Chipotle Becomes Another Boring Chain — and That's a Good Thing
Niccol’s first year brought stock back near pre-crisis levels
Next up: More stores abroad and intensifed food-safety focus
By Leslie Patton, Bloomberg
March 14, 2019
Brian Niccol has stabilized Chipotle Mexican Grill Inc. since taking over a year ago. Now, he faces a trickier challenge: Restoring some of the burrito chain’s foodie cachet while simultaneously fueling ambitious growth.
Niccol, who took over from founder Steve Ells last March, has cleaned up Chipotle’s operations and tapped the fast-food playbook he learned while running Taco Bell. That includes propelling sales with digital orders and deliveries while adding customer-luring menu items like quesadillas.
“We have to remind people why they fell in love with the brand, and why they will continue to stay in love with what Chipotle can do,” Niccol said in an interview about his first year at the company and his outlook going forward.
Under Niccol’s guidance, Chipotle has steadily recaptured same-store sales growth -- a key gauge of success for restaurant chains and retailers. Investors, including activist Bill Ackman, have applauded, with Chipotle’s stock doubling over the last year. It’s currently approaching the price where it traded before a food-safety crisis engulfed the chain in late 2015.
“Brian and his team have done an incredible job transforming Chipotle,” Ackman said in response to questions about Niccol’s performance. “We could not be more enthusiastic about the progress to date and the future potential to be realized thanks to his leadership.”
Niccol now wants to double the number of Chipotle restaurants in the U.S. and is looking abroad to expand the company’s limited international footprint.
Former chief Ells, a trained chef with culinary aspirations, was credited with creating a fast-food chain that had captured the discerning stomachs of millennials. But serving fresh food soon became a liability, with an E. coli outbreak setting off a food-safety crisis that exposed flaws in the company’s protocols and operations. Ultimately, hundreds got sick, customers fled to rivals, and the company’s market capitalization plunged by more than $16 billion in the three years through Feb. 13, 2018, shortly before Niccol took over.
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