.   

 

Because of the interest on the board, I asked some questions on our last visit.  Burger is made from 3 different cuts of steak.  Did you know that?  The burger is terrific.  Bun, too.  Skinny fries, too.  I have been getting a SMALL choc shake.  That's great, too.  Husband likes their orange slush (forget the exact name).  It's yummy, too. 

 

Staff if very attentive.  They are really promoting the new menu items.  Even at the checkout register, the gal said ... I see you didn't try our new items?

 

The burger is a steakburger - literally.  Terrific taste.  No fat, no grease either. 

 

We ate lunch at SNS twice this week ... on the run.  It always seems to be busy.  Fast service.

 

Lethean .... in Canton OH

 

 

 

[Guest kawikaho]

I've gotta try SNS someday.  I'm also a burger connoisseur.  I've gotta try Whitespot the next time I'm in Vancouver.  I've tried Earls, and it was good.  I wonder how does SNS compares to Johnny Rockets, since they seem to have similar themes.  I've read several Inn N Out devotees say that SNS is definitely a better burger than Inn N Out, so that's promising for burger fans.

 

I've only found one burger joint that I think is beyond epic and just destroys.  It's only available in Queenstown, NZ, and everyone that goes there is told to check that burger joint out.  My wife and I did, and we both agreed that it is just beyond any burger we've ever had in the world.  Nothing comes close to it.  And she hates burgers, so it kind of surprised me that she took to it with so much zeal.  I'd love for someone to take that place and replicate it abroad.  I'd definitely invest 100% of my capital into it. 

[Parsad]

Second visit to a Steak'n Shake today.  I met Wabuffo at the one in Glenview.  Nice area, with a small mall of shops across the parking lot from it...Target, Kohl's, Michaels, etc.  This Steak'n Shake was very nice to look at as well.  Very, very clean as well in virtually every area I saw...restaurant, kitchen, back area and washroom.  Again staff was very pleasant.  Didn't get the "Welcome to Steak'n Shake..." greeting as much this time, but staff was good.  It was steady, but not quite as busy as the one I visited in Rosemont the night before.  Wabuffo told me that usually it’s pretty busy and the drive-thru always has a car or two in it. 

 

Wabuffo had the Spicy Chipotle Burger and really enjoyed it.  He had a chocolate shake as well which he really liked too.  This was his first visit to a Steak'n Shake since 2006, and he did not enjoy his last visit.  This visit was very different.  He really liked the burger.  We both agree that skinny fries aren’t for us.  We like wedge cut fries, or even the thicker McDonalds thin fries. 

 

We split a "Frisco Melt".  Tasty, but very much for those that love meat, cheese and sauce smothered all over.  Very much a comfort food...something you would probably crave late at night after getting hammered with your buddies!  ;D  I'm sure many enjoy this, but I'm more of a burger guy.  I also had a “split shake” of vanilla and chocolate.  Very good looking and tasting shake. 

 

I ordered the Chilli on the side, as I know many people enjoy this chilli.  Not my cup of tea also.  I'm used to a Southwestern type, with lots of green & red peppers, onions, jalapenos and a touch of cilantro.  This is more like chilli you may eat over an open fire while on a cattle drive!  Beans, ground meat, chunks of steak meat in a watery tomato sauce.  Again, for those that grew up on this type of chilli, I can understand why they buy it...but not for me. 

 

I also sampled a couple of the "Shooters"...plain with ketchup and frisco.  They are good, but the small, thin single mini-patty isn't as tasty as the larger patties.  But still this mini-burger was head and shoulders above some of their fast-food competitors like Burger King.  The Burger King mini-burgers are God-awful!

 

Wabuffo admits that he’s drunk the Kool-aid.  He’s impressed with the turnaround and likes what is happening with the restaurants.  I’ll let him give more details.  In reality, it doesn’t matter whether we like the products or not.  As long as other people like them and need to buy them…and they are in droves!

 

In regards to Lethean’s question, we don’t have any Steak’n Shakes on the west coast, so that’s why I’ve never eaten at one until now.  I’ve been really anxious to eat at one, and finally have…two in 24 hours!  If they had these in Vancouver, it would be my number one choice for a fast-food burger.  Grab and go!  And I don’t like Steak’n Shake because I’m a shareholder.  That’s just icing on the cake. 

 

The burgers are far tastier than In & Out’s.  What they do is keep it simple, fresh, execute and be consistent.  They’ve developed a cult following because they haven’t saturated the brand with too many stores…kind of like See’s.  I think SNS can do the same, as the product is superior.  Perhaps, SNS will be more like Chik-Fil-A, which would be terrific.    But it will be all about the execution going forward.  Cheers! 

 

[wabuffo]

Wabuffo admits that he’s drunk the Kool-aid.

