Global expansion is a hot topic in the foodservice industry but ensuring growth and success in international markets requires the right resources and knowledge.
Insights on the Hot Topic of Growing a Global Supply Chain
At IFMA’s President Conference this past November, I facilitated a discussion with industry leaders representing three firms that have a wealth of experience in global expansion: Lisa Kartzman, Senior Director, Supply Chain with Shake Shack; Mike Walpole, Director, International Supply Chain with Chick-fil-A; and Cullen Andrews, Vice President, Sales and Marketing with DOT Foods. I shared the experience in a blog published on the HAVI website.
My blog caught the attention of Morgan Swink, PhD and Professor at the Neeley School of Business at Texas Christian University. He, too, is interested in exploring what brands need to consider as they work toward or succeed in expanding globally. He asked me to collaborate with him on a Hot Topics Brief on the subject for Supply Chain Scene. With foodservice research firm Technomic estimating that global food service sales are outpacing U.S. sales growth by more than 50 percent, it’s not surprising that global expansion is a worthy hot topic.
In the brief, we take a deeper dive into Shake Shack’s experience going global. Since its beginning as a hot dog cart in Madison Square Park in 2001, Shake Shack has been one of the fastest growing fast casual restaurant chains in the U.S. with more than 200 stores and now 70 international locations. Initially, the company’s global expansion was managed domestically, but the team quickly realized that dedicated resources and knowledge were required to ensure success. In 2015, Shake Shack hired industry veteran and global brand development expert, Gary Schwartz, to support the growth and development of Shake Shack’s international markets.
Starting with its first international experience in Dubai, and expanding from there to London, Turkey, Russia, Japan and, most recently, parts of Asia, Shake Shack learned many lessons along the way. We share their journey in the brief, citing the challenges, opportunities and variability of global markets— and why today Shake Shack continues to make the investments needed to support an aggressive and long-term global strategy.
One thing we have learned for sure as we explore this topic is that it is imperative to take nothing for granted when planning a global expansion. Along with sharing broader recommendations for companies embarking on this journey, we shared additional important considerations to keep in mind. They include:
- The need to develop an entry strategy that ensures an understanding of the host country’s foreign investment regulations
- Why testing how the brand translates in different locations and keeping in mind that cultural norms differ greatly from country to country is important
- The importance of working with suppliers to ensure local codes and requirements are met
- The value of local sourcing
- How to better manage forecasting and demand
- Finding a path to mitigating long shipping lead times
If executed properly, there are many benefits to expanding globally. However, all the companies I spoke with indicated the need for guidance regarding sources of supply, distribution, technology, quality assurance, compliance and more. As seen with Shake Shack, having the right partner to support your global expansion is vital. I am proud to say HAVI has deep expertise in helping companies making connections across the supply chain to transform the way they deliver value to the world.
I invite you download the Hot Topics Briefing on Insights for Growing a Global Supply Chain and explore the possibilities.