What makes you choose one restaurant over another? Especially in the area of Mexican cuisine, what sets a restaurant apart from the others? Is it the consistency of the guacamole, or the texture of the tortillas that are used?
As described in David Chernenko’s blog post, the Mexican fast food chain, Chipotle, has achieved unparalleled success with the “fast casual business model.”[1] With 1900+ stores as of 2015, and annual revenues of over $4.1 billion[1], Chipotle has created its own signature dining experience that appeals to approximately 750 000 diners every day[1]. Not only does David discuss the differentiation factors behind Chipotle’s prosperity, he also highlights the company’s effective operations management and resounding value proposition that have hooked the millions of burrito-lovers that Chipotle has served.
One of the key characteristics that serves as Chipotle’s point of difference is its unique philosophy of serving “Food with Integrity.” This core value of serving fast food with ingredients that are sourced within 350 miles of the receiving store[1] particularly appeals to health-conscious customers. There is a general growing popularity in fresh, organic, non-frozen, and cruelty free food, which results in a positive public reception from the targeted customer segment. This simple and honest concept fostered by founder Steve Ells effectively impacts the value proposition of the company. In comparison to other fast food chains, Chipotle is portrayed as a higher-end and healthier food chain[2] that is dedicated to serving high-quality and customizable foods at generous portions.
Additionally, David mentions that each location of Chipotle is centrally controlled by the corporation[3] in comparison to the franchise model. It is very rare for a fast food chain to own and operate, but Chipotle’s masterful business model has allowed them to be heavily involved in the dining experience and quality control of food. Although this may seem like a negligible factor in the eyes of a consumer, this allows Chipotle to strictly oversee every detail and component within the customer’s dining experience. Furthermore, through the utilization of a standardized operation model, Chipotle has seen an increase in profitability compared to competitors using franchise models.[3]
Overall, Chipotle’s usage of a clear branding message has allowed it to excel well beyond its competitors. Through the implementation of a compelling and transparent business model, customers find themselves gravitating to this company-owned-and-operated Mexican food chain. Although Chipotle’s food is sold at a higher price point and at a larger size than regular portions, its customizable and efficient characteristics have created a loyal and strong consumer base.
word count: 417
-
Zheng, M. “Chipotle Nation.” Operations and Technology Management. N.p., 28 Nov. 2016. Web. 30 Oct. 2016.
-
Li, Sam. “Chipotle: It’s Not the Burrito – It’s the Operating Model.” Technology and Operations Management. N.p., 9 Dec. 2015. Web. 30 Oct. 2016.
-
Roemmele, Brian. “What Are the Keys to Chipotle’s Success?” – Quora. N.p., 20 Aug. 2011. Web. 30 Oct. 2016.