Fast-casual burrito leader Chipotle is still struggling to regain its footing after E. coli and norovirus outbreaks last year sickened hundreds of customers.
The company announced during an investment conference this week that same-store sales were down 26.1 percent in February after declines of 30 percent and 36 percent in December and January, respectively. Chipotle executives also said they expected their first quarterly loss since going public in 2006.
In February, Chipotle rolled out a number of operational changes to ensure its food was safe, which included preparing certain foods off site, DNA-testing meat and fresh produce, establishing a new food-tracing program, and offering employees paid sick leave.
In addition, the company debuted a bonus initiative that incentivizes store managers to uphold food-safety standards. On February 8, the day the company closed stores for four hours to host a chain-wide meeting, CEO Steve Ells revealed the Chipotle Local Grower Support Initiative, a program that supports local food producers and helps ensure they also meet food-safety standards. Chipotle pledged $10 million to the initiative.
Now, according to recent reports, the burrito chain is tweaking some of its food-safety changes. The Wall Street Journal reported that Chipotle was scaling back some of its changes like DNA testing, while ABC News found that the company would start using the sous vide technique to cook its steak in a central kitchen, then marinate and sear the product in stores.
Multiple reports also stated that Chipotle had hired Kansas State University professor and food-safety expert James Marsden to oversee its food-safety program.
Meanwhile, the company’s efforts to regain customers have extended into its marketing. Chipotle issued free burritos in February to any customer who texted a code to a designated phone number, and executives announced that 5.3 million people texted the number. Some 67 percent of them redeemed the coupon.
Chipotle is doubling down on its free-burrito strategy, announcing that it would mail 21 million coupons to households across the U.S.
By Sam Oches