Introduction The restaurant industry in the United States had annual sales of $ 631.8 billion and employs 12.9 million people in 2012. Even in times of recession there is little evidence that this industry has seen a decline especially in its fast food and quick service segment. But with a depressed economy with no immediate upward trend in the near future, majority of the customers indicated that they would either curtail their spending on eating or best maintain its current level which is certainly going to affect the future of many restaurants in the industry. Chipotle is part of the fast casual segment of the U.S industry with over 1,600 restaurants. Chipotle Mexican Grill was founded by Steve Ells in 1993 and had its first restaurant …show more content…
With its mission statement of “Food with Integrity” Chipotle has seen success over the last decade. But with the increase of raw material input increasing, Competitors using pricing strategy to compete for its market share and the economic Chipotle is facing some though decision on if it should continue with its “Food with Integrity” which it can ill afford in these difficult times. In this paper, we will try address ways in which Chipotle can reposition its efforts to focus more on this unique offering without affecting their “Food with Integrity” Concept. By doing so, we believe that it can capture the important and growing segment of customers who are the health-conscious, organic-friendly consumer. And achieve as a result, the growth for its brand, market share, and sales …show more content…
-Low threat of new entrant ( High input costs ) Threats -Input costs are increasing and fluctuating (beef price is rising and some ingredients such as wheat price is fluctuating) -All the restaurant’s segments are competitors and are not only competing at their own segment but also with other segments (e.g. Chipotle Competes with meals prepared at home as well as frozen or packaged food items available in supermarkets) -People reduce eating out spending economics recession and this might affect Chipotle -Competitor’s pricing strategy – competitors such as Taco Bell are offering similar products with reduced prices to compete for Chipotle’s market share -High threat of substitute fast food ( variety of choices for consumers) Situational Analysis for Chipotle Alternative Actions and Evaluation of Alternatives Alternatives Pros Cons 1. Differentiation Strategy by “ Food with Integrity” ( current Strategy) -Differentiate from competitors -Get more attraction because of unique style of serving -Rising food prices -Need for more produce as raw material inputs -Low awareness than other brand due to their marketing style of loyalty and word of mouth
Chipotle is extremely vulnerable to supply shortages. Considering the fact that their brand is built on the quality of its ingredients this is a problem. Their brand, cost premiums and a large component of their value proposition is built on and contingent on providing a product requiring inputs that the do not control ( Chipotle Mexican Grill, Inc. SWOT Analysis) . Irregularities in the work
Chipotle Queso: The Key to Happiness Growing up I loved the flavors of Chipotle; the smoky meats, the charred peppers and the blend of delicious sides. One may ask why choose this advertisement for a company like Chipotle, because of the many persuasive images, textual messages, and vibrant visuals found in this mouthwatering piece. I consider this advertisement similar to an urgent announcement in which Chipotle is warning their customers to get excited that they finally have queso. Each and every day society craves food and as we all know, Chipotle competes with multiple restaurants in the mexican fast food field. My question is, what makes Chipotle stand out from the rest?
Chipotle and Qdoba each have their similarities and differences. Dating back to the 1990s, Chipotle and Qdoba were both created within a few years of each other. Each restaurant classifies itself as a “Mexican grill” with an assembly line style of ordering. Though Chipotle and Qdoba have the same restaurant set up, they differ in price, product choices, and advertising. The prices between Chipotle’s and Qdoba’s meals differ.
To serve this food fast, in an eclectic atmosphere laid the foundation for Chipotle’s “Food with Integrity” program”. Chipotle calls this “fast casual” dinning. Using a mall inventory of ingredients and supplies to create an almost unlimited combination of it menu. Mr. Ell’s background and education allowed for a focus on health, freshness and socially conscious ingredients. This combination allows Chipotle to be a leader in the dinning category called “fast casual’’; the fastest growing segment of the restaurant industry.
