Apparently, when Chipotle says they source ethically, they mean business. In January, following an internal audit that revealed a large supplier of the chain's pork was not living up to its standards for raising hogs, Chipotle pulled the plug on its "carnitas" offering at more than 1,700 locations.
According to Chipotle's internal policies, pork suppliers, "must raise pigs with access to the outdoors or in deeply bedded barns to improve their comfort. The standards also prohibit the use of antibiotics," reported Kimberlie Clyma, for Meat + Poultry, but apparently, one of those suppliers demonstrated "inconsistencies in the chain’s animal welfare protocol."
Chipotle has said it will not resume the sale of pork at the affected locations until an alternate supplier can be identified, or the original supplier comes into strict compliance. But how have consumers reacted to the restaurant's decision? Has there been backlash against the move, or have customers lauded it for sticking to its principles?
How big is the projected impact on Chipotle's sales?
Truth be told, not very large at all. Carnitas account for somewhere between 6 and 7 percent of the chain's total sales— chicken is by far the most popular meat item— and only a third of Chipotle's outlets are affected.
But what would the company have done had a chicken supplier been found to be in non-compliance with its animal husbandry standards? What if the outage had affected more stores? Would it have been willing to take that kind of financial hit? It's an interesting question and one that has been subject to debate. At least in this action, though, Chipotle has put its money where your mouth is, and that bodes well for its brand narrative.
Was there really a choice?
Sustainable food and ethically-sourced food have become critical components of American food culture. After years of viral PR nightmares about "pink slime," strange additives, unhealthy preservatives and poor conditions in industrial farms and meat packing plants, the public has demanded— and gotten— a shift toward better ingredients and healthier alternatives. Chipotle and other fast-and-fresh restaurant concepts have been leaders of the movement.
Had the chain quietly kept selling carnitas from the offending supplier, sooner or later, word would have leaked out. For an operation that bases much of its business model and marketing on its adherence to strict, self-imposed ingredient standards, any willful violation of those standards would have been tantamount to corporate suicide. Chipotle had no option but to get ahead of the news and stop purchasing from the supplier in question.
Instead, Chipotle comes out looking like the hero. It showed that it takes its own standards seriously. It showed that it is proactive in enforcement of those standards. And it indicated to it customers that it cares more about living up to its stated social contract than it does about profits. That's something, noted Yahoo! Financial's Chris Nichols, that most fast food companies have historically failed to do.
In the past, when ingredients have come under fire, companies like McDonald's and Taco Bell have been quick to defend their food safety, and not to address the public's perception of food quality. That's where Chipotle gets things so right— it's not enough that their food is safe. Chipotle wants it to be desirable, too.
And where McDonald's sales keep falling, Chipotle's keep rising. According to Clyma, their same-store sales were up almost 20 percent in the third quarter last year alone.
When food companies don't live up to their own standards, customers can't trust them to serve safe food.
It is imperative, for the health of your brand, to make sure that you are maintaining strict control over your supply line and over your in-outlet quality control. This is particularly hard for franchised operations, but Chipotle, Marriott and other companies that demonstrate such control have shown that it can be done and done well.
The movement toward sustainable food and ethical sourcing doesn't seem to be slowing down any time soon. And now that Millennials make up the largest portion of the American population, you should expect that demand to grow. Food culture in the United States is growing up; your food company needs to grow with it.