CHIPOTLE MEXICAN GRILL
By : Nur Adilla (23224) , Najwa Syuhada(23289) , Nurin Nabilah (23267) ,
Syazwin Ilani(23225), Mohd Hafiz (24043)
1. What is your assessment of the ways in which Chipotle has responded to the
food poisoning incidents in some of its restaurants?
INTRO
This incident happened on Dec where the consumers falling ill from food eaten and
led to 55 infected people in 11 states, 21 of whom were hospitalized.
RESPOND
Closed stores that affected for deep cleaning.
Quickly implement new food safety procedures.
High-resolution DNA-based testing of many ingredients before they are shipped to Chipotle locations
Changes to food preparation and handling practices (how some items are washed)
New internal training on safety standards for all workers.
Paid sick leave designed to ensure that ill employees stay home when they are sick
2. Does Chipotle Mexican Grill have any core competencies and, if so, what are
they?
Focused menu
Central to its operations and provides a unique value to the customer. Chipotle’s
competitors have a difficult time competing against or imitating this competency
because the times on Chipotle’s menu are tested and proven.
High quality ingredient
Awareness and respect for the environment, organic produce and unprocessed
meat.
Chipotle meets high customer expectations with their ‘Food with Integrity’
campaign. None of Chipotle’s competitors have taken as strong of a stance, nor
have they moved as quickly to increase their efforts for sustainable, humane
cultivation of their ingredients. Chipotle has and continues to lead the way in this
area of fast-casual dining.
3. What does a SWOT analysis reveal about the attractiveness of Chipotle
Mexican Grill’s situation and future prospects? How badly has the company been
wounded by the food poisoning incidents?
A SWOT analysis show that more people are interested in the higher quality of food
and better, faster service.
What makes it attractive to the customers is the use of organic ingredients and
naturally raised animal meat for food.
In late 2015 and early 2016, 55 people were infected in two E. coli outbreaks after
eating at Chipotle.
As a result, Chipotle’s food safety reputation is still far worse than any other fast-food
chain.
4. What are the primary and secondary components of Chipotle’s value chain?
The primary component of Chipotle’s value chain is the quality of food.
From the raising of the animals, to the storage, and preparation of the food, Chipotle
has taken great time in detail to assure organic and healthy products. This sets them
apart and ahead from many other restaurants.
The second component of Chipotle’s value chain is the presentation and speed of
service.
The presentation of the Chipotle atmosphere and food play a huge role. The customers
usually spend less than 10 minutes in line due to speedy and quality customer service.
5. What were the chief components of Chipotle’s strategy prior to the food
poisoning episodes? Are further strategy adjustments needed now that Chipotle
has (seemingly) gotten through the worst of the fallout of the food poisoning
incidents?
Threw out all the remaining foods
Sent home affected employees
Collaborate with state and federal health and food safety
Chipotle shuts all of its restaurant
Free burrito for early bird that signed up Chipotle website
Conduct mass mail-outs of coupons
Change the way they manage their foods
Can recover its reputation
6. Which one of the five generic competitive strategies discussed in Chapter 5
most closely approximates the competitive approach that Chipotle Mexican
Grill is employing?
Differentiation strategy
- involves creating an edge over the competition by making the products and
services different in a better way from that of the competitors.
- Chipotle is also a fast food chain that serves fast food that is freshly cooked for
the customers shortly after the order being placed
- Chipotle still remains the first choice among Mexican fast food lovers because
Chipotles menu and food in that is different than that offered by the others.
- That difference comes from the ingredients that are used and the environment
they are served in
- using healthy and environment friendly fast food producer
7. What chief difference(s) do you see between Chipotle’s strategy and the
strategy being employed at Moe’s Southwest Grill?
8. What does an analysis of the data in case Exhibit 1 reveal about Chipotle
Mexican Grill’s financial and operating performance?
Chipotle’s profitability ratios. Chipotle’s Gross profit margin was as
follows:2012 was 27.1%, 2013 was 26.6% and 2014 was 27.2%. The
trend here is about the same which is good because it is trending
upward like it is supposed to. The net profit margin Chipotle hadfor
2012, 2013 and 2014 were: 10.2%, 10.2% and 10.8%. Net income is
trending upwardcurrently with a .6% increase from 2013 to 2014.
These are very impressive numbers and arecontinuing to climb as we
speak year to year.
[Link]
use-it-as-a-marketing/
9. Based on your assessment and calculations, does Chipotle have a net
competitive advantage over some or all of these rivals? Which rival—Chipotle
Mexican Grill or Moe’s Southwest Grill or Qdoba Mexican Grill—seems to have
the strongest set of resource strengths and competitive capabilities and is
most likely to achieve the best financial performance?
Strongest Competitor – Moe’s Southwest Grill
Similar menu with more entrees and more customization options
High quality food with no trans fats and msg
All meals came with chips and their homemade salsas
Friendly hospitable atmosphere including shouting “Welcome to Moe’s” whenever a customer
walked in
FOCUS’s investment gives them more financial resources
9. Does Chipotle have a good enough strategy and adequate resource strengths
and competitive capabilities to compete effectively against Taco Bell? Your
assessment should most definitely take into account the extent to which
Chipotle’s food poisoning problems have cut into its competitive capabilities
and performance prospects.
Yes, at least for now. WHY?
Menu appeal
Food quality and taste
Better dining ambience
Best-cost provider strategy
10. What action recommendations would you make to CMG’s top executives to
help rejuvenate the company’s growth and profitability in 2016-2017?
Chipotle should invests in advertisements such as televisions and radio
commercials
Broaden the choices offered on the Chipotle menu.
Launch a pr campaign about E-coli.
Strengthening core business
Expansion domestically and in new markets with strategic alliances
Improved marketing approaches