1. It is clear that Gen X and Millennials have established Chipotle as part of their pop culture. With videos out there like “Chipotle is my life” as mentioned by one of participants which went viral it is clear that when young people are getting hungry chipotle isn’t far from their mind. Sometimes when things go viral or
Competition exists in most industries, and it is considerably fierce in the restaurant business. This is especially true for the focus of this paper, Panera Bread, and the specific restaurant market it operates within, “Fast Casual”. According to the balance, Fast Casual offers the ease and convenience of fast food but with a more inviting sit-down atmosphere. As evidenced by Panera’s explosive growth since its inception, their execution has helped define the Fast-Casual concept.
Who hasn’t heard about Chipotle yet? Chipotle is modern day fast food business. Chipotle thrives on serving non-GMO and healthy foods. Chipotles profits are estimated over $200 million. There are over 2,000 Chipotle franchises across America in 2015.
Chick-Fil-A vs Chipotle: Which one is better? Many people lately have been raving over Chipotle, and Chick Fil-a lately. I have always thought to myself what is so great about these two food chains. Many people like Chipotle, and then there a a lot of people that love Chick-Fil-A.
Several new fast-food companies have emerged in recent years, appealing to younger customers with their creative menu offerings. Traditional fast-food companies like McDonald's and Burger King have lost market share to these chains, such as Chick-Fil-A, ShakeShack, and Five Guys. We can see the losses of other companies because when you go near any of these places that are competing the line tends to always be longer at Chick-Fil-A. The only thing is that there are so many more locations of say Mcdonald's or Burger
Chipotle Strategic Profile and Case Analysis Purpose Chipotle Mexican Grill founded in 1993 by Steve Ells became known as the fast-casual dining in the restaurant industry (Hitt, Ireland, & Hoskisson, 2013). It was the first of its kind when Ells first opened his first restaurant and brought the idea of made-to-order burrito. The concept is so simple, and the consumer is in control of what ingredients goes into their burrito. “The immediate success from Ells’ first restaurant allowed him to repay the $80,000 loan that he borrowed from his father within a month of opening” (Hitt, Ireland, & Hoskisson, 2013, p. 71). Furthermore, this gave him the confidence to open his second restaurant in just two years.
Then in 1998, McDonalds invested $360 million into Chipotle, allowing it to expand rapidly. The Chipotle Mexican Grill experience is an introduction to fast food 2.0, a new version of chain eateries that focus on quick, fresh, and hip food for us young people. Focusing on fresh ingredients, Chipotle’s ingredients are organic and their meat is not contaminated with chemicals, unlike most other fast food chains. When I step up to the counter, I notice a refrigerator filled with drinks. With a full liquor license, Chipotle also
Chipotle’s competitors have a difficult time competing against or imitating this competency because the times on Chipotle’s menu are tested and proven. Competitors don’t have the time or ability to test this concept or perfect their menu items. Chipotle on the other hand has been able to apply this limited menu style to the other ventures such as their two Shop House locations in Washington D.C. Another core competency, shown in Figure 1, is their dedication to high quality ingredients such as the organic cultivation of produce and naturally raised meat. Chipotle meets high customer expectations with their ‘Food with Integrity’ campaign.
Chipotle is in the fast casual industry where competition is extremely intense since there are so many different dining options. An industry like fast casual restaurants has a very high growth rate therefore there is not just one company that has the market cornered. What sets the restaurants apart is not cost but product differentiation; they position themselves in the market with their slogan of Food with Integrity. Since restaurants in the fast casual industry are priced fairly in the same range Chipotle uses different product features to set themselves apart from the others (parature.com). The first value driver in Chipotle’s differentiation strategy is the product quality; they utilize local farmers who are conscience of the environment.
This provides a valuable tool for molding the kind of success-orientated culture at Chipotle. Instead of wasting time and resources while recruiting new members, they save time, capital, and resources by rewarding and promoting from within. This leads to maximization of profit, reduction of turnover, and improved employee satisfaction and performance through retained knowledge, skills, and experience of long-term employees. The net effect of these communication and management methodologies is to ensure that services offered to customers are of the highest possible quality. For example, 84% of the customers spend less than five minutes waiting to be served.
Throughout the last few decades, fast food companies have started popping out everywhere. With the