Financial News

Chipotle brings back bigger portions after criticism from customers

Customers accused fast-casual chain Chipotle Mexican Grill of skimping out on the portion sizes of some of its most popular dishes, like burrito bowls.

Chipotle said that it has been consistently offering "generous portions" in an effort to satisfy the customers who complained on social media that they were getting skimped on the size of their servings. 

Interim CEO Scott Boatwright told analysts on Tuesday that proof is on the company's social media platforms, where he said people are "posting big burritos, big bowls and really excited about portioning they're getting in the Chipotle brand." 

Boatwright said that it's a "reverse of what we saw earlier in the year" when many TikTok users began sharing videos of workers assembling their Chipotle bowls, persistently requesting additional toppings. 

"We know we're delivering value for the consumer, especially in this really tight environment, and we'll continue to lean into that," he said.

CHIPOTLE CEO ADDRESSES BURRITO BOWL PORTION SIZES AFTER BACKLASH

CFO Adam Rymer also told analysts on Tuesday that the company had a higher usage of ingredients in the prior quarter due to its focus on "ensuring consistent and generous portions." However, the company also faced higher costs for several items, most notably avocados and dairy, according to Rymer. 

Still, Wall Street saw it as a smart play, with many firms raising their price targets on the stock.

CFRA Research Senior Vice President Arun Sundaram said that the company "essentially had no choice [but] to increase portion sizes given the backlash it received throughout social media." 

Sundaram continued saying that the bigger portion sizes should drive incremental traffic to stores, alongside initiatives like new limited-time offerings. 

Former CEO Brian Niccol began to address the issue in July, shortly after customers first aired frustrations on social media, saying "there was never a directive to provide less to our customers." 

He added that generous portions had always been a core brand equity of the fast-casual restaurant chain. 

Amid the criticism, Wells Fargo analyst Zachary Fedam started recording data from different Chipotle orders. Fedam, alongside other finance professionals, ordered and weighed 75 like-for-like burrito bowls across eight locations in New York City. They also tested the difference between online and in-store orders.

WELLS FARGO ANALYSTS 'WEIGH IN' ON CHIPOTLE PORTION SIZING AFTER RESTAURANT CHAIN FACES BACKLASH ONLINE

Based on the data, the smallest bowl ordered weighed 13.8 ounces, and the largest weighed 26.8 ounces.

"That said, consistency varied widely, w/ some locations serving bowls that weigh ~33% more than other locations (on equivalent orders); and the heaviest digital/in-store bowls weighing 87%/47% more vs the lightest," the report said. 

GET FOX BUSINESS ON THE GO BY CLICKING HERE

FOX Business' Sydney Borchers contributed to this report.

Data & News supplied by www.cloudquote.io
Stock quotes supplied by Barchart
Quotes delayed at least 20 minutes.
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.

Use the myMotherLode.com Keyword Search to go straight to a specific page

Popular Pages

  • Local News
  • US News
  • Weather
  • State News
  • Events
  • Traffic
  • Sports
  • Dining Guide
  • Real Estate
  • Classifieds
  • Financial News
  • Fire Info
Feedback