Summary of the Three Papers

Company Overview

Chipotle Mexican Grill first opened in 1993 in Colorado by a man name Steve Ells. He started with 16 restaurants in Colorado. By 1998, McDonalds became a large investor. By 2006, Chipotle Mexican Grill had grown to over 500 locations nationwide. Revenues for 2014 increased by 26.7 percent to $1.07 billion, net income increased by 52.3 percent in 2014 and Chipotle opened 60 new stores. (Chipotle, 2015)

When Ells initially decided to open the restaurant he also decided he would do so by respecting farmers, encouraging sustainable agriculture and respecting the environment. This mission has stood strong and only continued to grow from within.

At the end of 2014, Chipotle Mexican Grill had 1,783 restaurants worldwide. This number grew from 704 restaurants in 2007. (Chipotle, 2015) Chipotle’s initial mission was to show that food served fast did not have to fall under the typical fast food stigma of fake and overly processed ingredients. Instead, Chipotle Mexican Grill focused on raw ingredients, classic techniques and quick-service. This is Chipotle’s best value discipline—the ability to serve socially responsible, quick-service food their consumers can feel good about eating.

Objective

The objective of Chipotle Mexican Grill is to break into the fast-food industry, the restaurant industry and the health-food industry. Another objective is for the company to continue to grow into internal markets. The company can achieve all three objectives with their goal of sustainable food and non-GMO ingredients.

Functional tactics

Functional tactics are activities that are built into the routine or the day-to-day of the company. This starts with the wellness of each employee. A well taken care of employee is a happy employee and happy employees equal more willingness to see the company succeed. Each employee will be offered health benefits and paid time off. This plan will be for employees who work more than 32 hours per week. Another functional tactic that is important is making sure the right people are hired for marketing, finance and restaurant management. Employees hired for these positions will require at least a Bachelor’s Degree in Business or at least five years of very relevant work experience. Each restaurant will be given set goals for sales based on a SWOT analysis of the region and once a quarter each restaurant will be compared to each other. If one restaurant does something differently that is making a big impact on their revenue it will be rolled out to the remaining stores. This allows each employee to feel like their contributions matter.

Action items

We must first assign one person for each region to be in charge of locating the most sustainable, non-GMO locally sourced ingredients and to get the contracts in place for food shipments to each restaurant. We will have a team of five research and development individuals touring the country in search for the best quality ingredients.

Milestones and deadlines

Ideally, Chipotle Mexican Grill should be GMO-free by the end of 2016. In order to do this we must set forth quarterly goals. Each region will have three months to obtain the locally sourced, non-GMO ingredients. By the end of 2016 all regions will be complete. Once each store itself has reached the goal, they will have signs in the store by the menu to indicate they are non-GMO. Additionally, as each region is complete there will be a “grand re-opening” of each store. Online promotions, give-aways and free food will be provided to peak the interests of newcomers.

Tasks and task ownership

Each region is broken down into several different restaurants. From the top bottom the chain of command is as follows: Region(state) Manager, Regional Manager, Store Manager, Associates. Each employee will have tasks they will be responsible for. The Region Manager will be responsible for ensuring the Regional Manager has the capacity to locate the ingredients needed for the transition. This will require the Region Manager to take on some more responsibility and delegate some responsibility to the Store Manager and even Associates. The Regional Manager can ask for assistance if needed to perform the task at hand if the region is particularly large.

Key success factors

The key success factors for this transition are timeliness, thorough research, budget and marketing. It is important for the whole transition to be complete by the end of 2016 to show consumers that Chipotle kept their promise. Additionally, Chipotle needs to ensure they are getting the best deals possible of the non-GMO ingredients in order to keep their prices low and their profit margins high.

(Chipotle, 2015)

The goal for the end of 2015 is to increase in sales by another 12% and 13% for the end of 2016. By the end of 2017, after the transition has been in effect for a full calendar year the increase in sales is expected to be 15-17% since the company is breaking into the health-food market. That means that by the end of 2015, the sales will have increased to $4,601,261; end of 2016 will be $5,199,424; and by the end of 2017 the goal will be to have sales at least $5,979,337. The goals may seem hefty but with the new changes and the new market the changes bring Chipotle should remain confident in those abilities.

Contingency plan for identified risks

For each plan there are always risks. It is important for the company to set forth a risk management plan and to keep track of each risk identified, whether it came to fruition or not. With the goals listed above, Chipotle runs the risk of investing too much into the transition without a good profit margin. It is important that Chipotle evaluate the potential risks per region as early as possible in order to try to avoid potential disasters.

Conclusion

Chipotle Mexican Grill has the ability to revolutionize the way consumers see fast-food. Instead of seeing it as an unhealthy last minute meal option they will have the option to eat something they can feel good about eating and still get it just as quickly as a traditional fast-food.

References

Chipotle Mexican Grill. (2015). Talk to us. Retrieved from: https://chipotle.com/faq?_ga=1.197636012.2066809105.1433075930