Many companies are famous and earn millions of dollars, but they still have some problems that they need to solve. Different companies have a different ways of work, different earning methods, different areas, and different customers. So, it is not easy to find out exactly what could be done to improve the company. But, we can look for things that are common to all the companies, and that is their strengths, weaknesses, opportunities, and threats. This analyzing method is called SWOT Analysis in which, people try and find out every different point of a company, and it easily helps them to change the game. In this article, you will be understanding about SWOT Analysis on the famous American fast food joint Chipotle.
Chipotle Mexican Grill is one of the best and most famous fast-food restaurants joint, has many things that need to be mentioned, With the help of Swot Analysis, it can be done easily and smoothly. Chipotle was started in 1993, on 13th July. It was founded by Steve Ells, in Colorado. With the growth and success of the restaurant, McDonald’s started investing in it, and in 1998, Chipotle had around 16 more restaurants. After around eight years, in 2006, McDonald’s deprived out of Chipotle, and afterward Chipotle had around 500 restaurants. In 2015, Chipotle was in different locations other than the United States. Chipotle was available in the United Kingdom, Canada, France, and Germany. Chipotle had more than 45,000 employees and an income of around $470 million.
Chipotle specializes in American-Mexican-style foods. They are most famous for tacos and burritos. They offer other types of food as well like salads, nachos, quesadillas, etc. They don’t have any ovens, can openers, or freezers. They are proud that everything is made in the restaurant’s kitchen and not pre-made.
What is SWOT Analysis?
The full form of SWOT is Strengths, Weaknesses, Opportunities, and Threats. SWOT Analysis is a method that is used to keep in check any type of company or a situation. It is one of the best ways to make sure what a company or a situation is and what it needs to be or become more successful. SWOT-analysis helps to pinpoint the condition of a company in all important areas. So, it is used to find the problem and also the solution of the company.
If you are interested in the Swot Analysis of Chipotle, continue reading the article.
SWOT Analysis of Chipotle:-
- Food– The food served at Chipotle is delicious and mouth-watering. The food they serve is always fresh. The food they make is always made in their kitchen. The quality of the food is not compromised at all. The quantity of the food is also decent, and the most important part is that the customers really like the food, and they always come back.
- Cooking Method- The method they used to make their food is amazing and it gives every meal its flavor. They use the traditional way of cooking and use grills, pots, pans, fresh ingredients, etc. They don’t use the method of batch cooking in which a huge amount of food is cooked at a time which is then served. Also, the customers enjoy the traditionally made food.
- Pricing– The price of the food they serve is not too expensive. Considering the amount of food they serve, the price of the food is justified. The menu compromises food ranging from $1.50 to a maximum of $8 to $9.
- Locations– Chipotle is not available only in the United States, it is also available in the United Kingdom, Germany, France, Canada, and many other countries. It has around 2700 restaurants worldwide. Most of the restaurants are located in the United States of America, and more than 40 are outside the United States.
- Suppliers of Chipotle- The suppliers are well connected with Chipotle. To make sure that they serve good quality and fresh food, they need to have a good relationship with the supplier and they do have that.
- Digitalization– Chipotle built an app to use for the customers to order their food in advance and be able to get their food without wasting the time in lines. This method saves time because most of the customers don’t want to wait in lines at peak hours. Due to digitalizing, Chipotle’s revenue was also grown around 7%. It was around $5.6 Billion in 2019 and it has grown around $5.9 Billion in 2020.
- Customers– Chipotle’s customers are supportive and love the food and services Chipotle offers. A large number of customers do come back again for the great quality food and services.
- Limited Suppliers– The suppliers working with Chipotle are not large in numbers. The suppliers are an important part of the Chipotle business as they are dependent on the suppliers for their quality and fresh food. If any of the suppliers are not able to do their job, Chipotle could face big problems.
- Use of Sodium- Chipotle serves food that is spicy as well as salty. There is a lot of sodium content in the food of Chipotle, and for some individuals, it could affect their health and it could also increase blood pressure.
- High delivery charges– Recently they increased their delivery charges by 9%. They are charging around $10.20 for an $8.50 item. So, it is high for a delivery charge. Because of this, they could lose many customers.
- Short menu– Chipotle is famous for its food, but it sure gets problematic when they serve you only a few items. For many individuals, it is very comfortable that restaurant serves only a few items that will always be available, but if we are considering the normal public demand, they want something new every time.
- Not expanding the market– Chipotle does have many restaurants around the world, but they are very slow to grow outside the United States. They only have around 40 restaurants outside the United States which could affect their international market. They should expand by opening new restaurants in different countries.
