Why is Chipotle’s ‘Chipotlanes’ Expansion Facing a Major Setback?

, a renowned chain, is struggling with delays in expanding its mobile pick-up window concept, ‘Chipotlanes', across the United States.

Targets for Chipotlanes

The company's objective is to install 1,000 Chipotlanes by the end of 2024. Presently, they have deployed 811 Chipotlanes successfully and despite the slowdown, they aim to reach their goal by the set timeframe.

Reasons for Delay

Jack Hartung, CFO of Chipotle, attributed the delay to various macro pressures. He included high-interest rates and delays in securing permits, inspections, and utility installations as some of the main culprits. This has resulted in extending the project time from the initial 15-16 months to the now projected 21-22 months.

Chipotlanes and Their Efficiency

Despite the setbacks, Chipotle plans to expand its footprint to 7,000 restaurants in North America. In line with this, 80% of the new stores are set to feature a Chipotlane. These Chipotlanes offer convenience to customers who, on average, collect their food in less than 30 seconds.

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Preparing for ‘Burrito Season’

In preparation for the peak demand period, also known as ‘burrito season' (March to May), the company plans to hire an additional 19,000 workers. This will ensure the brand can cope with the increased demand during this time.

Budgeting for Increased Costs

Customers need to get ready for a considerable price increase as a result of a new Californian law. This law has increased the minimum wage for fast food workers to . McDonald's, another giant in the fast-food industry, also plans to react to this new law by raising its menu prices.

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