Tweet

All About the Chipotle Franchise

Guest post by: Global BX

Article Overview: Chipotle's signature menu, the giant foil-wrapped burrito may not be that big but it surely is big enough to drive a massive success on its marketing campaigns and make the restaurant chain one of the most popular fast food franchises in the country today, and probably for the next decade. The Chipotle franchise founder, Steve Ells, was a culinary school graduate who dreamed of opening his very own fine dining restaurant. When Ells realized that he lacked enough funding for his goals, he established the Chipotle Mexican Grill in 1993, with high hopes that the money generated from this venture...

All About the Chipotle Franchise

The Famed Giant Foil-wrapped Burrito

Chipotle's signature menu, the giant foil-wrapped burrito may not be that big but it surely is big enough to drive a massive success on its marketing campaigns and make the restaurant chain one of the most popular fast food franchises in the country today, and probably for the next decade. The Chipotle franchise founder, Steve Ells, was a culinary school graduate who dreamed of opening his very own fine dining restaurant. When Ells realized that he lacked enough funding for his goals, he established the Chipotle Mexican Grill in 1993, with high hopes that the money generated from this venture will help him open his ideal restaurant. The very first Chipotle location was in Denver. Surprisingly, many customers patronized its services and products, attracting the attention of aspiring entrepreneurs and investors. Years after the establishment of Chipotle, Ells has still not yet opened his dream fine dining restaurant. Though it's not a bad thing, considering that he currently sits at the top of a highly reputed and successful fast food service venture.

Chipotle Franchise Review

As of today, Chipotle avoids operating a typical franchise system. Because of this, there are presently no Chipotle franchises, no Chipotle franchises for sale, and no way for any interested entrepreneur to buy a Chipotle franchise - at least for now. In 1998, the McDonald's Corporation invested a large amount of money in the company, claiming an ownership right in Chipotle until the latter went through IPO (initial public offering) in 2006. Still, Chipotle continues to be a reputed fast food enterprise primarily because of its superior customer service and high quality ingredients used in its products. The company's lack of solid franchise model came out a surprise to many, since McDonald's had a huge influence on Chipotle's corporate operations during the eight years of financial involvement and assistance, not to mention the former's role in Chipotle's rapid expansion to over 547 stores in 26 US states. Ells stayed in the company throughout the transition from private management to a restaurant supported by a public corporation. Ells has not dismissed the idea of selling Chipotle franchises in the near future to interested fast food franchisees, but for now, he still maintains the operations as they are. This gives him more control over the company's processes and also offers existing employees opportunities to climb up the corporate ladder as store supervisors and managers when new Chipotle fast food franchises open. The company strongly values and believes in the "promote from within" culture.

Additional Chipotle Franchise Information and Costs

Buying fast food franchises can cost a lot of money. Most parent companies ask for an initial franchise fee that can go as high as $25,000 and even higher. Ongoing royalty fees required from all franchisors, range from four to eight percent of the net profits. Companies raise capital in franchising, wherein they allow entrepreneurs to manage their own businesses with less supervision. In the case of Chipotle, it has enough cash to spend on continuous expansion without having the need to offer a Chipotle franchise to outside investors. The management's long-term expectations include a constant financial growth of 25 percent annually, should Chipotle open more than a hundred fast food locations within the next five years. Financial sources are easily available since Chipotle is a public corporation. The market capitalization of Chipotle is over $1.8 billion, and it has yearly revenue of more than $775 million. Its net income is around $34 million every year, with a five percent profit margin, which is the average in the fast food field. Chipotle also has a remarkably small debt, which indicates how promising the company is in terms of profitability.

Prospective Entrepreneurs Eager to Buy a Chipotle Franchise

Many franchising professionals agree that the chance to buy a Chipotle franchise is on top of numerous fast food franchisees' must-buy list. When the company decides to offer Chipotle franchise for sale, many will surely grab their chance of a lifetime.

