Assignment 1: Entrepreneurial Leadership
Jerri L. Newton
Professor Etta Steed
BUS 508 – Contemporary Business
27 October 2013
Determine how Five Guys’ philosophy sets it apart from other fast-food chains.
Jerry and Janie Murrell, the founders of Five Guys’, believed that in order to compete with large and well-established fast food chains, they would have to concentrate on the quality of their product and the satisfaction of their customers. In his own words, Jerry Murrell business plan was simple – “Sell a really good, juicy burger on a fresh bun. Make perfect French fires. Don’t cut corners.” (Wiley Plus Resources, 2012).
“They sought out the best ingredients — paying top price ...view middle of the document...
Five Guys’ believes that their best salesman is their customer. So even if the customer has to wait a few minutes longer to get their burger, it will be a burger worth waiting for.
During a interview, Jerry Murrell stated “Treat that person right, he'll walk out the door and sell for you. From the beginning, I wanted people to know that we put all our money into the food. That's why the décor is so simple -- red and white tiles. We don't spend our money on décor. Or on guys in chicken suits. But we'll go overboard on food.” (Welch, 2010).
Five Guys has a policy to never solicit reviews but they receive hundreds of them. (Welch, 2010). They also don’t deliver. When they first opened, the Pentagon called and said, "We want 15 hamburgers; what time can you deliver?" Jerry said, "What time can you pick them up? We don't deliver." There was an admiral running the place. So he called me up personally and said, "Mr. Murrell, everyone delivers food to the Pentagon." Matt and I got a 22-foot-long banner that said ABSOLUTELY NO DELIVERY and hung it in front of our store. And then our business from the Pentagon picked up.” (Welch, 2010).
These are some of the values that Five Guys’ instilled with the start-up company and they still remain strong today. By standing by these values, customers have learned just how seriously The Murrell’s take their business. Five Guys’ makes the same bun they originally started with. By sticking with what they know works, Five Guys’ continues to flourish and expand. They have had two princes from the Middle East inquire about them expanding over there, they have locations in Canada and in Florida.
Enumerate three (3) factors that contributed to Five Guys’ success in such a short time and what effect, if any, external markets had on these factors.
Three (3) factors that contributed to Five Guys success in a short time: (1) they started out small and didn’t rush into franchising, (2) the served a limited menu, and (3) they used quality ingredients.
By starting out small and keeping it a family run business, the Murrell’s did place the added stress on themselves by starting off to large or trying to franchise right away. As a matter of fact, Jerry Murrell didn’t want to franchise at all initially.
Even though they served a limited menu of only hamburgers and French fries, “the public thought Five Guys was worth it, and the company broke even its first day in business. And within a year the press was writing about "the place to get a fresh juicy burger." A couple of years later, they opened a store with seating. It was a hit, and now all the stores have seating.” (Joiner, 2012). They stood by the philosophy of “doing one thing, getting it right”.
Because they use quality ingredients their burgers are higher priced then what customers were used to paying. During an interview, Jerry Murrell stated: “Customers initially gawked at the $2.19 price ($4.59 today, adjusted for inflation), but once they tasted the burgers...