Why are fast casual restaurants like Shake Shack doing so well?

The burger chain Shake Shack told investors on Monday that it plans to expand aggressively in the years ahead. Its goal is to eventually operate 1,500 stores. Currently, it has just over 300.

The move comes as the fast casual segment of the restaurant business is growing much quicker than other parts of the industry.

There’s no Shake Shack where I live (yet), but Jersey Mike’s just opened its second location in the area. So I went for lunch. It’s next door to a new Dave’s Hot Chicken and across the street from a Chipotle – all fast casual chains.

All those restaurant chains have gotten popular among diners who want better quality rather than traditional fast food, per Jonathan Maze, editor of Restaurant Business.

“It’s a fast food concept that serves a higher-income consumer, and that higher-income consumer is more concerned about the convenience than really about the price,” he said.

They’ve also benefited from diners who’ve been pinched by inflation, according to James Cook, director of retail research at JLL.

“A lot of families who say, four or five years ago would have gone to a casual sit-down restaurant on a Friday night are now finding that too expensive,” he said.

All that’s made chains like Shake Shack bullish about expansion.

But that might be challenging, Cook noted, because the retail vacancy rate is low. “They’re going to have to be willing to spend more money, probably, than they expected. And they’re also going to have to be willing to be flexible in where they go and what the format is.”

For example, the Jersey Mike’s I went to didn’t have many places to sit. But I got my sandwich really fast.