The Sexy Six Company History Started in 1993

The Sexy Six

Company History Started in 1993 by Steve Ells in Denver, CO with the idea that food that is served fast does not always come with the “fast-food” experience He wanted to use high-quality, local ingredients, classic cooking methods, and a fine-dining atmosphere. Chipotle would offer “a few things, a thousand ways. ” Mc. Donald’s invested in the company when they had only 16 restaurants. They handed resources and guidance down to the young company for 8 years, helping it grow to the publicly traded company that it is today During the year of 2014, Chipotle opened 192 new restaurants, bringing their total restaurant count to 1, 783. The fourth quarter of 2014 shows a 26. 7% revenue increase from the fourth quarter of 2013.

Vision, Values, Goals Vision To change the way people think about and eat fast food Values ü Support and sustain family farmers who respect the land the animals in their care ü Use meat from animals raised without the use of antibiotics or added hormones ü Source organic and local produce when practical ü Use dairy from cows raised without the use of synthetic hormones Goals Use higher-quality ingredients and cooking techniques to make great food accessible to all people at reasonable prices.

Map the Industry Raw Materials Farmers/Ranchers Industry Boundaries Product Scope: Fast-Casual Restaurants Geographic Location: United States Distributors Restaurants Consumers Competitors: Panera, Five Guys, Zaxby’s Qdoba Mexican Grill, Einstein’s Bros Bagels, Boston Market, Panda Express, Jimmy John’s, Noodles & Company

Assess Profitability Farmers/Ranchers Meat Dairy Vegetables Paper products Plastic products Dining equipment Bargaining Power of Suppliers Potential Entrants International Quick Service T hrea t from restaurants New Entr Non-Quick Service ants restaurants Buyers Individuals Teams Business rga Ba g inin P er ow Fast-Casual restaurants Panera, Five Guys, Zaxby’s, Qdoba Mexican Grill, Einstein’s Bros Bagels, Boston Market, Panda Express, Jimmy John’s, Noodle’s & Company rs uye of B Po we bst f Su ro e Pow r of Co mp lem ent s s itute Substitutes Full-service restaurants Fast-food Casual restaurants Buffets Caterers/refreshment stand vendors Retail-host restaurants (Gas stations/grocery stores) Complements Soft-drinks Juice Snacks

Force Factors Product costs % of total? 33. 4% Bargaining Power of Suppliers Concentration of suppliers? Yes Switching costs? Low Strength Profit Impact Low Bargaining Power of Buyers Product differentiated? Yes Criticality? Yes Switching costs? Low High Rivalry Among Existing Firms Industry concentration Very high Diversity of competitors High Product differentiation Med Low Threat from New Entrants Capital requirements Low Economies of scale Yes Product differentiation Yes Access to channels High Expected retaliation Low Threat of Substitutes Buyer propensity to substitute High Product differentiation High Power of Complements Mutually beneficial industries? Yes Stronger market position? No Low Neutral

Industry Key Success Factors 1. 2. 3. Strong brand image to help distinguish restaurants from their competitors • Branding might involve focusing on bold flavors, fast preparation of special orders, better ingredients or healthier diets. • “By Technomic's estimation, there at least 10 different markers of restaurants that fall within the category: the quality of the food, the use of better ingredients, food that is wholesome, a perception of freshness, first-rate decor, fair pricing, fast service, friendly employees, flexible offerings, and a full view of how the food is prepared. ” The quality of products that a restaurant provides their customers determines how successful they are • “It’s generally acknowledged that fast-casual concepts are hybrids of quick-service and casual dining that provide counter service and offer more customized and freshly prepared dishes than traditional quick-serves, all in a upscale, inviting atmosphere. ” • “Fast-casual menus feature a wider, more daring range of ethnic fare, which gives chefs and consumers the opportunity to try new tastes. ” Restaurant layout • 4. “In the design of Fast Casual Restaurant Concepts, the restaurant consultant working with the customer, starts with the menu, develops the service model and the menu boards. The service model as the interface between the customer and the restaurant team, dictates the rest of the design and layout. ” Price • “They offer some dishes at around the same price as [those at burger joints], but they seem to be better than Mc. Donald’s at nudging diners towards pricier dishes and extras. Fast-casual chains typically manage to squeeze 40% more out of each diner’s wallet than fast-food joints do. ” • The sector still maintains its traffic count indicating that people prefer quality and hygiene over a rise in item prices.