Chipotle Mexican Grill Essay

3860 Words Nov 24th, 2008 16 Pages
Chipotle Mexican Grill

1 a) Do you think CMG ought to consider an advertising campaign? Why or why not? If so, what should be the focus of the ads? Celebrity endorsements, the humane treatment of animals in its beef, etc…?
CMG should consider an advertising campaign in order to increase awareness about the Mexican food industry and about the CMG chain. There is a relatively small market for authentic Mexican food in the United States and CMG can increase this market by having a good marketing campaign. CMG also competes with other food chains which offer healthier ingredients in their menus such as Qdoba, Panera Bread and Moe’s Southwest Grill. So in order to increase visibility over their competitors an ad campaign is advisable.
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1b) What advantages are there to not franchise the restaurants? Do you think they ought to franchise restaurants down the road? What advantage would that be for the company?
When restaurants not do franchise they maintain uniformity in service and quality which can be monitored and evaluated by Corporate using the same standards. The rigidity will ensure consistency for the chain. There are some monitoring costs that emerge when a company decides to franchise its operations. These monitoring costs are costs involved with making sure that employees at the franchisee work hard and follow the rules. This requires hiring supervisors who will monitor the employees, but somebody needs to monitor the supervisors and so forth.
Corporate culture from the founders of the company continues to be observed. The basic foundations on which the company was built is maintained. By franchising CMG would be passing its trademarks, and systems to outsiders. They would need to find ways to monitor them to make sure they are being maintained. Also there is the risk that the franchises may not maintain the culture of CMG and this may change the perception of Chipotle to customers. This would have a negative effect on the corporate branches. Even though CMG will have the right to terminate franchisee operations that do not follow the system it may have already caused damage. Also by not franchising CMG does not lose some profits by involving a
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