Description

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.