Steve Ell’s believed that delicious food should not have to be expensive and that fast food did not have to be of cheap quality or unhealthy. He opened the first Chipotle Mexican Grill restaurant in 1993 in Denver Colorado and it because an overnight hit. By 2011 Chipotle had 1,230 locations serving over 800,000 customers a day that created revenues of $2,269,547. Chipotle’s strategy to success consisted of five important elements; a focused menu, high quality ingredients, creating operationally efficient restaurants with distinctive interiors, great customer service and being environmentally friendly and using organic produce and meats that were raised in a humane way. Chipotle vision was “to change the way people think about and eat fast
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Some of its closest competitors include Taco Bell, Moe’s Southwest Grill, Qdoba Mexican Grill and other local restaurants within each location. Analyzing Chipotle with Porters five force model we can identify the areas in which Chipotle faces treats. Chipotle has a small number of suppliers and the products it needs are expensive and somewhat becoming scares. This gives suppliers power over the prices of the organic produce and naturally grown meats Chipotle needs for its restaurant. Chipotle needs to outreach more farmers and create more contracts to buy produce and meats from more suppliers. Since Chipotle offers high quality, organic produce, great customer service and a better dinning environment, its buyer power is low. Chipotle has made a name for itself and keeping prices low on these high quality ingredients has proven to be a difficult task, the threat of new entrants into this industry is medium. You do not need an enormous amount of capital to enter, but you would need to compete with Chipotles standard of ingredients, customer service, prices and customer throughput. Chipotle restaurants can serve about 300 customers per hour. The substitution threat is medium to high in the industry that Chipotle competes in. Customers can choose to eat at several other different restaurants like Subway, Waba Grill and Flame Broiler who all offer healthy fast food. It also has the threat of substation from other non-healthy fast food restaurants. The rivalry in this industry is high but Chipotle has been steadily growing and increasing its locations and revenues. Chipotle uses word of mouth marketing but they also spend a large amount in printing ads, radio time for commercials and online ads. One of its competitors Taco Bell had lost many clients to Chipotle and as a competitive response; they launched a more upscale line of items called Cantina Bell. Restaurants in this industry have to act quickly in order
Some of its closest competitors include Taco Bell, Moe’s Southwest Grill, Qdoba Mexican Grill and other local restaurants within each location. Analyzing Chipotle with Porters five force model we can identify the areas in which Chipotle faces treats. Chipotle has a small number of suppliers and the products it needs are expensive and somewhat becoming scares. This gives suppliers power over the prices of the organic produce and naturally grown meats Chipotle needs for its restaurant. Chipotle needs to outreach more farmers and create more contracts to buy produce and meats from more suppliers. Since Chipotle offers high quality, organic produce, great customer service and a better dinning environment, its buyer power is low. Chipotle has made a name for itself and keeping prices low on these high quality ingredients has proven to be a difficult task, the threat of new entrants into this industry is medium. You do not need an enormous amount of capital to enter, but you would need to compete with Chipotles standard of ingredients, customer service, prices and customer throughput. Chipotle restaurants can serve about 300 customers per hour. The substitution threat is medium to high in the industry that Chipotle competes in. Customers can choose to eat at several other different restaurants like Subway, Waba Grill and Flame Broiler who all offer healthy fast food. It also has the threat of substation from other non-healthy fast food restaurants. The rivalry in this industry is high but Chipotle has been steadily growing and increasing its locations and revenues. Chipotle uses word of mouth marketing but they also spend a large amount in printing ads, radio time for commercials and online ads. One of its competitors Taco Bell had lost many clients to Chipotle and as a competitive response; they launched a more upscale line of items called Cantina Bell. Restaurants in this industry have to act quickly in order