3. Presentation Agenda
1. Company Snapshot
2. Trends
3. Porter’s Five Forces Model
4. Resources and Capabilities
5. Diagnosis
6. Strategies
4. Company Snapshot
• Locations in large, populated cities especially along the coasts
• Fast-Casual environment
• Quality ingredients from local suppliers
• Loyal customers
• Jason Mraz supplies avocados to Chipotle
http://www.huffingtonpost.com/2015/01/13/jason-mraz-avocado-farmer_n_6430822.html
5. In the News
• E. coli: July, 2015
• Norovirus: August, 2015
• Salmonella: August and September, 2015
• E. coli: October, 2015
• Norovirus: December, 2015
• E. coli: December, 2015
http://a57.foxnews.com/images.foxnews.com/content/fox-news/health/2015/12/08/30-boston-college-students-sickened-after-eating-at-chipotle/_jcr_content/par/featured-media/media-0.img.jpg/876/493/1449546512064.jpg?ve=1&tl=1
8. Trend: Aging Population
Millennials are the Future
- Higher quality food
- Affordability
http://yourmarketingdepartmentct.com/millennials-what-makes-tick/
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
9. Porter’s
Five Forces
Analysis
Power of
Suppliers
Power of
Buyers
Threat of
Competitive
Rivalry
Threat of
New
Entrants
Threat of
Substitute
Products
Porter’s Five Forces
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
10. Power of Suppliers: High
• Concentration
• Product differentiation
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
https://www.chipotle.com/food-with-integrity
11. Power of Buyers: High
• Switching costs
• Threat of backward
integration
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
http://www.gettyimages.com/detail/news-photo/bags-of-chips-are-seen-
ready-for-customers-in-a-chipotle-news-photo/471371484
12. Threat of Competitive Rivalry:High
• Number of
competitors
• Switching costs
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
http://hackthemenu.com/taco-bell /secret- menu/
http://cincinnatizoo.org/events/wild-about- wine/qdoba-logo/
24. Encourage & Educate Customers: Cons
• Competitive parity
• Limited impact
• New food preparation - must be effective
• Too little, too late?
https://lh3.googleusercontent.com/-SJlYRlsdfOOLU8l6D5SfvBdE5yfA6f7rCAYHIIRJyjkVJBGgzA8JlZv8_mvJvmS
Tnk=w300
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
25. Backward Vertical Integration
• Become our own supplier
– Complete control over ingredients/products
• Encourage safety to customers
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
26. Backward Vertical Integration: Pros
• Establishes control over ingredients
– Decreases the risk of disease
• Reduces cost in the long run
• Decreases buyer power
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
27. Backward Vertical Integration: Cons
• Expensive
• Difficult to implement
–Lengthy process
http://www.chenxicartridge.com/why-are-name-brandgenuine-toner-cartridges-more-expensive-than-compatibles/
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
28. “C2C” Strategy
• Hire management that specializes in public relations
• Implement a subscription based membership program
–$15 monthly subscription
–3 meals included and unlimited beverages
–App ordering and a pickup only lane
–Points tracker for meals purchased
–Refer a friend incentive
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
29. “C2C”Strategy: Pros
• Revitalize Chipotle’s image
• Decrease buyer power
• Acquire new/existing customers
• Reasonable cost and time to implement
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
30. “C2C” Strategy: Cons
• Getting initial customers to commit
• Attracting new customers
Trends Porter’s Five Forces Resources & Capabilities Diagnosis Strategies
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