The majority are higher-end guests, a group that actually increased frequency and likely isn’t trading down. Throughout the quarter, Chipotle saw lower-income consumers pull back their frequency, but Niccol emphasized this isn’t the chain’s primary customer. So I think in some cases, folks think they’re moving pretty quick when in fact we could be moving a lot faster.” “… A lot of these folks haven’t experienced how fast the line can move. “We’re confident that if we can get our team members to understand what it means to be, call it, rush-ready in their places and ready to go, there’s no reason why we can’t get back to those high 20s, low 30s on a per 15-minute basis,” Niccol said. Niccol said some stores-with teams that have been together for years-are earning $5 million to $7 million, proving restaurants have “tremendous upside” when efficiency is at its best. The brand laid out this goal in 2019 and it began to pay dividends in early 2020 before COVID hit. With the future in mind, Chipotle previously announced its experimentation with Chippy, a robot that cooks tortilla chips, and invested in Hyphen, a foodservice platform that created an automated makeline.įor the in-restaurant frontline, Chipotle wants to reach 2013/2014 levels, back when restaurants were fulfilling orders in the high 20s to low 30s on a per 15-minute basis. And those are just the near-term solutions. But the capabilities are much higher than what our previous tool allowed.”Ĭhipotle also installed customer-facing PIN pads to promote faster and contactless payment options, deployed a new learning management system to provide e-learning courses, updated its POS hardware, and made computer programming enhancements to improve accuracy and throughput. When you first get in the car, it’s a very, very highly sophisticated tool.
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It’s like learning how to drive a Ferrari. “Our ability to really put exactly the right people with the right skills at the right time throughout the day to drive throughput has never been better,” CFO John Hartung said. To increase throughput among greener staff members, Chipotle launched an ops initiative to retrain workers on the fundamentals of business and implemented a new labor management tool to ensure the right number of employees are scheduled during certain parts of the day. Through mid-May, comps were projected to reach the high end of previous guidance (10-12 percent), but numbers decelerated toward the back end of the quarter, which Chipotle attributed to a combination of macro pressures, normal seasonality of college-based stores, and handling growth with a relatively new workforce. In Q2, systemwide sales lifted 17 percent year-over-year to $2.2 billion, and same-store sales grew 10.1 percent. READ MORE: Chipotle is Headed to a Small Town Near You A lot of these managers have gotten promoted over the last 18 months to 24 months.” And we just have a lot of new people that don’t understand how important some of those roles are as well as general managers, too. You can’t work around those things to try and service the business. “And I feel like this is rinse and repeat, but that’s what our business is a little bit, which is we got to have our aces in places, as you know, you got to have the expeditor. “We’ve got a lot of new people that are still getting trained up on, frankly, the basics of great throughput,” Niccol said during Chipotle’s Q2 earnings call. Now, the challenge is bringing these newer employees and managers up to speed on how to effectively grow a multi-million-dollar digital and in-restaurant business. The executive’s optimism comes from the fact staffing remains above 2019 marks and restaurants aren’t experiencing capacity constraints on their front or digital makeline. CEO Brian Niccol is confident about surpassing $3 million and is also quite sure the brand will talk about eclipsing $4 million at some point. In the coming months, labor stabilized and sales recovered.Ī year later, Chipotle finds itself running an AUV of $2.8 million, with 39 percent being digital. The country’s largest fast casual sought to resolve it by increasing average wage to $15 per hour and signaling to existing teams that pay raises were coming their way, as well. During 2021’s second quarter, Chipotle had a staffing problem.
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