This has been a rough year so far for Chipotle, and it’s only April. First there was #CarnitasGate, which still isn’t over. Then Twitter user @fuckboybobby unleashed an epic rant about the chain’s alleged “meat finessing” (which apparently means “skimping on and/or stealing back meat Chipotle burrito builders already gave you”).
And now, like clockwork, Chipotle has announced that it’s raising prices later in 2015. This time last year, executives said that 2014 prices would rise an estimated 3 to 5 percent, or 24 cents to 50 cents per $8 burrito bowl.
For 2015, Slate reports that steak and barbacoa prices are expected to rise by 4 to 6 percent by the end of the year.
This had analysts shaking their heads, because just a couple months back, in February, Chipotle said it expected prices to largely stay the same through 2015 when it was reporting on Q4 earnings. When asked why it had no plans to increase prices even though food prices were continuing to rise, Chipotle execs said they wanted to keep their brand “accessible and affordable.”
Now the company has reversed course, saying it “undershot” on its 2015 beef prices in particular. Since the astronomical rise in beef prices is hitting all the chains hard, it’s not like anyone can say they’re lying.
But Does A Price Hike Even Matter To Chipotle Fans?
If last year’s price hike is any way to judge, it doesn’t look like a 4 to 6 percent rise in steak and barbacoa prices will really hurt the chain. In another Slate piece written after the 2014 price hike happened, Morningstar senior restaurant analyst R.J. Hottovy identified three factors that work in Chipotle’s favor with price hikes as compared to other chains:
- The food quality is perceived to be higher
- Service is better
- Chipotle’s customer base skews more affluent than most other chains
Or, to summarize, we could just go back to this little kid’s devastating honesty about #ChipotleIsMyLife: