Chipotle Versus McDonald's: Why Chipotle is Kicking Ass

Categories: Musings
thisiswhat.jpg

titleopportunity1.jpg

Why is Chipotle growing at three times the rate of McDonald's? Because Chipotle "finds new products, new marketing themes, even a new shop concept, Southeast Asian Grill," reports Adam Hartung in VC blogs.com. The chain's commitment to trends and "food with integrity" is fueling growth, a contrast to its initial investor, McDonald's, which remains committed to speed and consistency.

Chipotle's no-hormone dairy and local meat translates to skyrocketing growth, from 16 locations in 1998 to 1100 today, with revenues doubling between 2005 and 2011.

True, McDonald's earned a 1.5 billion when Chipotle went public in 2006, after investing $360 million in the fledgling company in 1998.And yet for the foreseeable future, says Hartung, the chain struggles to find areas for growth (partly because the company has already saturated the market.) "In its effort to generate revenues, recently McDonald's brought us a re-introduced 20-year-old product called McRib this October a product whose ingredients have people asking questions about health and safety."

Has Chipotle's product really earned this loyalty? Is the nutritional value of the burrito versus, say, a Big Mac, really all that different? The burrito is on par with the Big Mac in nutritional value, reported The Atlantic Monthly last year.

The Big Mac is lower in sodium, cholesterol, sodium, and carbs, while the burrito offers more protein and the daily allowance of fiber. "Granted, it may very well be the case that,could we factor in the preservatives, glutens, gums, and other unhealthy additives, these results would be tempered, " wrote James McWilliams.

"Still, given our national health situation--an increasing prevalence of high blood pressure, high cholesterol, diabetes, obesity, and heart disease--neither the Big Mac nor the Chipotle burrito deserves anything close to a nutritional gold star."

The McDonald's versus Chipotle argument is a fast food thread of the Paula Dean versus Anthony Bourdain debate. Or the same one characterized by New York Times' Frank Bruni as one between the "paternalists" --who can afford to shop farmers' market prices and dine in politically correct farm-to-table restaurants-- and "populists" --who chalk up bar food as a balanced meal and consider fries as a serving of vegetables. The paternalists, after all, might not blink when it comes to paying $5.25 to $7.25 for a vegetarian or a steak burrito. Folks who prioritize saving money will go for a Big Mac that runs about $2.99.

"Can you imagine if McDonald's bragged that it was 'using everything but the moo'?" asks McWilliams. Perhaps, he suggests, we're letting restaurants that tout sustainability off the hook.


New Times on Facebook | Clean Plate Charlie on Facebook | Melissa on Facebook | Clean Plate Charlie on Twitter | Melissa McCart on Twitter | E-mail Melissa |


My Voice Nation Help
3 comments
Interim_Satan
Interim_Satan

Hello, really? You're closer to market saturation at 30,000 stores nationally than you are at 800. McDonalds doesn't have that many places to grow *to*.

Beyond obvious. What a waste.

adam_hartung
adam_hartung

Thanks for touting the link to VC Circle article and mention

Melissa
Melissa

And yet for the foreseeable future, says Hartung, the chain struggles to find areas for growth (partly because the company has already saturated the market.)

yep. you repeated a point made.

Now Trending

From the Vault

 

Loading...