CHIPOTLE'S SWOT ANALYSIS.
Internal Strategic Factors
Strengths
·
Simple
menu with tasty combinations. The Mexican Grill is famous for its regular and
straightforward menu and offers consumers the flexibility of creating a
thousand delicious combinations. The simple menu is made up of, tacos, salad,
burrito bowls and burritos. Consumers can create unprecedented combinations
from its wide variety of fillings. This creates more value for consumers as
they can create combinations to suit their unique tastes.
·
Very
high-quality food and ingredients. The products of Chipotle are considered a
premium due to its use of freshly grown and organic ingredients. This emanated
from its founding days, when its founder, Steve Ells, gave particular attention
to understanding the growth and production of needed ingredients. Suppliers
with consistent core values became partners, and although this was quite
expensive initially, the company has garnered the brand of providing 'Food with
Integrity.' In its bid to preserve the high-quality characteristic of its Food,
Chipotle does not include microwaves nor freezers in its restaurants. Instead,
walk-in refrigerators store fresh ingredients (spices, herbs and rice) and
prepare food (Guacamole, lime rice, salsa and meat) from scratch every day.
Chipotle uncompromisingly uses animals that are grown with care without the use
of non-therapeutic antibiotics or hormones (Responsibly grown animals). This is
due to its commitment to sustainability and animal welfare.
·
High-quality
Equipment and classic method of cooking. Chipotle uses quality and state of the
art equipment in storing ingredients and preparing daily orders. Its Classic process
involves fresh ingredients, pots and pans, cutting knives, stoves and grills.
·
Attractive
Pricing. In satisfying existing customers and attracting new customers,
Chipotle gives attention to an essential element of its marketing four Ps,
Price. It creates value for customers by offering high quality and tasty food
(fitting diverse tastes). It captures value by setting prices within a range
that allows it to cover its cost and generate profits while being attractive to
customers. The prices for Chipotle's Menu
ranges from $4.40 to $8.00
·
Close
and Valuable relationships with Suppliers. Chipotle views Suppliers as a core
part of its survival and not just a channel member. Thus it has nurtured and
continues to protect its relationships with carefully selected and specific
suppliers that understand and accept its core values and organizational
culture. Reliable suppliers ensure Chipotle is supplied with freshly grown and
responsibly grown vegetables, spices and animals.
·
Innovative
and digitally friendly. Chipotle has proven to be a flexible and innovative
company in staying up with external changes. The company took advantage of the 'age
of mobile apps' by introducing its ordering app. The app enables consumers to avoid
long wait lines during peak hours, and give consumers the convenience of having
their food delivered via Uber eats, Grub hub, Door dash or any other delivery
service. This caters to the needs of multiple target markets and generates more
revenue and profits.
Weakness
·
A
limited number of suppliers. Although Chipotle's relationships with specific
suppliers serve as an advantage in terms of the assurance of high-quality
ingredients, Chipotle's overdependence on a few selected suppliers restricts it
somehow. In the case where said suppliers shut down, are affected negatively by
some external factor or change their view on Chipotle's core values, Chipotle
will immediately run at a loss. This will be because it relies on a few
suppliers alone; thus, there may be no contingency plan on purchasing from other
suppliers. A day lost in sales is worth millions of dollars to the Mexican
Grill. The outbreak of E.coli in 2015 caused the company some significant
setbacks.
·
Limited
food on the menu. Although Chipotle has many fillings consumers can add to
their Burritos, it has a simple menu. This was quite okay initially, however,
with the rise of competitors and sophistication of consumer taste, Chipotle's
simple menu of tacos, salad, burrito bowls and burritos, maybe more of a
weakness than a strength. Consequently, some of its customers spend more at its
competitors' outlets such as Panera Bread.
·
High
Sodium Content. Chipotle's menu is known to have a high sodium content, and
this sends away health-conscious customers, high blood pressure customers and
consumers who dislike salt in general.
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