Chipo­tle con­tin­ues shift with preser­va­tive purge

The firm’s U.S. stores now sell flour tor­tillas made with just five in­gre­di­ents.

The Denver Post - - BUSINESS - By Les­lie Pat­ton

Chipo­tle Mex­i­can Grill Inc.’s quest to sell preser­va­tive-free food is now com­plete, giv­ing the chain fresh brag­ging rights as it tries to re­build its rep­u­ta­tion and re­cover from a sales slump.

The com­pany’s U.S. stores are now sell­ing flour tor­tillas made with just five in­gre­di­ents — flour, wa­ter, canola oil, salt and yeast, Chipo­tle said Tuesday. The bur­rito wrap­pers used to have dough con­di­tion­ers and preser­va­tives. The move marks the lat­est push by the Den­ver-based chain to re­vamp its in­gre­di­ents and outdo ri­vals af­ter food-poi­son­ing in­ci­dents sent sales plung­ing and hurt its rep­u­ta­tion.

“The way to grow the business is not through limited-time of­fers, ex­tra value meals or menu pro­lif­er­a­tion with all kinds of new items,” chief ex­ec­u­tive of­fi­cer Steve Ells said in an in­ter­view. “For us, in­stead it’s about im­prov­ing the ba­sic, whole­some in­gre­di­ents.”

Restau­rants have been rush­ing to clean up their menus in a bid to at­tract younger and more health-con­scious din­ers. Pan­era Bread Co. has also been on a mis­sion to sell ad­di­tive-free foods, an­nounc­ing ba­con made with­out ni­trates and preser­va­tives last year. McDon­ald’s Corp. and Sub­way now sell chicken raised with­out an­tibi­otics.

Since the food­borne-ill­ness out­breaks at Chipo­tle in 2015, Pan­era has been out­shin­ing its ri­val among fast-ca­sual restau­rants. The bak­ery-cafe chain is ex­pand­ing de­liv­ery and saw same-store sales rise 0.7 per­cent in the most re­cent quar­ter. Chipo­tle’s, how­ever, con­tin­ued to slide with a 4.8 per­cent drop.

Chipo­tle’s menu purge has been un­der­way for years, but it lost the spotlight dur­ing the food-safety cri­sis. With the ef­fort com­plete, the com­pany now re­lies on 51 in­gre­di­ents, in­clud­ing some or­ganic pro­duce and meat raised with­out hor­mones. The com­pany has talked about sell­ing a new dessert item this spring, which may add an in­gre­di­ent or two, Ells said.

The changes have helped lift the stock. Chipo­tle rose as much as 1.7 per­cent to $421.99 in New York on Tuesday, and has gained 10 per­cent this year through Mon­day’s close.

The chain also says that none of its in­gre­di­ents are ge­net­i­cally mod­i­fied. The new tor­tillas, tested across the U.S. be­gin­ning in Jan­uary, are stored in Chipo­tle restau­rant cool­ers in­stead of at room tem­per­a­ture, Ells said. Its corn tor­tillas used for chips have two in­gre­di­ents — corn masa flour and wa­ter. “This is Chipo­tle’s story — through the years we’ve made all of our in­gre­di­ents bet­ter,” he said. “To­day’s bur­rito is bet­ter than yes­ter­day’s.”

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