Key Takeaways
- Earlier this year, diners and social media users began to complain about portion sizes at Chipotle restaurants.
- On Wednesday, executives at Chipotle said there was never a “directive” to make portions smaller and that the company is working to address quantity issues at some restaurants.
- Those efforts will hit Chipotle’s costs for a while, executives said.
Score one for the internet: Fresh-Mex giant Chipotle Mexican Grill (CMG) says it’s rededicated to convincing consumers that its bowls and burritos are as big as customers want them to be.
“Our guests expect this now more than ever, and we are committed to making this investment to reinforce that Chipotle stands for a generous amount of delicious, fresh food at fair prices for every customer, every visit,” Chief Executive Officer (CEO) Brian Niccol said on a Wednesday earnings conference call with analysts, a transcript of which was provided by AlphaSense.
Chipotle shares were recently down almost 1% at $51.38 as of 1:45 p.m. ET Thursday, eating into the stock’s year-to-date gains that are currently about 12%.
Meals Measured by Analyst
Niccol’s comments came after Chipotle diners and social media users began to voice concerns that their weren’t getting as much food as they were accustomed to. That spawned reams of news coverage, as well as an investigation of sorts by a Wall Street analyst who bought and measured dozens of Chipotle meals.
“There was never a directive to provide less to our customers,” Niccol said. “Generous portions is a core brand equity of Chipotle. It always has been, and it always will be.”
What the company says: Consumer surveys indicated that there were some “outlier” restaurants turning in lower portion scores, so it’s training and coaching to fix that—as well as spending to make sure that at those restaurants, customers are happy, an effort that it expects to noticeably lift expenses for a while.
“We decided that this brand equity called generous portions is something that we don’t want to take for granted,” Chief Financial Officer (CFO) Jack Hartung said on the call. “We don’t want to take something that’s been a positive for all these years and then have it turned out to be a negative because of some of the social media comments.”