Chipotle's Critical Support Factors

One of the main critical support factors is production efficiency; with the food industry especially you must focus on high volume and low margins. According to Financial Times [1], input costs have been rising since 2012 for manufacturers. This means it is essential to minimize waste and find optimal product processes. With a product like Tasty Paste, we compared it to condiments on food. Condiments in restaurants such as ketchup, hot sauce, mustard, etc. all have extremely high volumes but low margins. We want our tasty paste to have the same type of business idea as far as making money. Obviously those condiments listed may be way more commonly used than our paste, which is used specifically for wraps and burritos, but we believe we

It is one thing to be able to sell our product on Amazon or online, but it’s another to get it into stores. If we want our product, a condiment, to be as successful as it can be, it needs to have widespread use. As we said, we need to have low margins and high volume in order to be successful. It is very difficult to sell high volumes using only online sales to individuals. For us specifically it is critical to get into restaurants like Moe’s, Chipotle, Taco Bell, Qdoba, and On the Border to name a few. Getting our product into these restaurants as well as grocery stores and stores like Costco, Target and Wal-Mart will allow us to not only utilize sales to individual consumers but also have our product used in high quantities with every wrap or burrito purchased from these chains. Without getting our product into these stores, we will end up like some of the low level competitors we have researched like Burrito glue and Burrito Tape. Hundreds of thousands of food products and condiments are created each

Manufacturing is an issue because with outsourcing, we do not have full control over the processes in which they bottle and mix the ingredients, as well as how much will go to waste and be lost. We do however; have control over the manufacturer we choose to outsource to. As I will speak on later we have chosen Kraft as our top choice as our main manufacturer, Kraft in their business model states “In our factories, our sustainability process drives decreased energy consumption by installing new technologies and more efficient equipment while optimizing business and manufacturing processes.” It is these types of practices that lead us to believe Kraft deserves their rating as one of the United States top 5 manufacturers. Although we do not plan to directly manufacture, we believe the Kraft will do a great job helping us to be efficient and optimize our products efficiency and quality. As of now it is difficult to calculate our what a competitive pricing stand point would be without costs of manufacturing as well as fixed costs of the company, however it is something we are currently working on calculating and developing for our final business model. Margins in grocery stores are as low as 1 percent, so in order to remain competitive store wide we must remain in that ballpark. Wholesale margins are a little bit higher, so