Chipotle Mexican Grill

This article is about the Mexican Restaurant. For the chili pepper, see Chipotle.

Chipotle Mexican Grill, Inc.

Chipotle Mexican Grill
Company type	Public (NYSE: CMG)
Industry	Restaurants
Founded	Denver (1993)
Headquarters	1543 Wazee Street, Suite 200 Denver, Colorado, 80202
Area served	21 States and the District of Columbia
Key people	Steve Ells, Founder, CEO and Chairman
Revenue	$822.93M USD (2006)
Operating income	$61.95M USD (2006)
Net income	$41.42M USD (2006)
Number of employees	15,000 (2006)
Website	www.chipotle.com

Chipotle Mexican Grill (NYSE: CMG) is a Denver, Colorado-based chain of Fresh Mex restaurants specializing in San Francisco burritos and tacos. Founded by Steve Ells in 1993, the restaurant is known for its chunky guacamole and large burritos. Chipotle is one of the first successful chains in the relatively new category of fast-casual dining establishments. In the past, McDonald's Corporation owned a majority interest in Chipotle. McDonald's has since sold their entire stake in Chipotle; full divestment was completed in October of 2006.

History

Chipotle Mexican Grill originated in Denver, Colorado in 1993. The founder, Steve Ells, still serves as chairman and CEO. He got started in the Mexican food industry after getting a job as a line cook at a restaurant called Stars in San Francisco. He attended the Culinary Institute of America. Over 500 restaurants have since opened throughout the United States. Chipotle Mexican Grill restaurants are company-owned, rather than franchised. In 1997, McDonald's made an initial minority investment in Chipotle Mexican Grill. By 1999, it had grown to a controlling interest, and by 2005, it was 92%. The McDonald's connection allowed the firm to quickly expand, from 14 restaurants in 1998 to 480 at the end of 2005.

On October 25 2005, Chipotle initially filed for its IPO. On December 23, 2005 in an updated filing, Chipotle indicated the size of the offering would be approximately 6.3 million shares with a price of $15.50 to $17.50 per share. The price range was increased to $18.00 to $20.00 per share on January 23, 2006, an indication that the demand for the offering was strong. Morgan Stanley and SG Cowen led the offering. The public offering priced on January 25, 2006, at a price of $22 per share. The offering raised approximately $133M in primary capital to fund new store growth. McDonald's sold $66M, including the 15% greenshoe, which was exercised in full. On its first day as a public company, Chipotle stock rose exactly 100%, closing at $44.00 per share. On September 8, 2006 McDonald's Corp. announced it had started an offer for its shareholders to exchange McDonald's stock for shares of Chipotle Mexican Grill. The exchange allowed McDonald's shareholders to acquire Chipotle shares at a 10 percent discount. The offer is capped at a level of 0.9157 Chipotle shares for each McDonald's share exchanged owned by McDonalds Corporation. On October 13, 2006, McDonald's Corp. completed a tax-free swap of class B common stock in Chipotle Mexican Grill, Inc. (NYSE:CMG), for its own common stock. McDonald's Corp. has now fully divested its investment in Chipotle.

Chipotle said in October 2007, it will add restaurants in Toronto, Ontario, Canada. Its first store will open by the end of 2008. [3]

Menu

Chipotle's menu consists of five types of items: burritos, fajitas, "burrito bols" (burritos without the tortilla), tacos (hard or soft), and salads. The above items come filled with one of the following items: chicken, carnitas (shredded pork), barbacoa (shredded beef), steak, or vegetarian. There are also a large number of items which can be added.

Many of these items are gluten free though the flour tortillas for both the burritos and the small tacos contain gluten. The hot red salsa contains small amounts of gluten from distilled vinegar.

The price depends only on the meat ordered, with the exception of an extra charge for guacamole on non-vegetarian orders.

Additionally, there are several so-called "secret items" not listed on the regular overhead menu. Some of these are listed on the children's menu, such as quesadillas, rice & beans bowl, or individual tacos. Other "secret items" are just combinations of existing ingredients like a sauce based on mixing a "to go" cup with half Tomatillo Red-Chili Salsa and half sour cream .

The exterior of a Chipotle in Orlando, Florida.

Chipotle is also noted for its ability to handle fax orders, making it popular among office workers picking up lunch. In late 2005 Chipotle added the ability to order online using the moniker "DSL" or "Don't Stand in Line". As with faxed-in orders, those who have placed their orders online may skip to the front of the line to pay for their already-prepared food, as long as they have called to confirm their order prior to pick up, and allow 10 to 15 minutes to be prepared.

