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1. Identify the key elements of the company’s strategy, and how well the strategy is working. From Page 1 of the case: “Ells’s strategy for Chipotle was predicated on five elements: -serving a focused menu of burritos, tacos, burrito bowls, and salads. - Using high-quality raw ingredients and classic cooking methods to create great tasting, reasonably priced dishes that were ready to be served to customers minutes after they were ordered. - Creating an operationally efficient restaurant with an aesthetically pleasing and distinctive interior setting. -Having friendly people take care of each customer. - Doing all of this with increasing awareness and respect for the environment, the use of organically grown fresh produce, and meats raised…show more content…
Customers can see their meal being created before their eyes unlike some fast-food restaurants where your meal is sitting under a heat lamp until ordered. It is a real plus for customers to be able to see their meal being created before their eyes and being able to personalize it with different kinds of beans, salsa, and condiments. This differentiates Chipotle from other restaurants by marketing a “Subway” style of ordering. This style allows the customer to customize the amount and variety of add-ons to their meal. Customers in this market want to see their meal prepared to their custom needs. Chipotle’s dining / ordering style allows customers to eat in their restaurant or take it out, however, the process of creating the meal is the main…show more content…
While this may not seem particularly special when compared to fast-casual rival Panera Bread's $2.4 million average sales per location, this is not an apples-to-apples comparison; Panera boasts breakfast, catering, and bakery businesses that Chipotle does not possess. Panera's additional revenue also comes at a cost in terms of larger restaurant location requirements and longer store hours. Most Panera locations open at 6:00am, five hours before the typical Chipotle; this is a primary reason that Panera's labor and occupancy costs (37% of revenue in the most recent quarter) are dramatically higher than Chipotle's (29% of revenue), even when factoring in the benefit of Panera's breakfast revenue. For a better comparison, fast casual burrito rival Moe's Southwestern Grill is estimated to generate just under $1 million in sales per location according to Nation's Restaurant News. With this context, it is impressive that Chipotle drives double the sales volume per location as its peer Moe's and approaches the sales volumes of Panera with smaller restaurants and shorter hours. Chipotle began to roll out a catering program during 2013 that is expected to be available in all markets during 2014. While catering comprised less than 1% of total sales for Chipotle in the most recent quarter, management is excited about the possibilities and has noticed an acceleration

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