Speaker 1: Bloomberg Audio Studios, podcasts, radio news. So breaking news we've
Speaker 1: learned at Chipotle, the text mes chain that is primarily
Speaker 1: based here in the United States, is set to open
Speaker 1: its first location in Mexico later this week. It's a
Speaker 1: substantial expansion that will eventually extend to Mexico City in
Speaker 1: twenty twenty seven, and it's part of a broader international expansion.
Speaker 1: Our relatively new CEO, Scott Boatwright. We had a chance
Speaker 1: to sit down with Scott just a few minutes ago.
Speaker 1: Here's what he had to say about the opening.
Speaker 2: We believe, you know, Mexico is a really important milestone
Speaker 2: for our great brand as we continue to lean into
Speaker 2: our global strategy.
Speaker 3: It's an important country for us.
Speaker 2: We recognize and admire the culinary heritage that is a
Speaker 2: part of the Mexican culture, and we respect what we
Speaker 2: believe to be some of the best food.
Speaker 3: In the world.
Speaker 2: What we're working to do is really tackle this emerging
Speaker 2: trend that we see around the globe. We also see
Speaker 2: it down in Mexico, this idea around fresh ingredients being
Speaker 2: prepared same day, freshly in restaurants, and we believe what
Speaker 2: we do and what we offer will really resonate with
Speaker 2: the Mexican community.
Speaker 1: I know you've had to have done a lot of
Speaker 1: market research, and there's been a lot of talk about
Speaker 1: this idea of just how prolific not just Mexican takoias are,
Speaker 1: but obviously all of the sort of unauthorized stands. Anyone
Speaker 1: who's walked around Mexico City, Monoray, these big cities, they
Speaker 1: are everywhere.
Speaker 3: And I saw one.
Speaker 1: Stat that said that basically, if you live in an
Speaker 1: urban area in Mexico, you don't have to go more
Speaker 1: than two or three hundred feet before you find a
Speaker 1: taco cart of some kind or another. Have you factored
Speaker 1: that into your equation, that you're not just competing against
Speaker 1: established chains, but basically that ma or pa so to speak,
Speaker 1: on the street selling food from their carts.
Speaker 2: Yeah, it's a great question, and we have and so
Speaker 2: we have partnered with what we believe to be a
Speaker 2: world class partner, and I'll say in Mexico, who has
Speaker 2: brought other US brands into the country at a very
Speaker 2: successful pace of growth with brands like Starbucks and Cheesecake Factory,
Speaker 2: and they've.
Speaker 3: Done an incredible job.
Speaker 2: So we believe the right partnership, strength of the partnership
Speaker 2: and the opportunity to go into Monterey first and showcase
Speaker 2: the brand in a really unique way down in San
Speaker 2: Pedro is really step one. As we continue to move
Speaker 2: through Monterey and open up and expand, we'll have our
Speaker 2: site set on Mexico City next. But we believe what
Speaker 2: we offer, the idea of the best ingredients in the world,
Speaker 2: prepared fresh in restaurant daily at an abundance and variety
Speaker 2: and speed really which is unmatched at a really competitive
Speaker 2: price point, will resonate well with the consumers in the market.
Speaker 4: Well, Scott, as you mentioned you you're starting in Monterey,
Speaker 4: you have plans to expand into Mexico City a little
Speaker 4: bit later. In terms of timeline here, talk to us
Speaker 4: about that cadence. Why you chose to start in Monterey,
Speaker 4: What sort of boxes that region checked for you.
Speaker 2: Yeah, if you haven't been to Monterey's it's a really
Speaker 2: beautiful city, really.
Speaker 3: Progressive city in Mexico.
Speaker 2: We love the trade area, we love the consumer profile
Speaker 2: in that market. Specifically, we plan to expand at a
Speaker 2: very measured pace to show that the brand can work
Speaker 2: and really any geography around the world.
Speaker 3: We think Monterey is a great starting point.
Speaker 2: For us, We'll launch the brand there, moved to a
Speaker 2: number of restaurants, and then moved to Mexico City, where
Speaker 2: we think we can be hyper successful in a really
Speaker 2: large metro city that is probably one of the largest cities.
Speaker 3: In the world.
Speaker 4: Well as really and sort of hinted out, there's a
Speaker 4: little bit of irony when it comes to the fact
Speaker 4: that Chipotle Mexican Girl is opening up expanding into Mexico.
Speaker 4: And with that in mind, what changes do you have
Speaker 4: planned for Mexico when you think about pricing your menus,
Speaker 4: potentially your ingredients, what are you adapting to Mexico? What
Speaker 4: are you keeping the same?