 

Yup.  The afternoon visit to the SNS was a lot of fun.  Parsad is a gentleman and a scholar.  His recap of the SNS experience captured my impressions very accurately.

 

wabuffo

[Parsad]

It was great to meet Wabuffo.  That's why I really enjoy these trips...meeting all the boardmembers in so many locations.  Tomorrow night, a bunch more will join me in a discussion about investing and then the Pabrai Funds meeting.  I didn't realize Wabuffo and his wife are both fellow Canucks, but have worked and lived in the U.S. for many years!  Cheers! 

[Parsad]

I got in at 3am last night from Seattle, and didn't have time to put up my last SNS visit yesterday either, so here it is:

 

I decided to hit Steak’n Shake after I left the Pabrai Funds meeting.  I wasn’t going to have time to go to the Elk Grove Village one on Sunday, so I decided to check out the take-out service at the Rosemont location near my hotel.  Would be my 3rd visit in 48 hours!

 

Got there around 11:40pm in a cab.  Restaurant was steady, but a bit slower than the visit on Thursday night about an hour earlier.  Kitchen was still non-stop and making burgers, so I wonder what it is like when the place is really busy.  Again the location was clean and very inviting. 

 

My order from start to finish took less than five minutes.  I ordered the “Double Steakburger and fries” with a Coke to go.  I believe the bill came to $6.65, which was very reasonable.  The burger is made fresh from start to finish.  The order seems to always be checked twice like McDonalds before the customer receives it.

 

I took the meal back to the hotel.  The bag is a black-white combination and the drink comes with the same sort of colors, writing and logo, but in an awesome foam cup.  These cups are terrific!  My Coke stayed really, really cold for over an hour, as it was too large for me to drink right away.

 

The burger actually tastes better when you get take-out.  I don’t know why, but unwrapping that messy burger, and devouring it like that enhances the experience.  Believe it or not, those skinny fries also taste better as take-out.  I believe it may be partly psychological, because they look so thin on the plate.  But in a small take-out cup, they don’t look so thin.

 

I’m not sure how busy the drive-thru gets at various locations, but they should be milking it.  You go to In&Out at 3am, and the drive-thru is still lined up because people are there for takeout.  The Steak’n Shake drive-thrus I saw were steady, but not busy like an In&Out or even most McDonalds.  I’m sure the average check is higher at sit-down meals, but take-out does a lot more volume, since customers aren’t sitting there taking up a table for an hour and a half. 

 

All in all, the Steak’n Shake model is terrific.  The cult of personality is there, but they need to get it national.  Food quality, service, cleanliness and execution are very good.  Sardar has it going in the right direction!  Cheers!   

 

[TorontoRaptorsFan]

Thank you for the stories!

 

The only drawback is after reading each one of them I start craving a Double Steak burger!  :'(

 

I'm glad you enjoyed each visit! I wish they would open some locations here in Toronto. Can you imagine the revenue they would pull in here!!!!!

 

Having locations in malls would be another great way to expand!

[Parsad]

They actually should open one in O'Hare with no tables, just take-out.  They would be doing awesome business, because everyone can eat at a McDonald's anywhere, but if I see Steak'n Shake or an In&Out or Whitespot in an airport, I'm going to one of those three places...since they are more unique. 

 

There also aren't any Steak'n Shakes right in Chicago.  They are only in the surrounding areas.  It would do great business right in the heart of Chicago.  Sardar told a journalist once that he would be willing to open one, but they need a franchisee, since they won't open a company store.  So hopefully, they'll get one open in alot of different places over the next few years.  Cheers!

[CONeal]

I like the idea of Steak n Shake at a couple of strategic airports.  While Sadar has mentioned that he only wants to do franchise locations, I feel company owned resturants in these locations could payoff bigtime.  The reason behind the thinking is this:  airport traffic would be able to create traffic and bring in large revenues for the business and also get SNS's name out in locations where a presence does not exist (ex. L.A., Seattle, NY) or locations that tend to have an excessive amount of air traffic delays (Atlanta, Chicago).  As the concept and brand image of SNS becomes aware to more people, the possibility of selling franchise locations would rise as entrepreneur's see the opportunity to bring the model to their local market.  This could also be a way for SNS to break into the West Coast. 

[ragnarisapirate]

I kinda wonder if there is an airport/mall food court design that is coming out, with the others that are designed to go into strip malls. I would certainly be interested in what a lease for an airport would entail, furthermore, I wonder what costs would be added due to the heightened airport security.

 

It seems that with Sbarro debt being beaten down, they may have to close some locations- the last 2 times that I flew out of LGA, they had a location in 2 different terminals. A possibility for some board members to become franchisees? ;)