Related Articles
  Franchising with all its Success
  About 60% of all franchise opportunities have less than 50 units.
  Why Use a Franchise Consultant?
  Did you know: NIIT Franchise was present in Malaysia in 1997?
  Master Franchises Explained
  "Untouchables" and "Discussables"
  Reselling Your Franchise
  Buying a franchise during recession
  The best franchise systems all have effective leadership.
  Hiring a Franchise Lawyer
  Question Your Franchise Decision Making
  Why Franchises are Good Investments
  Finding a Franchise Online
  Low Cost Franchises Offer Way to Own Your Own Business
  Franchise Solutions Named a Top 5 Portal for Overall Performance and Lead Quality by Franchise Benchmark
  Why Franchisees Should Consider Using a Franchise Broker
  Franchise information that is pertinent to your investigation is disclosed in the Uniform Franchise Offering Circular (UFOC).
  Steps to a Successful Franchise Experience
  Singapore Food Franchise Snackz It Expands to three Locations
  Do You Need Experience to Own a Franchise?

Article Tags: chipotle, chipotle costs, chipotle franchise, chipotle franchise cost, chipotle franchises, franchises



Related Forum Posts
Re: Enticing Franchises - Top 9 List - All Franchise listed above are in millions of dollars. Do you have the list of Franchise in thousands
Re: Info for would be franchisers... - [quote="Sebastien":1d29sdv1]Like Franchise Times, Franchise Update is a very practical magazine. There is no blah blah, just straight facts that anyone in the franchise community can relate to. I just want to mention that all these magazines are NOT franchisee oriented. I mean these magazines are for franchise professionals. If you're looking to buy a franchise, you won't find much information in there. To answer your question, getting published in Franchise Times was fairly easy. I don't want to brag too much but I think I am known in the franchise industry. I was the marketing guy at Franchise.com for a few years before joining my new company, the World Franchising Network. So people know me and I have a very good relationship with Nancy Weingartner, the Managing Editor at Franchise Times. I was talking with her at the last Franchise Expo South in Miami and she mentioned she'd like me to be profiled. I was like "ok, sure!". I like this franchise executive profile thing in Franchise Times as it is rarely BS. People are usually really natural in there.[/quote:1d29sdv1] Thanks for the follow up Sebastien! And I can't say that I'm surprised that networking with the right people and managing your relationships with them properly are the keys to being published. I guess the old adage holds true of "it's not who you know, but who knows you" that's important.
how much for a franchise fee? - Dear Colleague There is no easy answer to this question. Things to consider: [list=] The sizeof the Franchise Clent base Expected Turnover Intellectual Property costs (recoup) Number of Franchises Number of employees Original Set up costs Franchise admin costs An example: A franchise that I was involved in setting was to a simple "lawn mowing/home repair" franchise. The Franchise included national/local advertising - preparation of client lists - general admin - central accounting etc The Franchise involved 300-500 clients - and an annual turnover of about $300,000 . The annual franchise fee was $30,000. Hope that this gives you some idea Take care Ian[/list]
Re: Franchise Surveys - Another good tool to researching a franchise is to speak with their existing franchisees. This contact information is included in most Franchise Disclosure Documents. In order to get a Franchise Disclosure Document or FDD as it is often referred to, you will have to complete a basic franchise application. The franchisor will then usually provide you with the FDD at that time. Included in that book of information is a list of the existing franchisees, the contract, the investment information etc... This information is required by Federal Law to be disclosed to your prior to making a purchase. So be sure to do your research and start with the Franchise Documents to get the initial information.
Re: Info for would be franchisers... - [quote="Sebastien":2gam0klq][quote="BuzzAroundBooks":2gam0klq]Like Franchise Times, Franchise Update is a very practical magazine. There is no blah blah, just straight facts that anyone in the franchise community can relate to.[/quote:2gam0klq][/quote:2gam0klq] That is really what I look for in any industry publication. We lead busy lives and when people fill their magazines with fluff, not only does it benefit no one, but it makes us truly appreciate those that don't. Thanks!


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Quick Tips on Buying a Business

Designing Employee-Enhancing Training Programs

Link Pyramids

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.