Chipotle Grill Case Study Essay

What does a SWOT analysis reveal or so the drawing card of Chipotle Mexi bear Grills situation and future prospects? There ar a lot of things about Chipotle that have kept them successful in previous years. Opportunities and strengths depict that presently the company has a steadfast and positive image in its established markets which is mainly in the U.S., U.K. and Canada. Strong brand recognition drives the company. customer loyalty aloneows a long-term positive impact to Chipotle, which enhances company value. Targeting a group who is health conscious, surround friendly and loves Mexican fast nourishment reserves Chipotle on the forefront of success. Chipotle has an extensive line of nutritionally balance menu items derived from both constitutional and naturally raised ingredients. This idea led to the concept of victuals with impartiality (Gamble, Thompson, Jr., & Peteraf, 2015, p. 303). Chipotles reputation encases ethical and charit able standards along with healthy choices for the consumer. Chipotle is company-owned, not a franchise so maintaining integrity is easier. Customers whitethorn recognize to dine-in, take-out, and even order online to pick-up in the restaurant. These options have strengthened the company by offering convenience and availability to the customer. The brand also has a bright future in the untapped regions and with ample scope of introducing new food items in its menu. The creator of Chipotle came up with five core elements in which to base the strategy of the establishmentServing a foc utilise menuHigh quality, reasonably priced, expedient menu itemsOperational efficiencyFriendly staffAw atomic number 18ness and respect for the environmentChipotles strategyChipotles strategy is one of differentiation. Specific types of food that can be produced through local, environmentally conscious, farmers at an affordable price point is a primary goal. Offering natural food raised from local, thoroughgoing vendors that customer s respect yet still at an affordable, fast food price, creates a stand apart from the competition. other way Chipotle differentiates from the competition is through human resource practices. People from all ethnicities are brought together to bridge circuit cultural and linguistic gaps between both employees and customers. Chipotlehas a squad dedicated to empowering, educating, and training employees to increase inbred promotions, cultural sensitivity, and communication skills. The company prides itself on hiring from within and providing employees with opportunities to grow. The key element of Chipotles strategy is Food with integrity (Gamble, Thompson, Jr., & Peteraf, 2015, p. 303). Sourcing supplies from natural, organic, and sustainable, and environmentally friendly growers/producers is an essential strategy is maintaining market standing. Not many restaurant chains, if any, can say they are consistent in this practice, which makes Chipotle rise above the rest. More and more people are making the choice to choose to eat healthier which makes Chipotle an excellent choice and places them in a strategical place in the fast food industry.With more healthy choices than other fast food establishments such as wetback ships bell, consumers are more likely to choose Chipotle. Another key element to the strategic plan is operating efficiently in an esthetically pleasing environment. Even though it is fast food, Chipotle doesnt offer a fast food setting when dining in. With a modern theme of bamboo or stained concrete flooring, pendulum lighting, and outdoor patios where available, Chipotle has reduced the cost of building and maintaining new establishments but still managed to keep the aesthetically pleasing, not-so-fast food ambiance. How does Chipotle Mexican Grills competitive strength compare against that of Taco Bell, Qdoba Mexican Grill, and Moes reciprocal ohmwest Grill?Chipotle is not as visibly prominent here in the South as it is in other states co mpared to Qdoba Mexican Grill, but more so than Moes southwesterly Grill. In recent months, Chipotle grow into the Memphis area in the Poplar/I-240 area in a new shop center near Target and Best Buy, surrounded by a variety of other restaurants and businesses. Chipotle, Qdoba, and Moes all strive for market presence by positioning themselves in areas convenient to shopping centers, in strip malls, and near business centers. They are equal in the Employment Practices category as all strive to promote from within and offer strict training and development programs focusing on expatiateed knowledge through certification processes. The differences that stand out, allowing Chipotle to excel strategically are in Customer Service, calling card Selection, and Quality. Chipotle prides itself