Chipotle Competitive Advantage

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Industry Analysis Chipotle was an inventor of the fast-casual segment of the restaurant industry. Fast-casual restaurants can be defined as being positioned somewhere between fast food restaurants and casual dining restaurants, but offer value to its customers through quality food, quick service, and unique upscale décor and ambiance, at a slightly higher price than fast food restaurants (Trefis Team, 2014). In recent years this segment has been producing significant gains in the restaurant industry. Technomic’s is reporting that sales in the fast casual segment have grown eleven percent, while the number of units has increased by eight percent in 2013 (Trefis Team, 2014). Porter’s Five Forces Analysis was used to better understand the profit potential in the fast-casual restaurant industry. First, the “competitive rivalry” within the fast-casual segment is rated as medium, because there is a growing number of competitors, but really only one notable rival in Qdoba, with a similar menu and quick service, but Chipotle is able to keep the competition at bay with its superb quality of food, so there are not many competitors creating pricing pressures (Hu, Ma, Saleem, Sun, & Zhang, 2013).…show more content…
It is also recommended to continue diversifying, and growing the ShopHouse Southeast Asian Kitchen, and Pizzeria Locale. As released in Chipotle’s 2014 Annual Report, two-thirds of business is take-out, so it is recommended to increase marketing for catering services and online ordering. Also, a high fixed asset ratio indicates a need to increase plant, property, and equipment to support the increase in sales. It is also recommended that Chipotle continue reinvesting shareholder’s equity to maintain financial position while growing the

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