Chipotle isn’t doing so hot right now. Despite all the free chips and guac and burritos in the world, the fast casual Mexican food chain is having a hard time bouncing back from a norovirus outbreak that keeps rearing its ugly head. Wall Street thinks the chain won’t bounce back for another two years because customers currently don’t want to play diarrhea roulette with their cheap lunch options.
So what’s the company’s natural next step, besides the CEO taking a haircut with his compensation plan? A pivot…
The genius business idea: Burgers, according to Mashable:
Chipotle Mexican Grill confirmed on Wednesday that the company has applied for the trademark for “Better Burger,” a move that signals what could be a new chain under the Chipotle empire.
Chipotle already runs two other chains in addition to its flagship Mexican restaurants — the Southeast Asia-inspired ShopHouse and Pizzeria Locale.
Color me underwhelmed. This feels like waving the white flag of fast food defeat. Are burgers the only bucket you have to bail our your lifeboat, guys? Burger fast food restaurants may be a $73 billion business, as cited by Mashable, but it’s hardly reinventing the culinary wheel.
I have a hard time thinking they can compete with Shake Shack’s plans for global “better burger” dominance, along with other growing and established players in the space. In-N-Out, Whataburger, Burger Fi, Fatburger, Crunchburger, BGR, Umamai Burger. The list goes on and on and that doesn’t even include the firmly-seated titans like McDonalds, Burger King, Wendy’s, Carl’s Jr., etc. No one is knocking those guys off their thrones except for the people already in the space.
The interesting thing about the move is how it’s rooted in Chipotle’s history. As Mashable notes, McDonald’s once owned 90% of Chipotle before they spun out the stock in 2005. Over the last ten years Chipotle has thrived (until lately) while McDonald’s has struggled.
The whole thing just feels like a football coach pulling out a trick play that worked 30 years ago when he was in high school himself.
So… Will you try it?