Chipotle Strategy Paper
America’s favorite Mexican restaurant chain Chipotle opened its business in 1993 founded by Steve Ells with the goal “ to serve high quality, delicious food quickly with an experience that not only exceeded, but redefined the fast food experience. To that end, we focus on sourcing the best possible ingredients, serving the tastiest food, and growing the most capable team we can (CITATION).” As they grew into a national chain, their core mission was refined and named “Food with Integrity,” and they increasingly became public champions of the benefits of eating sustainable food. The chain has used the mission almost religiously, and it truly does strive to prepare food …show more content…
However, there are multiple competitors enforcing this strategy as well, which poses a threat to Chipotle and its leadership status as of now.
The strong competition among rivals pursuing a similar strategy is vastly based on product differentiation and a niche market attraction, as companies are constantly working to surpass their competitors and seek to provide just what certain consumers want.
Chipotle has revolutionized the fast food experience by offering quick meal options and complying with the healthy food trend. Health experts are constantly criticizing fast food restaurants for producing food that facilitates obesity.
Using ingredients from local farms Chipotle promotes ecosystem sustainability every chance it gets. Chipotle is currently the only national restaurant with a significant commitment to using local produce on a large scale. Chipotle’s local food supply has helped it give a competitive advantage over competing rival chains. While most restaurants have adapted to the healthy food trend through changing menu options, most cannot advertise sustainable operations. Chipotle actually works with local farmers to help them act in a sustainable way.
Chipotle’s goal is to deliver the highest quality product coupled with the highest quality ingredients, all while being friendly to the environment and to the animals that
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If the portion size is too small, consumers may consider Chipotle as inadequate place to go when they are hungry. In addition, if the customers go Chipotle with the expectation of filling up their stomach, but the perceived performance is lower than the expected performance, consumers would be dissatisfied with the service. Nevertheless, Chipotle has to consider that portion size is usually larger in the US than in the Europe. Researchers compared restaurants in Philadelphia and in Paris, and found that American restaurants served on average 25% more food than their French counterparts (Shuster, Vigna, Sinha & Tontonoz, 2012). The difference is even bigger for beverages served in fast food restaurants. Currently, McDonald’s small-sized drink served in the US contains 16 ounces of liquids, which is 18% more than the medium-sized drink (40cl, approx. 13.52 ounces) served in Spain. Taking into account the data above, Chipotle may reduce its current portion size served in the US by approximately 25% when it enters to Spain. By doing so, Chipotle may save significant amount of material costs while still live up Spanish consumers’ expectation about the portion
Also, it would be cheaper and less headache because you don’t have to wait five to ten minutes at Chipotle for your food. The meal you make at home, the kids may like it more than going out to eat. These are the three things that might or will affect Chipotle.
It turns out even Chipotle isn’t perfect. Seventeen Chipotle locations in Minnesota have been linked to a recent salmonella outbreak and are currently under investigation by the state’s health officials.
Chipotle makes sure that the plants animals are being treated right and are not fed GMOs. Years ago, the carnitas (pork) was removed from restaurants because the animals were not treated right. Our fruits and vegetables are washed and blanched, to remove germs and other harmful bacteria. Our foods and vegetables are hand cut to a certain style. We focus more over quality than with quantity but quantity is still our main concern. We did have a summer rewards program (it was just a test drive. It will be back soon) and we have a few coupons such as the Buy One, Get One Free coupon and the One Free Chorizo coupon. At Chipotle, were always thinking of the customer’s health? From our utensils to our foods, everything has a certain temperature. To make sure that everything is to temperature, we fill out “the Black Book” which is a book that records the temperatures of the foods on the front line, the grill, and the walk-in fridge. These get done periodically throughout the day. Other than temperatures, we have portion sizes to help with your health. Some people may not agree with the portion sizes but portion sizes are here for two reasons; to save food and to not fill you up on so much
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
Most of Chipotle’s suppliers are family farmers who care about their farms’ soil or animals from being damaged. Therefore, Chipotle partner with farms that prioritize the health of their land to save the environment.
