Swot analysis of Chipotle Mexican Grill Inc. Chipotle is a US casual fast-food chain restaurant multinational company. It’s a listed company on the New York Stock Exchange. The headquarter of the company is in Newport Beach, California, USA.
The word “chipotle” means dried and smoked chili pepper. Steve Ells is the founder of Chipotle, and he laid the foundation of the company on July 13, 1993. Since then the company has grown into 2622 location points in more than 37 countries worldwide. The fast-food brand has employed over 83,000 employees to manage its various operations across the globe.
Chipotle’s main products and services are salads, quesadillas, tacos, bowls, burritos, sofritas, carne asada, steak, barbacoa, pork carnitas, chicken, bean, rice, and much more.
According to an estimate, the annual revenue of Chipotle in 2020 was 5.895 billion dollars, and it has amplified by 7.13%. Out of which, the net income of the country was 0.356 billion dollars, and it has increased by 1.6%.
McDonald’s, Taco Bell, Freebirds, Starbucks, Qdoba Mexican Grill, Baja Fresh, KFC, Moe’s Southwest Grill, Burger King, and Rubio’s Coastal Grill are some of the main products and services of Chipotle.
Today, we’ll discuss the swot analysis of Chipotle. It’s going to analyze the internal and external factors that impact the growth of the world’s leading fast-food chain. Here’s the swot analysis of Chipotle as follows;
Strengths of Chipotle
High Brand Value
According to an estimate by Forbes, the brand value of Chipotle in 2021 was 1482.69 million dollars. The market capital of the fast-food chain restaurant was 41.73 billion dollars. These figures show the brand strength and sustainability of the company in the market.
Chipotle has a very active online platform both for desktop and android. It allows customers to place an order online, and the delivery service would deliver the food to your door. However, this online shopping feature has helped the chain restaurant to maintain and increase profit during the pandemic of covid-19 in 2020.
Chipotle has maintained a professionally reliable relationship with its suppliers. The timely supply of the cooking ingredients to the restaurant’s kitchen. As a result, the company timely delivers the food to the customers.
Organically Processed Meat
Chipotle is very careful about meat and animal care. It makes sure that the dairy and poultry farms haven’t fed the birds and animals with hormones, steroids, and antibiotics to amplify their growth in a short. Rightly processed meat makes a positive impact on your health.
Chipotle follows a simple formula of doing business, and it has made the fast-food chain restaurant very popular among customers. The formula is to provide healthy and quality food at an economical price range to the customers.
One of the key strengths of Chipotle is that the company use the fresh ingredient in the cooking, not the frozen meat or the microwave processed food. The freshly prepared food gives a unique fragrance to the food of Chipotle and it attracts customers to the restaurants.
Chipotle is very cautious about the quality of the food, cooking, and fresh ingredients. It’s because the quality food sends the right message to the customer market.
Chipotle uses the classic style of cooking with pan, ports, and cutting vegetables with knives, instead of mechanical tools. It gives the impression of a home-cooked meal.
Burritos, Burrito bowls, tacos, and salad are some of the main food items of Chipotle, and they have a unique taste. It attracts customers to visit the restaurants over and over again and enjoy the meal.
Weaknesses of Chipotle
Chipotle offers only taco and burrito-based products. The limited food menu limits the growth of the company. Therefore, the chain restaurant brand should expand its menu to increase the customer market share.
Chipotle’s food items contain a high level of salt and spices, and they cause higher blood to the BP patients. The company should consider offering less salty and less spicy food to health-conscious customers.
Chipotle has a limited number of suppliers that supply beef, pork, and chicken to the company. The overdependence of the company on some suppliers makes the supply chain network of the restaurant very risky.
Opportunities available to Chipotle
Chipotle should consider launching the drive-through service. It would make the shopping much easier and safer especially under the circumstances of social distancing. It would attract socially distancing conscious people.
High-skilled employees are a great asset to the company. The investment in the development of their skill is actually an investment in the company. If they start delivering quality service, it would attract more customers and the increment in the sale would result in. Therefore, Chipotle should consider investing its resources in the training of employees.
The fast-food industry has been growing for the past few years. The competitors are adding unique elements to their menu to differentiate themselves from the crowd. Chipotle should now consider doing the same by upgrading its offers in terms of menu, food, location, size, parking space, or anything that would give the company a unique competitive edge.
Chipotle is already offering its services in France, Germany, Canada, UK, and approximately in more than 37 countries across the world. Now, the fast-food chain restaurant should expand into the developing markets where the fast-food market is growing.
Threats Chipotle has to face
The fast-food market has become very competitive in recent years. The growth and productivity of the competitor brands like McDonald’s, Tex Mex, Starbucks, and others pose serious threats to the growth of Chipotle.
According to a report by New York Times, 16 and 17 years old teenagers were working 9 hours a day in the states of Massachusetts. It was against the labor laws of the state. However, the courts found Chipotle guilty and imposed a penalty of 1.4 million dollars in January 2020.
The animal rights movements have made the regulations very strict for the farm owners in terms of feeding and raising the animals. The strict regulations have increased the price of meat. It has now become very difficult for Chipotle to have the rightly processed meat at the right price.
Chipotle may have made some false claims in the marketing of its products that they contain lower calories food items which are far from the truth. The company should be honest about its offerings and ingredients. Such claims are negative reputing the image of the company.
Chipotle has had safety hazard issues. Like the spread of the norovirus issues that make sick hundreds of customers in various states in 2015. That’s why many people have stopped visiting and dining at the brand’s restaurant. Such incidents have badly impacted the growth of the company.
Conclusion: Chipotle Swot Analysis
After an in-depth study of the swot analysis of Chipotle, we have realized that Chipotle is indeed the world’s leading fast-food chain restaurant brand. The safety hazard trust issues, child labor lawsuits, and limited product portfolio are some of the main issues. Chipotle should expand its market and portfolio and follow the safety protocols
Ahsan Ali Shaw is an accomplished Business Writer, Analyst, and Public Speaker. Other than that, he’s a fun loving person.