Chipotle can open new locations in the same cities

Chipotle Mexican Grill has multiple strengths ranging from growth to style.  They have shown rapid growth from the time they opened the first restaurant location in 1993.  They have over 2,000 locations across the United States.  Their initial growth stemmed from McDonalds’ investment, however they more than tripled in size after McDonalds’ divestment in late 2005.  A large amount of this is due to Chipotle’s philosophy of Food with Integrity.  They seek to offer high quality food fast.  Chipotle is the pioneer in the fast-casual market which gives them an upper hand against their competitors.  They also have strong corporate social responsibility.  They aim to offer high quality food that is from local farmers and ranchers rather than food from factory’s.  Their food is also free of GMO’s and hormones, which is of great concern in many consumers today. 

One major weakness of Chipotle Mexican Grill is their lack of global presence.  They have just 29 locations outside the United States compared to competitor Taco Bell which had 285 locations world-wide in 2013.  One of the restaurants largest weaknesses currently is their food safety.  While they pride themselves in quality food products that are healthier for the consumer and environmentally friendly, they had an outbreak of reported E. coli in many of their restaurants in late 2015.  “As of January 27, 2016, the CDC reports a total of 55 people infected with the outbreak strain of STEC (Shiga toxin producing E. coli) O26 from a total of 11 states in the larger outbreak…” (FDA, 2016) Another weakness of Chipotle is their high prices of menu items.  Average consumer tickets range from $7-$9 whereas Taco Bell tickets average $4.50 per person.

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Chipotle has attempted different restaurants with the same fast-casual dining experience for its customers and has not been all that successful.  One such idea was ShopHouse that was the same style as Chipotle only with Asian-cuisine, but they ultimately failed.  They can open new locations in the same cities as their popular Chipotle locations in a different cuisine.  Another opportunity they have to grow their revenue, may be to offer more menu items to increase the customer experience.  While the current selection provides a unique way for the customer to choose what they do and do not want, there is always room to grow through their menu.  Finally, they must grow in their international markets to broaden their brand and grow within international markets to keep up with their competitors.

The restaurant has threats from its competitors on many different levels.  Some of the competitors may not be as strong as Chipotle financially but they offer similar products with more variety.  As observed in the five forces analysis, there are few barriers in this market and their competitors just need to find that new edge that customers prefer over Chipotle.  They are also still suffering from the E. coli outbreak in late 2015, so they must put extra attention in the health and safety of their food.