Chipotles reputation and product were nothing short of stellar. Attracting customers from all walks of life but primarily from the millennial generation. The millennial generation tends to like simple, fresh food without artificial flavors or fillers from environmentally friendly restaurants. Chipotle in turns targets the millennial generation as one of their main stakeholders. For a time, the symbiotic relationship between Chipotle and the millennials thrived. The relationship almost proved to break Chipotle when a crisis of a massive Escherichia Coli (e. Coli) infection breakout occurred affecting the millennial generation the most. A drop-in Chipotles comparative sales has
Chipotle’s business strategy is affected by the strength of rivalry as their demand is slowly declining in the face the e-Coli breakout in their restaurant chain and their format is imitated by competitors (Elizabethtown College, 2014). To remain sustainable in the fast casual market, analysis of current trends including growing customer concerns about what they eat and how it is prepared must remain their fundamental focus in the years ahead. Chipotle must continue to provide a unquie dinning experience as well using classic cooking techniques and high quality ingredients, aligning their commitment to “Food with Integity”. Their biggest hurdle to overcome will align with customer trust in the face of the food safety incidents that negitively
Chipotle Mexican Grill Incorporated has always had a great reputation for being an inexpensive, high quality, fast-food chain. That reputation suddenly diminished when the company had to close 43 restaurants in Oregon and Washington State towards the end of 2015. An E.coli outbreak had emerged at six restaurants in that region, and soon afterwards the same was reported in seven other states. Health officials cited a particular restaurant at Boston College for improper handling of poultry and the presence of a sick employee after 80 students had become ill after eating there. The cause was a common virus, norovirus. After instances of contaminated food, Chipotle was being thoroughly questioned about their pledge for serving “food with integrity.”
Chipotle’s menu includes salads with chips, soft shell tacos, burritos bowls, and burritos. It uses top and ascendancy ingredients to cook in its emergent suburban and urban restaurants. While fast food restaurants rely on advertisements to uphold their menu, by contrast Chipotle concentrates on the firm selection of ingredients. That certainty changes
Attractive financial margins entice rivals to emerge and attempt to replicate Chipotle's success by focusing on leveraging high quality and responsibly raised ingredients. Culture is considered to be one of Chipotle’s top extraordinary resources which make it a key differentiator. Chipotle’s people culture, which
Despite all the troubles and safety concerns that the company went through, chipotle is striving to improve its image and standard. According to its founder, they have been implementing an enhancing their food safety plan which will establish the company as an industry number one in food safety. Also, the company have put in place state of the art food safety standards with their suppliers. Doing so will ensure that the food delivered to our restaurants by our suppliers is safer than ever before. In store, they are also going to be improvement in the way the food is process. This will include washing and cutting all produce items, shredding cheese in central kitchens, blanching of some items, and new protocols for marinating chicken and steak
Chipotle has very little political factor disrupting operation. They rely on purely organic products so in case the FDA approved more intense regulations regarding the fast food industry. While organic food may be good for nutrition, it does raise the risk of foodborne illness. In September 2015, Chipotle closed all in the West Coast markets due to a reported outbreak of E. coli bacteria.
Ford’s “Speedee Service System” was the driving force behind the fast food concept. In 1948 McDonalds was the first restaurant to implement this system. McDonald’s system included a standardized menu that permitted restaurants to provide consumers’ food fast(Sanna,2006). In 1993 Chipotle opened in Denver, Colorado. Over the last 24 years, Chipotle has grown into a publicly traded corporation that generates $3.2 billion in revenue. Chipotle currently operates in 43 states in the United States and several countries internationally(Thomas,Peteraf,Gamble,&Strickland,2016,p.c-141). By identifying changes in the fast food industry, the key success factors of Chipotle, Chipotle now and in the future, and recommendations for the organization
Chipotle has categorized its restaurants as “fast-casual” dining. The dining experience is similar to that of fast food restaurants. The customer orders and pays at the counter; the real difference is made in the quality of the food. The food offered by Chipotle is of a higher quality than the food offered by McDonald’s, Burger King, or Taco Bell.