Chipotle Raises Menu Prices by 2% Nationwide To Offset Inflation

After holding off for more than a year, Mexican-inspired fast-casual chain Chipotle has relented on maintaining its current menu pricing. As Restaurant Business reported, Chipotle will be raising prices by 2% nationwide in order to offset persistent inflation — inflation which is hampering its operating costs, in addition to other factors.

“For the first time in over a year, we have taken a modest price increase of approximately 2% nationally to offset inflation,” Laurie Schalow, the chain’s corporate affairs chief, said in a Dec. 4 statement, according to NBC News.

Chipotle Delivers on Previous Signal To Raise Menu Prices, Citing Inflation and Larger Portions

Per Restaurant Business, the news of Chipotle’s most recent price increase wasn’t a complete surprise.

During a Q3 earnings call in October, CFO Adam Rymer indicated that a price increase of between 2% and 3% could be in the cards for the company.

While inflation may have been one primary driver behind the chain’s price hike, it wasn’t alone. In July, NBC News indicated that Chipotle had faced public pressure to increase portion sizes after several videos went viral online, each criticizing the chain for meager portions.

In response, per a separate NBC News report, the chain focused on retraining staff at affected restaurants in order to ensure quality standards were maintained, and serving sizes increased. At the time, then-CEO Brian Niccol made it clear that Chipotle was taking steps to correct the issue.

“We are re-emphasizing training and coaching around ensuring we are consistently making bowls and burritos correctly. We have also leaned in and re-emphasized generous portions across all of our restaurants,” he explained at the time, noting that the generous portion size “is a core brand equity of Chipotle.”

Food Costs Also Forcing the Chain’s Price Increase

With demand slumping even though traffic remains strong, as NBC News reported, Truist analysts nonetheless stated that Chipotle’s price increases were coming from “a point of strength” in this regard. If investor sentiment means anything in this context, it appears to have the company’s backers unfazed: Chipotle stock ticked upward modestly as of 10:53 a.m. ET on Dec. 5 by 0.77% to rest at $64.38.

Food prices overall have been the basis for menu price increases across the restaurant industry, Chipotle included. The company cited a new premium brisket offering — which is costlier than the brisket menu item it replaced — as well as higher sourcing costs for avocado and dairy as part of the reasoning behind the new menu pricing.