Chipotle has been addressing customer complaints regarding portion sizes by offering generous portions to customers. Interim CEO Scott Boatwright mentioned that customers have been sharing photos of their big burritos and bowls on social media, showing their excitement about the portions they are receiving from Chipotle. This is a stark difference from earlier in the year when TikTok users were requesting additional toppings on their orders.
The company is focusing on delivering value to consumers, especially in the current economic environment. CFO Adam Rymer also mentioned that Chipotle had increased its ingredient usage in the previous quarter to ensure consistent and generous portions. However, the company faced higher costs for items such as avocados and dairy. Despite these challenges, many firms on Wall Street saw the decision to increase portion sizes as a smart move, and some even raised their price targets on the stock.
CFRA Research Senior Vice President Arun Sundaram stated that Chipotle had no choice but to increase portion sizes due to the backlash it faced on social media. Sundaram believes that the larger portion sizes will drive more traffic to stores, along with other initiatives like limited-time offerings. Former CEO Brian Niccol also emphasized that generous portions have always been a core brand equity of the fast-casual restaurant chain, and there was never a directive to provide less to customers.
In response to the customer complaints, Wells Fargo analyst Zachary Fedam conducted a study on different Chipotle orders. Fedam and other finance professionals ordered and weighed 75 like-for-like burrito bowls across eight locations in New York City. They also compared the difference between online and in-store orders. The study found that the smallest bowl weighed 13.8 ounces, while the largest weighed 26.8 ounces. However, there was significant variation in consistency across locations, with some locations serving bowls that weighed significantly more than others.
Overall, Chipotle has made a strategic decision to increase portion sizes in response to customer feedback. The company is focusing on delivering value to consumers and ensuring consistent and generous portions in their offerings. Despite facing higher costs for certain ingredients, Wall Street analysts view this move positively, seeing it as a way to drive incremental traffic to stores. Chipotle’s commitment to providing generous portions has always been a core brand value, and the company’s efforts to address customer concerns have been well-received.