onhaving a genuine concern for the patron by hiring individuals from all walks of life and ethnicities. Whatever talking to a customer speaks, or ethnic background they are from, there is probably a Chipotle team member who can connect with them to walk them through the dining experience. Qdoba Mexican Grill and Moes Southwestern Grill have attempted to connect through customer service and experience but are not making as strong of a head wave as is Chipotle.There is actually a unique dining experience to talk about at Chipotle that draws patrons back for more. The menu option at Chipotle consists of the highest quality natural and organic selections from local growers and farmers. Fresh sweet corn, organically fully grown cilantro, organic chili and pablano peppers, grass-fed beef, and free-range chicken are just a sampling of the examples of quality raw ingredients used by Chipotle Mexican Grill. Through high measurements of sustainability in sourcing of these raw ingredients to construction of each(prenominal) restaurant, Chipotle has easily clear a 10 in this category regardless of the price point associated with the final product. The quality of the food served at Chi potle is always above par. The cooking methods allow flavorful, robust, creations to be made in a pathetic amount of time without damaging the integrity of the raw materials. Through consistent accuracy and quality measures, aesthetically pleasing plating is also displayed with each order, down to the containers in which to-go orders are placed.What does an analysis of the data in case Exhibit 1 reveal about Chipotles financial and operating performance? Financial201220112010addition Turnover1.6371.5921.637Inventory Turnover179.4188.6189.7LiquidityQuick Ratio1.8162.6021.873Current Ratio2.9253.1833.301Investments/ tradeholdersEarnings Per Share8.846.885.76lollyabilityGross Profit Margin27.1%26.0%26.7%Operating Profit Margin16.7%15.4%15.7%Net Profit Margin10.2%9.5%9.7%Re criminal on Capital22.3%20.6%22.1%The inventory turnover ratio shows that they are able to turn over their inventory very quickly. The asset turnover ratio shows that they are able to convert their assets into sales. Their liquid ratios are good because above 1 is good and above 2 is even better. Their Earnings Per Share show that the company is trending to increase profitability and their shareholders should see an increase in value. The profitability margins have been able to grow over the past years. The financial well being of Chipotle is stable and improving. Unless well-nighthing drastic occurs, anticipating the rise in revenue and value years from now, a positive future will be in put in for Chipotle.Key Strategic IssuesChipotle has many strengths that make it an attractive company but they also have some weaknesses. In recent years, competitors have started offering healthier menu options at lower price points. Taco Bells cantina menu is much like the Chipotle brand in which it offers more of a luminance southwestern flare than traditional Mexican dishes. The menu pricing at Chipotle is higher but is repayable much in part by the use of organic and natural selections, some of which are concentrated to obtain in winter months. With difficult growing seasons across the United States, Chipotle whitethorn have to choose to change their menu in winter months. With limited menu items and ingredients that have price volatility it may not be a smooth establishment in new states and countries. Competitors are the largest threat to Chipotle. As previously stated, other fast food restaurants are adding lighter fare to their menu at a lower price that Chipotle. With the continued high costs of natural and organic menu options, menu prices may have to change to keep margins stable. Another impact to the layer line could be rising healthcare costs that may require a shift in employment for many restaurants. Chipotle has multiple opportunities to expand into other states as well as internationally. With locations in the District of Columbia, Canada, the United Kingdom, and France, Chipotle managers should be well write in the workings of International business managemen t.With expansion into other countries and the continued use of locally grown and raised staples, Chipotle would stand to make substantial profits in countries likeChina and India. Adding ingredients indigenous to each local area would promote the brand customers have grown to admire. As restaurants like Taco Bell and On the Border sell their products in grocery stores, Chipotle could follow suite and add profit to their bottom line. Restaurants like Swankys Taco Shop have alcohol and beer on the menu, now so does Chipotle in some states. Continuing this exploitation in other states would be a plus for growth as well.