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Set to flip in Massachusetts

Fast-growing burger chain planning for 3 restaurants soon, 7 more by mid-2009

Email|Print|Single Page| Text size + By Elizabeth Campbell
Globe Correspondent / July 12, 2008

If you want a salad, go somewhere else.

That's the concept behind Five Guys Burgers and Fries, a fast-growing national restaurant chain that plans to open its first three restaurants in Massachusetts over the next six months, followed by at least seven more by next summer. This week, a company executive was in Boston scouting more potential sites.

Though it doesn't come close to rivaling McDonald's which has 13,800 US restaurants, Five Guys Enterprises' growth rate is impressive. The Lorton, Va., company had just eight restaurants in early 2004. Today, the chain has grown to 298 in 27 states. Last year alone, it opened 100 stores.

Five Guys restaurants, with sit-down and take-out service, are scheduled to open in Dedham in early August, in Foxborough in September, and in Swampscott by year-end, the company said. The first store opened in 1986 in Arlington, Va.

"We serve the tastiest, juiciest hamburgers and hand-cut fries that you ever had," said McGuire, the company's director of Northeast franchise development, who goes by a single name. "We do not advertise so it's all done by word of mouth."

That's a good strategy these days, said David Morris, a senior analyst at Mintel, a market research firm based in Chicago. Low-cost marketing, such as YouTube videos and glowing reviews in Zagat surveys and best-burger ratings across the country, has allowed the brand to prosper in new markets, he said.

"When you're using a viral marketing concept, being able to weave Five Guys into food forums gives it a quality halo and a trendiness," said Morris. "They've done really well being able to capitalize on that and on the reviews they get, and position their brand accordingly."

Despite the slumping economy, fast-food restaurants like Five Guys - the company prefers "fast casual" because it serves food cooked to order - have continued to perform better than average in the food service industry, Morris said.

"Their price points are within reasonable parameters when people think about cutting back," Morris said. "Higher traffic customers have woven the convenience factor into their lifestyles."

Besides, a sour economy does not make people want to cook, said Harry Balzer, vice president of NPD Group, a consumer market research firm based in Port Washington, N.Y.

But people are looking for low-cost restaurants. Seventy-seven percent of all meals bought in the United States last year were at fast-food restaurants, Balzer said. The National Restaurant Association projects a 4.4 percent increase from 2007 to 2008 for "quick service" restaurants.

"Just because there's an economic downturn we have not reached the point yet where we're cutting out restaurants," Balzer said. "We're not increasing use of restaurants, but we're not decreasing the use of restaurants."

Five Guys burgers range in price from $3.19 to $5.59 for a double-patty bacon cheeseburger. The menu also includes hot dogs and veggie sandwiches. Some restaurants are in stand-alone buildings, while others are attached to stores or in malls.

Putting a new spin on the biggest segment of the restaurant industry - burgers and fries - is the key to the strength of the Five Guys brand, Balzer said.

"We don't serve salads. We serve hamburgers," McGuire said. "We don't pretend to be healthy." A company official said its food has no trans-fat and it uses peanut oil, which is cholesterol free.

Attention to detail matters, too, McGuire said.

"We debated within the company how many poppy seeds actually belong on the hamburger bun," he said.

Elizabeth Campbell can be reached at ecampbell@globe.com.

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