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Analysis Chipotle Mexico Grill Company Case Study

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Vision and Mission

Chipotle Mexico Grill’s vision aims at serving high quality food that is prepared deliciously. The high quality food is obtained from classic cooking techniques, as well as sophisticated recipes. The company’s idea is to fulfill the promise of a full-service restaurant that values speed and convenience.

The ambition of the restaurant is to offer an extra special dining atmosphere that succeeds in redefining the fast food knowledge and enjoyment for everybody at inexpensive prices. Part of the vision says: “Food with Integrity”. This is a critical aspect that also forms part of the mission statement. It further declares the organization’s purpose of identifying the products and customers who are unique. This distinguishes it from the rest of the competitors (Jones & George, 2011).

The restaurant realizes the fact that there is a difference between high quality food and mere maintenance of freshness. As such, the company intends to consider the source of food it serves as a way of ensuring that its organic status does not affect the society and the general environment in a negative way.

Chipotle uses a simple strategy to determine the corporate goals by explaining the simple means through which resources will be used to achieve the particular goals (Jones & George, 2011). The company focuses on serving food that is grown in a suitable way through supporting farmers who observe highly commendable environmental practices. This, in turn, builds the farmers’ capacity, thus ensuring a steady supply of foods in the restaurant.

Competitive Intelligence

Strengths

Fast food restaurants mainly target strategic locations as an effective means of enhancing their competitive edge. Mucho chain of restaurants, for instance, has strategically established its outlets in front of, or near Walmart stores and other highly frequented public places like bus stops. The company realizes how popular Walmart is among Americans; therefore, it makes it easy for shoppers to pop into its restaurants after or during their shopping sprees (Chipotle: Food With Integrity, 2011). This way, Mucho is able to raise significant revenues because of the high human traffic around its outlets. The fast food industry is highly competitive, thus players have to build on strategic means through which they can attract and convince buyers to be their frequent and loyal customers.

The success of quick service restaurants depends on market position, strength of brands, as well as segmentation. Any industry player that fails to address these aspects keenly faces the danger of achieving overall poor performance. Taco Bell, for instance, only focuses on Mexican foods (“Taco Bell makes spicy retort to suit”, 2011).

Taco Bell is a subsidiary of one of America’s largest fast food chains, Yum! Brands Inc. This segmentation has seen the company achieve a significant 50% market share throughout the US (Yum! Brands, Inc. SWOT Analysis, 2012). Its quality is high because of the total focus that the company achieves in serving only a few selected food items, thus it manages to attract more buyers than any other industry player.

Brand recognition is a critical characteristic that determines market success to a great extent. McDonald’s has maintained the number one position in the US and the North American markets.

Its well established market operations for many years have seen it consistently build a strong image among the fast food buyers in this region (“McDonald’s Corporation SWOT Analysis”, 2005). Other smaller QSRs that have less established brand names are unable to compete with McDonald’s effectively because customers have built strong trust and loyalty in the brand over the years.

Weakness

The fast food industry has witnessed an increase in the number players, particularly in the USA. This has left the market saturated (Min & Min, 2011). Many new ventures are using low prices in an attempt to win customers from other highly established chains, such as McDonald’s. This works for them, especially in luring price-sensitive buyers away from the competitors. Although McDonald’s prices remain relatively high, the chain is unable to make significant revenues as the case was in the past (Ashman, 2001).

The industry’s sensitivity to negative image is very high and firms are at a higher risk of suffering losses in case an incident of negative image arises. Taco Bell has suffered such negative publicity. The company is struggling with the aftermath of the incident. In early 2011, the gigantic restaurant chain was sued over its beef content.

The bone of contention was the fact that the products comprised of only 36% ground beef (Taco Bell sued for putting too little beef in its ‘meat’, 2011). According to the USDA standard, the prescribed ground beef content has to make up at least 40% to be considered as meat. The lawsuit was later withdrawn in April 2011, but Taco Bell still suffered immense losses (“Consumer reports fast food survey: McDonald’s, Burger King, KFC, and Taco Bell lose”, 2011).

Fewer outlets and a relatively smaller floor space equally reduce the propensity of fast food restaurants to make large revenues and profits (Winter & Szulanski, 2001). While the highly established brand names in the industry, such as McDonald’s and Taco Bell, have literally opened up stores in all significant locations in the US and North America as a whole, it is a different case for other small players. Mucho, for instance, has a relatively small number of outlets. This hampers its revenue capacity.

References

Ashman, S. M. (2001). Consumer choice models with customer loyalty programs in retail food stores. (Order No. 9994493, University of Minnesota). ProQuest Dissertations and Theses, 222-222.

Chipotle: Food With Integrity. (2011). . Web.

Consumer reports fast food survey: McDonald’s, Burger King, KFC, and Taco Bell lose. (2011, Jun 30). PR Newswire. Web.

Jones, G. R., & George, J. M. (2011). “Chapter 11.” Essentials of contemporary Management. Boston, MA: McGraw-Hill/Irwin.

McDonald’s Corporation SWOT Analysis. (2004). McDonald’s Corporation SWOT Analysis, 1-9.

Min, H., & Min, H. (2011). Benchmarking the service quality of fast-food restaurant franchises in the USA. Benchmarking, 18(2), 282-300.

Taco Bell makes spicy retort to suit. (2011, Jan 31). Wall Street Journal. Web.

Taco Bell sued for putting too little beef in its ‘meat’. (2011, Jan 25). McClatchy – Tribune Business News. Web.

Winter, S. G., & Szulanski, G. (2001). Replication as strategy. Organization Science, 12(6), 730-743.

Yum! Brands, Inc. SWOT Analysis. (2012). Yum! Brands, Inc. SWOT Analysis, p.1.

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IvyPanda. 2019. "Analysis Chipotle Mexico Grill Company." August 5, 2019. https://ivypanda.com/essays/analysis-chipotle-mexico-grill-company/.

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