Chipotle's Competitive Strategy

Chipotle ventured into a new territory when it was created, as it had an innovative vision for fast-casual restaurants. By using fresh and quality ingredients, Chipotle raised the bar in their segment. The service line where customers could see their order being prepared enhanced the experience of Chipotle. Consumers who were used to eating at fast-casual restaurants where the food was frozen and made out of sight were able to savor the uniqueness of Chipotle. These differences helped Chipotle become successful. However, as competitors copy the traits that make Chipotle unique, Chipotle must adapt and overcome in order to remain a profitable company.

There are quite a few chief differences between Chipotle’s strategy and the strategy being employed at Moe’s South West Grill’s. The biggest and most noticeable difference is Chipotle’s has company-owned restaurants only whereas Moe’s Southwest grill has franchised restaurants only. While Chipotle’s strategy is more oriented on a focused differentiation Moe’s strategy focuses on a broad differentiation of its menu. For example, the menu at Moe’s features meals such as quesadillas, tacos, burrito bowls, burritos, salads and nachos. Customers can customize main dishes with more than 20 items. Furthermore, Moe’s also offers a kid’s and vegetarian menu as well as two

Chipotle Mexican Grill is a fast casual Mexican Restaurant that operates from the United States. Although the restaurant is specifically segmented to the fast casual Mexican restaurant market, it does not simply operate in this realm. Chipotle is also successful operating in the restaurant market as well. According to the Trefis Team (2014) Chipotle Mexican Grill has managed to take market share from restaurants in the fast food industry.

The Fast food industry is extremely competitive. Although Chipotle is a step up from most fast food restaurants, it still must

The main competitors of Chipotle include Panera Bread, Qdoba and Pei Wei as well as regional competitors, which are providing similar services and products and in some cases cheaper than Chipotle.

Chipotle also has a focused but limited menu. This affords their customers the opportunity to make an easy decision and obtain their food quickly. Chipotle has the means to focus on quality of all of their menu items. Competitors can find it difficult to imitate the menu because of all of their items they serve; there just

Chipotle’s strategy is focus on the selected menu that they can provide best to the customers. Also, differentiate with other fast food restaurant such as Taco bell. Chipotle’s competitive advantage is related with the differentiation. They are in the fast-food market, but offer fresh, local produced ingredient and no hormones added to their meat and other dairy products. Therefore, customers who seek integrity, they will go to Chipotle for Mexican fast food.

Major competitors include other Mexican fast casual locations such as Baja Fresh, Del Taco, Qdoba Grill, and market leader Taco Bell. Additional competitors in the broader market include other fast casual locations such as Panera Bread

Chipotle’s competitive advantage is they are the only restaurant that is environmentally conscious. They have tried to reduce their carbon footprint on the earth atmosphere by focusing on a program called Leadership in Energy and Environmental Design (LEED) which uses solar energy for electricity to reduce the energy consumption during peak hours. They only deal with the freshest, most natural, and organic ingredients. They work with local farmers to give their customers the best taste of fast casual dining. Also, Chipotle have started a program that allows them to increase local sourcing to 35% by using produce that is grown 350 miles from their restaurants.

Chipotle has a fairly large market chain of restaurants located primarily in the United States with over 1900 restaurants, along with other locations in Canada, France, Germany and UK. The company also has two brands under the chain called ShopHouse Southeast Asian Kitchen, serving Asian-inspired cuisine, and Pizzeria Locale, a fast-casual pizza concept. In the U.S. field that Chipotle mainly operates has been experiencing rapid growth with the fast casual concepts in the industry recently, which creates its competitive advantage away from operators such as McDonald’s and

Chipotle first opened in Denver in 1993 with a simple idea behind it, “food served fast didn’t have to be “fast-food” experience”, (Chipotle Mexican Grill, 2015). Prior to CEO Steve Ellis opening the restaurant chain, he himself was a chef. Since its creation, Chipotle has become a phenomenon in the restaurant industry and has experienced tremendous growth since it went public in 2006 with over 1,600 restaurants in Canada, United Kingdom, Germany, and France, with the majority located in the United States (Chipotle Mexican Grill, 2015).

Management is the backbone of any good company. In order for a company to successful, a strong management team is needed in order to meet goals in an effective and efficient manner. Chipotle opened its doors in 1993 when Steve Ells took a chance and began his business in San Francisco. Chipotle is a chain of Mexican restaurants that is based in Denver. Chipotle is often cited as the company that started the fast casual movement where customers can get a healthy prepared meal quicker than other traditional styled restaurant. The fast casual restaurant concept was well received and Chipotle’s popularity expanded all across the United States. Customers could not get enough of the Mexican chain and massive lines could be seen stretching outside the stores all across the country. Along with its popular food, Chipotle Mexican Style Grill is a company that contains a successful management style. Why? What sets this companies management apart from the rest? There are many factors that we could analyze to understand the success of Chipotle, yet for the purpose of this paper, we will look into the cooperate culture of the company, human resource management, their leadership style, and how Chipotle deals with and how the company manages in times of crisis.

The purpose of this report is to present a strategic plan created for Chipotle Mexican Grill, Inc. (CMG). The strategic planning process began with an internal analysis to better understand Chipotle’s current mission and vision statement, and its effectiveness in leading current strategy and performance, and included analysis of Chipotle’s strengths and weaknesses, and trending financial position. External environment analysis was also conducted, to better understand the industry and its competitors. Results of the internal and external analysis were used to determine strategies for maintaining a competitive advantage. Recommendations and an action plan for strategy implementation are suggested, as well as, an evaluation plan

It is also more widely spread geographically. Subway also offers the “choose your own” style of service, but it does not serve organic foods ("Chipotle Mexican Grill, Inc. SWOT Analysis."). Hot Head Burrito is another Mexican style restaurant that would be considered a competitor. These restaurants offer cheaper menu prices, lower-carb options and “diet menus” ("Chipotle Mexican Grill, Inc. SWOT Analysis."). While Chipotle offers none of these things, they have quite a large target market and have grown tremendously just in the last five years ("Chipotle Mexican Grill, Inc. SWOT Analysis.").

Chipotle Mexican Grill is an American restaurant chain that currently has more than 1700 locations, with most of its locations in the U.S. and several in Canada and Europe. Chipotle has been gradually expanding its international presence since it opened its first location outside the U.S., in Toronto in 2008 (International Strategy, 2015). The restaurant now has 17 locations outside of the U.S. including locations in London, Paris, and Frankfurt. However, like all other international corporations, Chipotle strives to grow its business even further and extend global awareness of its brand. The next step in Chipotle’s global strategic plan would be to venture into new waters and enter Asia. Hence, Chipotle is now analyzing the decision of expanding operations into China.