Chipotle Industry Analysis Paper
Barriers to entry within the fast-food industry are much higher than the general barriers to enter globally. The cost of establishing a new business in Greece is very high, and with the decline in consumer incomes the overall spending at new restaurants is down. Greek consumers are also very loyal to the brands that already exist within their market, so trying to steer them in a separate direction could prove to be difficult. In regards to a fast-casual, low cost establishment, that is the leading rector in the restaurant industry and could prove to be slightly more attractive (Langkos, 2015).
Chipotle
Chipotle competes in the fast dining industry, which did not exist when it first started more than 20 years ago. Now the company has over
2,000 restaurants, including 36 in international markets (Canada, England, Germany, France and Asia). The customers have come to expect good quality food, cooked with techniques similar to fine-dine restaurants in a casual fast-food setting (Chipotle Annual Report, 2015). The company seeks to use fresh ingredients and know where they are sourced from to ensure they understand the societal and environmental impact of the business. They also focus on working closely with local farmers and source ingredients that are free of any genetically modified organisms. They believe in allowing the animals to roam free and have a natural diet, with a strong belief that there is a direct correlation between the treatment of the animals and the flavor of the food (Chipotle, 2016).
Chipotle has expanded Internationally and they have opened locations within Europe. Most recently, Chipotle opened a location in London and it has not gained much traction. Multiple “Mexican” style restaurants have opened in the UK within the past 10 years, and many of them have been unsuccessful. There is a lack of demand and awareness of Mexican food in the UK and EU alike (Wong, 2013).
Current Major Players Globally
McDonald’s
McDonald’s opened their first store in California 68 years ago. By the 1970’s they began to open close to 500 new stores each year, including multiple locations internationally. In the 1980’s and 1990’s the competition in the market began to increase as new entrants began to enter this previously “blue ocean”. McDonald’s currently operates more than 36,000 restaurants in over 119 countries, one of those countries being Greece. They are globally knows for their inexpensive prices, convenience and the new introduction of healthier options. Upon observation, it was apparent that their location in Athens had a similar business model with almost identical pricing to the stores that exist in the United States. They have a 2 items for $2 menu, they have a list of items for 1 Euro in Greece, which are $1 in America. It appeals to the same customer base, and although they claim to have “healthy” options, if one were to deduct the ingredients they would find that they are likely not organically grown or locally sourced. They do offer breakfast all-day, and plan to expand upon these options moving forward. They currently hold 14% of the total market share globally (Alvarez, 2016).
Chipotle
Chipotle competes in the fast dining industry, which did not exist when it first started more than 20 years ago. Now the company has over
2,000 restaurants, including 36 in international markets (Canada, England, Germany, France and Asia). The customers have come to expect good quality food, cooked with techniques similar to fine-dine restaurants in a casual fast-food setting (Chipotle Annual Report, 2015). The company seeks to use fresh ingredients and know where they are sourced from to ensure they understand the societal and environmental impact of the business. They also focus on working closely with local farmers and source ingredients that are free of any genetically modified organisms. They believe in allowing the animals to roam free and have a natural diet, with a strong belief that there is a direct correlation between the treatment of the animals and the flavor of the food (Chipotle, 2016).
Chipotle has expanded Internationally and they have opened locations within Europe. Most recently, Chipotle opened a location in London and it has not gained much traction. Multiple “Mexican” style restaurants have opened in the UK within the past 10 years, and many of them have been unsuccessful. There is a lack of demand and awareness of Mexican food in the UK and EU alike (Wong, 2013).
Current Major Players Globally
McDonald’s
McDonald’s opened their first store in California 68 years ago. By the 1970’s they began to open close to 500 new stores each year, including multiple locations internationally. In the 1980’s and 1990’s the competition in the market began to increase as new entrants began to enter this previously “blue ocean”. McDonald’s currently operates more than 36,000 restaurants in over 119 countries, one of those countries being Greece. They are globally knows for their inexpensive prices, convenience and the new introduction of healthier options. Upon observation, it was apparent that their location in Athens had a similar business model with almost identical pricing to the stores that exist in the United States. They have a 2 items for $2 menu, they have a list of items for 1 Euro in Greece, which are $1 in America. It appeals to the same customer base, and although they claim to have “healthy” options, if one were to deduct the ingredients they would find that they are likely not organically grown or locally sourced. They do offer breakfast all-day, and plan to expand upon these options moving forward. They currently hold 14% of the total market share globally (Alvarez, 2016).