CHIPOTLE: MEXICAN GRILL, INC.: FOOD WITH INTEGRITY Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

CHIPOTLE: MEXICAN GRILL, INC.: FOOD WITH INTEGRITY Case Solution

Problem Statement

The year 2012 proved to be typical year for the company because of the increased inflationary trends in the cost of the products which the company is providing.Moreover, the company was also faced with tough competition in the industry. Therefore, with the challenges of providing the products with the use of natural ingredients in order to emphasize its commitment to maintain its current status, as well as the competition prevailing in the market, the company needs to come up with the strategy to grow with fast pace.

With the help of Dr. Michael Porter’s 5 forces model, the competitive position of the company can be analyzed. The analysis of these forces can help the company in achieving the vision of the company with regards to its growth.

Porter 5 forces Model

Bargaining Power of Buyers low

With the help of the market analysis, it can be seen that the company is not much under the influence of the buyers of the product as the prices that the companies are charging are quite reasonable and there is not much difficulty for the customers because of its stability. The price for the products is quite stable even under the increasing number of customers for the related products.

Bargaining Power of Supplier low

In order to fulfill the mission of the company regarding the food with the integrity, the company focuses from the scratch which is the key to success for its brilliant growth. The company maintains different supply chains with the complete protected environment. Moreover, the company in order to cut its cost of travelling to procure the material proposed a program to increase its local growth which resulted in a significant decrease in the bargaining power of supplier, which helped the company to focus on other development issues. Furthermore,it can be seen that some of the material can easily be procured with the help of the local stores.

Threat of New Entrants high

The first and the foremost concern for the company which is also the force acting negatively is the threat related to the new entrants for the similar business. It can be seen that in order to run the business there is no kind of expertise required. Therefore, the labor force can be achieved cheaply. In order to start the business there is not much capital required as compared to the other kinds of businesses. Thus,by looking at all these factors, the biggest threat of the company is the threat of the new entrant because of no barriers.

Threat of Substitute Products high

The second biggest threat for the company to earn good return is the threat of the substitute products. It can be seen that with the help of investing capital and employing staff and the other expenses, the products which this company is producing can easily substituted by lot of other variables. The easiest is the one that the people can make such kind of stuff easily at their homes which is the biggest threat for such a business to run in the long run. Moreover, the prevailing grocery market in the country also provides those stuff in the shape of east to make as well as ready to eat products which the customers can easily purchase to enjoy those items. Furthermore, the fact that the people don’t always focus on only one restaurant rather they try and keep switching to other one is also one of the biggest threats for this company. Therefore,it can be concluded that the threat of substitute for the products is relatively high for this company.

Competitive Rivalry moderate

This force for analyzing the company is relatively moderate. The companies in this industry compete on the basis of location, style as well as presentations of the products, food quality, hospitality as well as services which is the key to success in this kind of industry, and other factors.................

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