Speaker 2: Yeah, so we to use the same menu we have
Speaker 2: here in the United States in Mexico, will locally source
Speaker 2: as much of the product we bring over the border today,
Speaker 2: as it relates to avocados and tomatoes and peppers, will
Speaker 2: locally source those. But it'll be the same menu we've
Speaker 2: launched in Western Europe, the same menu we launched in
Speaker 2: the Middle East with our partner Alshia.
Speaker 3: We have fifteen restaurants open.
Speaker 2: In that region today and the brand really resonates well
Speaker 2: when we deliver on standard, the same execution and same
Speaker 2: menu that we have in the United States.
Speaker 1: With regards to your partnership with ALSEA, I mean, this
Speaker 1: is a licensed model, and I am curious that given
Speaker 1: that you pretty much own your stores here in the
Speaker 1: United States, how do you sort of ensure that you know,
Speaker 1: quality control both on the ingredient side, but also in
Speaker 1: terms of service is going to be up to the
Speaker 1: same standard that anyone would expect at any other location.
Speaker 2: Yeah, I think it's really about when you go into
Speaker 2: a new market, is really assessing the partner quality. Believe
Speaker 2: in this idea of a slow measured approach to global expansion.
Speaker 2: We're not opening restaurants at a fast paced just for
Speaker 2: the sake of opening restaurants. We're going to protect the
Speaker 2: quality of our great brand through the strength of the partnership,
Speaker 2: management of the supply chain, and then oversight on how
Speaker 2: we deliver the experience each day to each community in
Speaker 2: which we serve, where that's in the Middle East, Latin America,
Speaker 2: and or Southeast Asia, which will open up later this year.
Speaker 1: Well, I'm curius, how far do you want to take
Speaker 1: this international expansion. Obviously, you're a relatively mature company thirty
Speaker 1: plus years old, primarily here in the US. You have
Speaker 1: the partnership in the Middle East, you reference a partnership,
Speaker 1: and I believe in South Korea and now in Mexico
Speaker 1: Latin America. Is this the longer term growth story for
Speaker 1: Chipotle under Scott boat right, it is as.
Speaker 2: We continue to expand in North America. We have a
Speaker 2: really strong business model here. We have an incredible team
Speaker 2: that is opening up restaurants at a record pace. We'll
Speaker 2: open up in North America alone this year north of
Speaker 2: three hundred and fifty restaurants. So we feel like we
Speaker 2: have a really good foothold here and we understand how
Speaker 2: we deliver the model and how we deliver on consumer
Speaker 2: expectations and preferences in a really meaningful and unique way.
Speaker 2: What we endeavor to do now is we build Chipotle
Speaker 2: to a global iconic brand. Is really showcase that the
Speaker 2: brand works in every region of the world. At the
Speaker 2: heart of the menu, it's really rice beans, heavy protein,
Speaker 2: and heavy vege prepared fresh, which we know is not
Speaker 2: unique around the globe.
Speaker 3: And we're going to.
Speaker 2: Showcase in a very slow and measured way that we
Speaker 2: can be successful in every region of the world.
Speaker 4: Well, Scott, you mentioned heavy veg and I want to
Speaker 4: apologize for this next question since we are talking about food,
Speaker 4: but we have to talk a little bit about cyclospory assis.
Speaker 4: I hope I'm saying that right. It's that parasite that's
Speaker 4: been linked to severe diarrhea. We've seen outbreaks in more
Speaker 4: than thirty US states and they're usually linked to basil,
Speaker 4: cilantro lettuce, things that I'm sure you use a lot
Speaker 4: at Chipotle. So what have you seen? What do you
Speaker 4: know about this? Have you seen any notices from your
Speaker 4: suppliers or anything along those lines.
Speaker 2: Well, first and foremost, the care and safety of our
Speaker 2: team members and our guests is always our highest priority.
Speaker 3: We have gone through our supply.
Speaker 2: Chain ingredients with our partners to understand if any of
Speaker 2: our ingredients have been indicated in the cyclospora outbreak, and.
Speaker 3: They haven't to date.
Speaker 2: We don't expect that they will, but we'll continue to
Speaker 2: monitor our supply chain and be hypervigilant to ensure we
Speaker 2: are protecting both our team members and our guests in
Speaker 2: our fullest way and
Speaker 4: Our thanks again to Chipotle CEO Scott boat Right talking
Speaker 4: about the chain's expansion into Mexico.