Chipotle shortages show lack of humanely raised livestock
Food standards have helped chain build its reputation
Chipotle Mexican Grill is still struggling to keep popular menu items from disappearing.
The fast-casual chain stopped selling carnitas burritos at hundreds of its restaurants in January because it dropped one of its pork vendors, and it’s still not fully stocked. The company also has run low on its premium supplies of beef and chicken over the past year, forcing it to offer alternatives at some locations. And social media is rife with posts from customers complaining that their local Chipotle is missing one item or another.
While Chipotle remains popular with consumers and investors, the company is a victim of its own growth and ingredient guidelines, which prevent it from using most of the nation’s fastfood suppliers. It’s also facing an increasingly crowded market for natural and humanely grown livestock. As chains ranging from Dunkin’ Donuts to Kroger adopt similar standards, there may be less to go around.
“We don’t know for sure when we’ll be fully supplied again,” Chris Arnold, a spokesman for Chipotle, said in an interview. “For many years, we’ve been operating in a system where the primary food supply doesn’t meet our standards.”
The company hasn’t stabilized its pork supply more than two months after removing the ingredient from about 600 U.S. restaurants, about a third of its locations. Signs have appeared in Chipotles across America warning that there are no carnitas. Before that, the Denverbased company warned it may have to stop selling guacamole or salsa because of ingredient costs.
Chipotle has built its reputation on a stringent set of food standards. The meat it serves is free of antibiotics and added hormones. When it comes to pork, the animals must have access to the outdoors or deeply bedded barns.
The trouble is, pigs raised that way account for a tiny fraction of what’s produced in Chipotle has farm-by-farm more pork.
At the same time, the company is looking to open as many as 205 restaurants this year, bringing its total to about 2,000. It may have to reconsider its expansion plans if it can’t find a long-term solution to the pork supply woes, said Asit Sharma, an analyst at the Motley Fool in Raleigh, N.C.
That concern may undercut a thesis embraced by Chipotle management and investors, who believe “growth will be supported by store expansion and customers’ seeming indifference to price increases,” Sharma said. “The company may be forced to slow its store growth if it can’t evolve new relationships with ‘sustainable’ suppliers quickly enough.”
Continued shortages increase the likelihood Chipotle will have to raise prices again. The company boosted prices 6.3 percent last year, citing supply constraints. Customers didn’t seem to mind. They continued ordering steak and barbacoa burritos, and comparable-store sales rose more than 16 percent in the fourth quarter. the U.S. So to go on a search for