Feasibility Study : Chipotle Mexican Grill

As demonstrated in Exhibit 1 on page 143, the company’s total revenue increased from $1.085.782 million dollars to $3.214.591 million dollars in less than seven years. Beginning at the end of 2007 through the end of 2013, Chipotle’s Mexican Grill total revenues increased at a CAGR of 19.83%. The new provided catering program, the six elements of their strategy adapted to other cuisines (ShopHouse Southeast Asian Kitchen) and the growing number of new restaurants are decisive aspects in increasing revenue yearly.

First off, Qdoba provides many more options on its menu than Chipotle. For example, kids have four options on

A wide variety of food and a part of the community versus which is healthier which are things that need to be considered when choosing what to eat. Chick-fil-a is a unique restaurant because chicken is the only meat on a meat-based menu. Chipotle, while not unique, is very good for the few items they make. Both restaurants are so good it is hard to choose which to go

The company had run a national TV commercial which named “Back to the Start” during the Grammy Awards. Chipotle also had published their food, restaurant concept and business through favorable articles and television programs. Moreover, Chipotle used video and music programs as well as event strategy to attract the consumers’ attention to their restaurants. The company also initiated promotional activities via newly opened restaurants to attract more consumers. Chipotle introduced a reward program, the “Farm Team” to encourage more customers to join a program that educated them something related to Chipotle Mexican Grill business concept. In addition, the word-of-mouth publicity from customers enable Chipotle to reduce the cost of advertising but at the same time increasing the brand reputation of the restaurants in the

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 actions taken by Chipotle after the E.coli outbreak can be seen as both exacerbating the problem and finding ways to resolve the problem. However, as the crisis began, leadership coming from CEO Steve Ells and Co-CEO Monty Moran painted a picture of denial. One of the first decisions made in reaction the crisis was to purchase full-paid advertisements. This marketing tactic was done to mask the severity of the e-coli outbreak, sooth investors, and retain loyal customers. In addition to television advertisements, Chipotle decided to advertise using direct mail (Wahba, 2016). This practice does not correlate with traditional chipotle advertising; their last paid advertisement was in 2012. Chipotle has always operated in a fashion that let

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

Chipotle has opened their stores in few countries such as the UK, the US, Canada, Germany and France. It is now time for the corporation to follow the lead from other companies like Yum. Brands such as KFC and Taco Bell as well as McDonalds expand their footprint in the Asian market like Japan. For example, Chipotle operates less than 2,000 restaurants in only 5 countries, while McDonalds operates more than 35,000 restaurants in 119 countries, and Taco Bell, another Mexican restaurant, operates 6,500 restaurants in 20 countries which shows that the Chipotle could do better if it expands its business.

Chipotle’s kitchen and restaurant design intentionally places employees up front to reinforce a focus on service, through interaction with customers and individual attention by creating one burrito at a time (Chipotle, 2011, p. 5). While Chipotle combines basic ingredients to magnify the flavor they also stick to the basics when staffing their restaurants. Chipotle only has two shifts and cross trains their

re strong competitors and Yum! Foods leads the industry it is my recommendation that any investments be made in Chipotle.

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).

Due to economic downturn the strength of the buyers’ power has increased as the industry looks to gain consumers with pricing strategies much like those of McDonald’s “Value Menu” and combination meals even though the cost of commodities have gone up (James, 2010). Customers of QSRs are looking for quality food without high costs. While Chipotle does not have a value menu or offer any type of combination meal much of their success is due to the fact that the customers are willing to pay a higher cost for higher-quality (Chipotle, 2010).

Chipotle has recently approved the project for a new product expansion. The products that will be now offered will be red chile and green chile. This project was approved for many reasons. The project will help boost Chipotle’s sales overall. It will also add more menu items to Chipotle’s current offerings. Chipotle can capitalize and eventually also add more locations pending project success. There are so many more benefits from product expansion than risk. This definitely makes the project more feasible. I am confident that this new product expansion will bring favorable results. It will result as the stepping stone to more successful product launches.

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.").

2. What does a SWOT analysis reveal about the attractiveness of Chipotle Mexican Grill’s situation and future prospects?