Can Chipotle Afford to Alter Its Responsible Meat Pledge?
Patrons of Chipotle restaurants know that when they order a dish made with beef, chicken or pork, the meat will come from animals that have never been given antibiotics or added hormones. The reality of the situation, however, is that demand for responsibly raised poultry and livestock is on the rise and there is only so much of it to go around. It’s this very situation that has resulted in a mini maelstrom for Chipotle when its spokesperson said the chain was considering using cattle that had been treated with antibiotics due to illness. The chain’s current policy requires any cattle given antibiotics be removed from its supply.
"We are always looking to improve our protocols in order to ensure that we are buying the very best sustainably raised ingredients," said Steve Ells, Chipotle founder, chairman and co-CEO, in a statement. "Many experts, including some of our ranchers, believe that animals should be allowed to be treated if they are ill and remain in the herd. We are certainly willing to consider this change, but we are continuing to evaluate what’s best for our customers, our suppliers and the animals."
Keeve Nachman, a professor of Environmental Health Sciences at Johns Hopkins University, told USA Today, that the use of antibiotics in food production is "rampant," but limiting it to treating sick animals under the care of veterinarians makes "good sense."
Chipotle said that it occasionally is affected by shortages of responsibly raised beef, chicken and pork. The shortages typically only last a few weeks and affect a small percentage of its locations. When shortages occur, the company posts notices so consumers are aware of what is going on.
Discussion Questions
Can Chipotle afford to alter its responsibly raised beef, chicken and pork policies? What do you think is the likely outcome if it leaves livestock treated with antibiotics for illness in its supply chain?
I think this is a complete non-issue. Although this not organic meat, the organic segment of the food industry is the fastest growing, despite its critics, because there is a strong demand.
Customers dictate the market and, in this case, Chipotle is the customer. If they commit to buying from sources that produce the kind of meat they want, producers will deliver. If all they want to do is buy meats at commodity pricing, inevitably there will be shortages. It’s a matter of what customers they want to attract, how they want to position themselves in the QSR market, and what their commitment is to maintaining that position.
Chipotle’s main promise is the food tastes great. An ancillary benefit is their sourcing of the meat. As long as they continue their dialogue with their customers, I agree with Ken—it is a non-issue. Millennials don’t demand absolutes but they do want transparency.
It is unfortunate we are having a discussion about providing people with food that does not contain hormones. In this case, Chipotle should be as strict as possible when introducing anything that goes against their charter into the supply chain.
I think consumers understand and respect the pledge to supply hormone-free meat, so if there are occasional shortages it’s not to the detriment of the brand. Introducing hormones, however, could lead people to wonder what else might be included and how you differentiate between sick animals’ hormones versus other hormones. This is a slippery slope. If you ask people are they bothered by stock outs, they’ll probably say yes, but if you asked them if they want hormones in their food, I doubt they’d want that as an alternative.
Chipotle has its pricing structure set up to compensate for “responsibly raised protein.” If other products are cheaper, then why not offer them at a proportional discount in a test market and see what happens? There is a chance that most consumers won’t care and will opt for the cheaper product. Start with just one protein and expand from there if consumers migrate. Keep penny profit per item the same so any revenue loss will not lower profits.
I’m not sure I agree with the premise that “there’s only so much of it to go around.” I think it’s more along the lines of “we end up rejecting a lot of perfectly good—well, ALMOST perfectly good—supply through applying a letter-of-the-law rather than spirit-of-the-law approach.” It’s another way of saying that while people are willing to pay more for a product that’s (generally) better—or at least they perceive it as better—they’re not willing to pay for it to be perfect. “Good sense” indeed, and if that sets them on a slippery slope, then they’ll just have to step carefully.
What Chipotle is doing is totally consistent with their brand promise of “Food with integrity.” Chipotle is “walking their talk.”
Most people won’t care or notice, as they are just after inexpensive, tasty food. But, those that do care are likely to raise quite a bit of a fuss on social media.