Is Chipotle doomed as a company?

By | September 29, 2016

OMG, let’s go to Chipotle!

What was once the biggest trend since the macarena is now a wasteland. Radioactive and corrupted. Suggesting eating at Chipotle is like suggesting everyone eat out of a dumpster. Sure, you might be fine. But why take the risk?

Two years ago, everyone loved Chipotle. At my local branch, there was a line out the door when it wasn’t even lunch time. People thought it was like a Mexican Subway but trendier and better for you because there’s less carbs.

Then June 2015 hit. E. coli strikes. It happens. Sometimes, people don’t wash their hands. It’s understandable. It was probably just an issue with that restaurant and not a problem with the chain.

But month after month, different states were reporting illnesses caused by Chipotle. So clearly, this wasn’t an issue with a specific restaurant, this was a problem with the franchise.

Chipotle was so popular that my Facebook feed was inundated with posts about being at Chipotle or wanting Chipotle. Now I can’t even remember the last time someone mentioned them without immediately mentioning E. coli.

Are they doomed?

Well, according to my “research”, three different fast food chains had food scares like this: Wendy’s, McDonald’s, and Jack In The Box.

Wendy’s, McDonald’s and Jack In The Box are both still going strong.

But Chipotle is different. Chipotle’s been around just over 20 years. (They were founded in Colorado in 1993.) Now that sounds like a lot, but they didn’t get out of Colorado until 1998 and they didn’t expand internationally until 2008.  So we’re looking at a relatively young restaurant. (Now, Wendy’s was roughly the same age when their outbreak hit but that was only at one restaurant.) They had just started to integrate into the consumer consciousness of America when this happened.

But let’s assume for the sake of argument that they are big enough to weather this kind of hit. Let’s focus on their brand. When I talked to people about Chipotle, the things they’d mention were that its fresh and it’s healthy. An e coli outbreak is the worst possible thing that this brand could have had happen to it.

Recently, Chick-fil-A was embroiled in controversy because its CEO opposes same sex marriage. Some people don’t eat there anymore, but no one was eating Chick-fil-A because they believed in same sex marriage. They were eating there because they liked their chicken.

This is why I believe Chipotle is doomed. Their brand is tainted. If they can pivot and just become a place you get burritos, they’re golden. But “fresh” and “healthy” are not words that are going to be associated with Chipotle in the near future.

Now, probably, they might survive. I can’t tell the future. But in the next five years, if you see restaurants in the chain start to close down, that’s a clear indicator that the chain will be going the way of Fresh & Easy.

 

 

 

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