Chipotle Crisis Management Plan

920 Words 4 Pages
In November of 2015, some of Chipotle Mexican Grill’s chain restaurants suffered from an E. coli outbreak that contaminated their products. About 50+ customers in 11 states have fallen ill because of this issue (Kennedy, 2016). Around 20 of those were even hospitalized due to the seriousness of the outbreak. The Chipotle team decided to endorse a Crisis Management plan in order to clear their name to the public. Chipotle closed 43 of its restaurants that were suspected to be affected so they could be sanitized, and investigate the source of the E. coli. Since the incident, Chipotle now takes serious safety precautions and safety measures to make sure that nothing like this will occur again. The franchise responded to the media immediately after …show more content…
However, after the sudden outbreak, customers remain hesitant to return back to the company, thus leaving business sales to drop increasingly over the past months. With fearful customers staying away, the company reported that restaurant sales fell nearly 15% in the fourth quarter, which caused a revenue drop of 6.8% for the period. The company was upfront about the cause of its sales woes in its earnings release (Kline, 2016). After taking control of the crisis, Chipotle managed to highlight some of the positives regarding their business, by re-introducing their safety guidelines and providing their loyalty for customer and employee relations. Co-CEO Steve Ells, said, "We are pleased to have this behind us and can place our full energies to implementing our enhanced food safety plan that will establish Chipotle as an industry leader in food safety." Ells also stated that "We are extremely focused on executing this program, which designs layers of redundancy and enhanced safety measures to reduce the food safety risk to a level as near to zero as is possible. (Kline, …show more content…
“Chipotle last week estimated that fourth-quarter sales from restaurants open a year or more fell 14.6% -- far more than the 8% to 11% decline it had expected as of early December. Last month’s sales plunged 30% from a year earlier. Chipotle said it expects fourth-quarter earnings of $1.70 to $1.90 a share, down from its earlier forecast of $2.45 to $2.85 a share (Jargon, 2016).” In attempts to win back business, the company sent out millions of direct-mail coupons for free food to gain back its business. The offer will expire on May 15, 2016. The chain stated that it had much success with their most recent promotion of free burritos, with about 5.3 million people who downloaded the mobile coupon in February, and 2.5 million actually redeeming the offer in stores (Peterson, 2016). "We fully expected that [offer] to go viral," Mark Crumpacker, Chipotle 's chief creative officer, said. "That was our first test to see how much people really wanted to come back to Chipotle. (Peterson, 2016)” Amid their massive losses, Chipotle promises more free food in the near future to help gain back its customers loyalty. In addition to the free burrito campaign, the Associated Press notes the company has also mailed out "6 to 10 million" free entree coupons, with a total of 21 million planned. But going into the summer season, those offers may turn into buy-one-get-one

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