Chipotle located at the Verizon Center in Washington, D.C., on game night.

Chipotle's menu consists of five types of items: Latching on to popular health concerns, and keeping in line with its "Food With Integrity" mission statement, Chipotle uses several natural ingredients. To date, in some markets, Chipotle has all-natural chicken raised without antibiotics on a vegetable diet, naturally raised pork and beef. Chipotle advertises its support of family farms, such as Niman Ranch (a California "natural" meat producer that contracts with farms in the Midwest to raise pork and other livestock). Chipotle also has vegetarian and vegan offerings. The rice, black beans, fajita veggies, salsas, guacamole and cheese are vegetarian. Other than the meats, pinto beans (with bacon), cheese, sour cream and honey vinaigrette dressing, all other menu items are vegan. The cheese is processed with vegetable-based rennet, rather than the more commonly used animal-based version, in order to be suitable for vegetarians. Additionally the sour cream comes from cows that are not treated with rBGH.

A burrito from Chipotle can contain more than 1000 calories. Nutrition information can be found in PDF format on the official site.

Promotions

People get in line outside a Chipotle in East Lansing, Michigan during a "Free Burrito Day".

Chipotle has run several "free burrito" promotions:

• Tax Day April 15, 2006. A mock tax form BurritoEZ was handed out at Chipotle restaurants. Customers who brought in the completed form on April 15th received a free burrito. Not every location participated in this promotion in 2006.
• Valentine's Day February 13, February 14. Customers were invited to purchase gift cards for Valentine's Day and then bring the receipt to Chipotle on February 13 or February 14 to receive a free burrito. This offer was provided as a flash movie in 2006 while the 2007 invitation is a more simple email.
• National Sports Day February 17 through February 25, 2007. Chipotle had booths in front of major sports arena throughout the West Coast giving free salad and guacamole samples. They also gave free burrito postcards.
• Saint Patrick's Day Parade-Pittsburgh- Handed out free burrito postcards.
• Cincinnati Show Your Stripes Day January 8, 2006. Chipotle restaurants in the Cincinnati area gave free burritos to patrons who wore Cincinnati Bengals attire in preparation for the upcoming NFL playoff game.
• Harvesters 2007. Chipotle restaurants in and around the Kansas City metro area offered free burritos, bols, salads, or tacos to anyone that would bring in a nonperishable food item to donate to harvesters. Free burrito coupons were offered up at some locations that ran out of food supplies early.
• North Texas Food Bank Day June 5, 2007. Chipotle restaurants in the DFW area gave away free burritos to anyone bringing a non-perishable food item.
• Halloween. On Halloween, some Chipotle restaurants offer free burritos to those who wear a burrito costume (wrapping themselves in foil).

Environmental responsibility

Chipotle's architectural design team incorporates the principles of sustainable architecture in all future projects and included many of those elements in existing Chipotles. These include, according to Chipotle communications firm KNS Promotions Inc. in Maryland:

• Time clock/photocell controls regulate lighting levels throughout the day, taking ambient light into consideration. In addition, motion sensors in the restrooms and walk-in cooler further improve lighting efficiencies. This lighting package can exceed code by 30 percent.

• High efficient sprayers are used at the four-compartment sinks, made standard for all new stores as of April 2006, and waterless urinals and hands-free faucets in the restrooms are being tested. One waterless urinal is in use in the Loveland, Colorado location. The Boulder, Colorado store at 29th and Arapahoe also has a waterless urinal.

In 2001, a statement was released by the company regarding a move toward using responsibly and sustainably farmed ingredients in the chain restaurants. The statement reported that the use of these ingredients and the implementation of sustainable architecture were to reflect CEO Steve Ells' philosophy for their food.

Music

All music played at Chipotle establishments is sent to the store from upper offices of Chipotle. This music can be found and sampled under the "Restaurants" section of their website.

Decor

Architecturally, Chipotle restaurants are built using most of the same materials, and many feature an abundance of metal and wood, giving them a faux-industrial, post-modern, art-deco look.

Some Chipotle restaurants also display wood-and-metal sculptures of human figures, made by sculptor Bruce Gueswel to resemble the artistic style of ancient Mayans. Every Chipotle has a picture of the first Chipotle somewhere inside.

Sponsorships

• Team Slipstream powered by Chipotle - A Colorado based UCI Professional Continental Cycling Team established in 2007.

External links

• Chipotle Mexican Grill website
• Interview with CEO Steve Ells
• Yahoo discussion group
• The Chipotle Diet, How to lose weight eating at Chipotle twice a day, every day, unofficial fan site