Chipotle External Analysis

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Chipotle External Analysis

By | December 2010
Page 1 of 13
Restaurant Industry:
Chipotle Mexican Grille, Inc.

TABLE OF CONTENTS

Chipotle Overview3
Industry Overview3
Key Macro External Forces4
Five Competitive Forces4
Major Factors Causing Fundamental Changes4
External Analysis4
Key (or Critical) Success Factors4
APPENDIX – 14
APPENDIX – 24
External Factor Evaluation (EFE) Matrix4
APPENDIX – 34
Competitive Profile Matrix (CPM)4
APPENDIX – 44
APPENDIX – 54
Content Topics4
Bibliography18

Chipotle Overview

Chipotle Mexican Grill, Inc. is a “fast-food service restaurant” under limited service category. It was formed in 1993 and went public in 2006. It has the largest market share in the Mexican-type food segment with a net income of more than $126M in 2009 (Mergent online, 2010). The company spans over 35 states and has over 1000 restaurants across the U.S. and in parts of Columbia district, Canada and England. Chipotle’s menu consists of burritos, tacos, burrito bowls (a burrito without the tortilla), salads, and a variety of extras such as guacamole, salsas and tortilla chips seasoned with lime and kosher salt, cheese, lettuce. The company claims that with its varieties of extras, it’s able to expand its menu offerings to over 65,000 choices (Hoover, 2010).

Industry Overview

The U.S. fast-food industry is expected to generate total revenues of $184.0 billion in 2010, which is equal to a 0.32% share of the economy. Over the next five years (2010 to 2015), the revenue for the industry is expected to grow at a rate of 2.5% per year to $208.2 billion (Appendix 1 – Table 1). Due to the projected improvement of the domestic economy, the number of establishments and the number of enterprises are forecasted to increase at a rate of 1.7% and 1.3% per year, respectively. This means that new entrants will enter the market at a slower rate than the existing fast-food chains increase their branches (IBISWorld, 2010). The industry concentration, which is the...

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