BUSINESS SPOTLIGHT: Up, Down, and Up Again – Chipotle’s Wild Ride

By  //  August 17, 2018

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Chipotle stock has nearly doubled in value since their low in February

After a three-year absence from the media spotlight, Chipotle is making headlines for rebuilding a franchise empire. The burrito chain came under fire in 2015 for sickening customers with E. coli and norovirus.

After a three-year absence from the media spotlight, Chipotle is making headlines for rebuilding a franchise empire. The burrito chain came under fire in 2015 for sickening customers with E. coli and norovirus. 

The year 2015 was a disastrous one for Chipotle stockholders. Multiple foodborne illness outbreaks and a full CDC investigation disintegrated public opinion and caused stock to plummet by 65%, or over $8 billion in valuation, over the course of the next year.

In a bid to reconcile with Chipotle diners, founder Steve Ells issued an apology published in dozens of newspapers. Despite this plea for the public’s patience, it seemed the company would never recover- at least, not until recently.

Today, Chipotle stock has nearly doubled in value since their low in February. According to economists and stock speculators, the reasons for this almost 94% upswing are varied: a new CEO, smarter spending, and multiple store openings. But, ultimately, it comes down to one innovation: better supply chain oversight with tools like mobile audit software.

Restaurant chains like Chipotle are increasingly turning to technology as an answer to food safety concerns. From analytics that trace the origin of specific ingredients to digital supplier audits that guarantee safe handling, much of the restaurant industry looks to rely on mobile devices soon.

Though foodborne illness outbreaks continue to plague major players in the quick service restaurant arena, Chipotle has demonstrated a strong commitment to quick, confident correction when issues arise. Recently, when an Ohio location was implicated in multiple reports of food poisoning, Chipotle temporarily shuttered the store to assess the operation.

Using an extensive system of supplier and internal inspections, Chipotle ensures that rigorous safety protocols are implemented long before produce ever arrives at one of their customer-facing locations. Even on-site employee training and behavior benefits from mobile technology; managers and inspectors can access cloud-based information to reference company standards and make on-the-spot corrections instantly.

That kind of rapid, reactive remediation is what brought Chipotle back from the brink and will likely put them back on the map for future investors.

While they may continue to struggle under the weight of foodborne illness reports due to the huge high of visitors, Chipotle has yet to see whether the most recent bout of bad press will put them back on the chopping block.

If mobile auditing and inspection software are at the core of their process, we probably won’t hear about another outbreak for some time.

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