Are Shake Shack's Expansion Plans a Good Idea?

The restaurant industry is undergoing change and many brands are growing, but that has not equated to gains for investors this year. Shake Shack (NYSE: SHAK) has been no exception. The chain is quickly expanding, but foot traffic is in decline. The growth strategy may seem imprudent, but the better-burger company may not have a better choice.

When looking at official spending figures for the U.S., the restaurant industry appears to be doing very well. According to the U.S. Census Bureau, total spending at restaurants and bars has increased 2.9% so far in 2017. Some of that increase has come from price hikes as menu inflation has been about 2% this year, but the other 0.5% to 1% is from Americans eating out more.

Source: Fool.com