- Food Safety Issue– In 2018, around a thousand people or more got sick by eating Chipotle food. It became a massive issue for the public and Chipotle as many regular customers were hesitant of eating Chipotle food. Chipotle was fined $25 Million for food safety. People are still hesitant to go there.
- Going with the Competition– Chipotle should go with the current market competition and change its strategy a little bit. They should change or create new things that will help them grow in the fast-paced American food industry. They could start serving new items, increase presentation, open new joints, increase the speed of the orders, create more jobs, etc.
- More Digitalisation– Doing business online or on a digital platform, has made Chipotle more successful than ever. They have increased their revenue and their online sales because of the online market. They have increased their online sales by around 175% in 2020, because of the pandemic. There is a chance for everyone in the online market so, Chipotle could easily expand their business.
- Expanding Globally– Chipotle only has limited restaurants outside the United States in Canada, Germany, France, and United Kingdom. They should expand their business in other countries for the company’s growth. They could easily start their business in the Asian countries as their food market is the biggest in the world.
- Improve Delivery– Chipotle needs to decrease the charges. They are charging a high amount of money on deliveries. They also need to start partnerships with delivery companies to deliver food efficiently and cheaply.
- Healthier meals– As Chipotle does have healthy items on their menu they could also add some healthier options. They did add some items that were popular with customers. So they should go with the customer’s requirements.
- Increasing items on Menu- Chipotle doesn’t have a lot of options on the menu to choose from. They should add some more items to choose from to their sales.
- Food safety Issue- The numbers of customers are not increasing as fast as they should because of the 2018 food safety issue which costs Chipotle a $25 million fine. Even today, people are not taking any chances and not going there. This situation is now normal as the customer numbers are increasing but not lowering. But the situation could be reversed.
- International Market– If Chipotle didn’t increase their business outside the United States, it would make their problems worse. They should start doing business in different countries and start building their business strong. Also, they should open more restaurants in the United States.
- False Information– They should not spread false information regarding anything if they are related to it or not. They have to go through the problem of falsely claiming that their food has low calories compared to other restaurants.
- Limited Suppliers– Due to the fewer number of suppliers, Chipotle has a risk of collapsing if any of the suppliers is not able to supply the items and products. They need to increase their number of suppliers to increase their business. The problem of limited suppliers could also be the problem of not expanding worldwide.
- Competition– There is tight competition between Chipotle and other Companies. Many companies are selling similar types of food and also increasing the items on their menu. Without giving them a hard competition or doing nothing about the competition, Chipotle could face many problems.
This is the SWOT analysis of Chipotle.
As Chipotle is part of the most famous fast food industry, it is not a hidden fact that Chipotle will face big competition. Here is a list of all the competitors of Chipotle:-
1. McDonald’s- It is true that they serve entirely different food but they do serve food. McDonald’s is an old competitor of Chipotle. Although, McDonald’s once helped Chipotle to become what it is today.
2. Taco Bell- Chipotle and Taco Bell, both serve the same type of food and Taco Bell is one of the largest fast-food companies with around 7000 stores.
3. Qdoba Mexican Eats- It serves the same type of food, and is also smaller than Chipotle in business. Qdoba has the potential to easily give competition to Chipotle.
4. Moe’s Southwest Grill- It is also in a similar cuisine and smaller than Chipotle, but it is rapidly growing with help of advertising with a celebrity named food items. It is giving a good competition to Chipotle.
5. Baja Fresh Mexican Grill- It is a famous Mexican-style restaurant with a large variety of items on its menu. As of now, they are only available in a few areas because of fewer locations they are giving serious competition to Chipotle because of the menu.
This article did a SWOT Analysis on the famous fast-food chain Chipotle. It shows that Chipotle has many Strengths and Opportunities, but also some Weaknesses and Threats. It is not that Chipotle cannot do anything about these things it can make use of the above points and change the direction of its business in the right direction. They also have many competitors who are growing at a fast pace. They are doing many things to grow their business, and Chipotle should observe and use the competitor’s moves on them.
Frequently Asked Questions
1. Can I order a burger at a Chipotle?
Answer-No, you cannot order a burger because Chipotle doesn’t serve these types of food items, as their cuisine is American-Mexican.
2. Which fast-food franchise is the most serious competitor of Chipotle?
Answer-Taco Bell could be the most serious competitor of Chipotle, as it is the biggest fast-food franchise similar to Chipotle.
3. Is eating Chipotle food give you food poisoning?
Answer-No, the food there is of high quality and fresh. But there was a food safety issue in which thousands of people got sick after eating there.
4. Is Chipotle available in Canada?
Answer-Yes, there are some restaurants available in Canada.
5. Can I order chipotle food online?
Answer-Yes, you can order Chipotle food online with their app or any other delivery platform that delivers Chipotle food.