Chipotle Management Case Study

It’s been over a year since the E.coli outbreak and Chipotle and some other poor performance of Chipotle management such as the law sue about the sexual assault and unpaid wages. We’ve seen that it’s very hard for Chipotle to reestablish customer trust. However, at this point, it’s very unlikely that Chipotle will have another foodborne illness in a near future. It will probably take some more time, maybe additional 12 months for people to start trusting Chipotle again. I think that it’s very unlikely that American people will stop eating burritos and tacos at Chipotle and I believe that after some time without any scandal about food safety issues, the customers will start returning to Chipotle that will increase its revenues and consequently, profits again.
The second
In the short-run, I think Chipotle’s performance will probably remain poor. We’ve seen stories like Chipotle and even worse before, such as McDonald’s and Jack in the box having trouble about E.coli foodborne illness and even some people died because of this. However, they’ve been able to turn around their stories and make their companies grow again. Therefore, I think that if the management will be good, sales will come back to Chipotle in the long run. Although it’s important to remember there are a lot of risks associated with buying Chipotle’s stock and the investor probably needs to be a bit risk adverse to buy its stock. Chipotle has been one of the success stories of the fast food industry and I believe it has a huge chance to turn its story around to being a success story again. On the question if you should buy CMG stock, I’d say yes and you should also hold your position in the company if you already have its stock, but I think it’s also important to remember all the pros and cons associated with this stock and decide whether it’s something you want to do or you might prefer buying a safer stock with less perspective