Five Guys

In 1986 for a little less than $70,000, the first Five Guys hamburger restaurant was opened in Arlington, Virginia. Though originally named after Jerry Murrell, founder and chief executive, and his four sons, after a fifth son was born in 1987, the restaurant name reflects Murrell's five sons. Their philosophy was to serve fresh, hand-cooked burgers with "all the toppings you could stuff between fresh-baked buns" along with fresh-cut fries cooked in peanut oil. The business was take-out only with no delivery and no drive-through service.

Building on a company philosophy that the customer is their best salesperson, their small restaurant quickly enjoyed a cult-like following in the Washington, D.C. area where they were voted the number 1 burger in the metro area. As word-of-mouth spread, they opened four more restaurants with sit-down seating.

Even though the company has grown and expanded, they still use only fresh ground beef in their hamburgers; and there are no freezers in Five Guys locations ? just coolers ? because nothing is ever frozen. Because they use high quality foods and processes, Five Guys charges a little more for their product and are considered to be in the "better burger" category where they rank number one. With 17 possible toppings to choose from, there are over 250,000 possible ways to order a burger at Five Guys.

The Five Guys are widely known for their hand-cut fries which contain no cholesterol and served in ample portions. Jerry Murrell said that because fries are much harder to cook than burgers, they read French cookbooks and figured out how to make the perfect French fry. Most of their potatoes come from Idaho ? about 8 percent of the Idaho potato crop ? and, they like northern potatoes because they grow during the day when it is warm and stop at night when it cools down. They do not serve dehydrated fries but rather soak their fries in water and prefry them forming a seal so that when they get fried a second time, they do not absorb any oil and are not greasy. Chad Murrell leads "fry calibration" classes to drill into workers the proper mix of starch, water and temperature needed to make the perfect fry.

In 2002, when the family had five restaurants in northern Virginia and after much discussion and consideration, the family decided to sell franchises but only if the franchisees agreed to abide by Five Guys' high quality standards. Within three days of this decision, the franchising rights to Virginia were sold out. In the next few years, hundreds of Five Guys' franchises were established across the United States. The hardest part for the Murrell family was assuring that each franchise stuck to the company formula and menu.

In the past 30 years, the company has grown to 1,163 U.S. units (around 20% company-owned and 80% franchises) with a U.S. system wide sales of $1.21 billion. In addition, there are Five Guys restaurants in six Canadian provinces, the United Kingdom, and potentially in the Middle East. The family is still heavily involved in the business with Jerry as CEO, Jim helping manage the entire operation, Matt opening new restaurants, Chad overseeing management training, Ben overseeing IT, Tyler overseeing the bakeries that provide Five Guys buns, and Janie running the books. Each has equal share in the company. Around 50 percent of Five Guys' current staffers have been promoted due to robust reviewing procedures and all staffers receive paid sick leave.

1. According to Beef Producer.com, there has been a gradual, relatively consistent drop in the consumption of beef in the United States over the past few years. Suppose researchers randomly sampled 18 American adults six years ago and measured the amount of beef that they consumed in one year. Suppose also that five years later, these same researchers identified 18 closely matching American adults and measured the amount of beef that they consumed last year. The data were entered into a Minitab spreadsheet and the following output was obtained. Study the output and write a paragraph on your findings.

Test and CI for Two Proportions Sample X N Sample p Men 128 203 0. 630542 Women 153 214 0. 714953 Difference = p (1) - p (2) Estimate for difference: -0.0844114 95% CI for difference: (-0. 174226, 0. 60540317) Test for difference = 0 (vs # 0): Z = -1.84 P-Value = 0.065 Fisher's exact test: P-Value = 0.076Paired T-Test and CI: Early Year, Late Year Paired T for Early Year - Late Year N Mean StDev SE Mean Early Year 18 59.58 11. 58 2.73 Late Year 18 58.60 11.58 2.73 Difference 18 0.986 1. 619 0. 381 95% CI for mean difference: (0.181, 1.791) T-Test of mean difference = 0 (vs * 0): T-Value = 2.59 P-Value = 0.019