retail news in context, analysis with attitude

by Kate McMahon

All eyes are on Chipotle Mexican Grill in the Pacific Northwest this week, as the fast casual chain is set to re-open 43 restaurants shut down after an E. coli outbreak.

Although investigators have not yet been able to pinpoint the source of the outbreak that sickened 42 patrons at 10 sites in Washington and Oregon, Chipotle and health officials said yesterday the risk was over.

The next pressing question is whether consumer confidence will be rattled by this, coming on the heels of a Salmonella outbreak traced to tomatoes that affected 60 Chipotle customers in Minnesota in September. Though not food-borne, a norovirus hit 100 employees and diners at a California Chipotle in August. There have been hospitalizations – and lawsuits - but no deaths in the three outbreaks.

The irony is Chipotle’s “Food with Integrity” mission to provide fresh, locally sourced ingredients makes it all the more susceptible to such outbreaks. Food safety experts note that fresh produce and meats from small farmers can be more vulnerable to food-borne illness, compared to products from large suppliers which have the resources to test for dangerous pathogens. The positive news is the outbreaks can be relatively contained, since the produce is indeed local.

For Chipotle, the timing of the late October outbreak could not have been worse.

Facing slowed sales growth and increased competition, Chipotle altered its annual Halloween “boorito” promotion on social media. Instead of offering free (initially) or cheap ($3) burritos to customers who showed up in costume on Halloween, Chipotle upped the politically correct ante. To draw attention to “creepy” and “scary” additives in other fast food offerings, your costume had to have an "unnece-scary” addition.

And then Pacific Northwest E. Coli Shutdown occurred on Halloween. The reaction on Facebook and Twitter? “Talk about scary. I’d rather have the additives!” and “Don’t forget--E. coli is 100% natural! Yay Chipotle!” were typical posts.

Chipotle’s most vocal critic was also quick to capitalize on the news. “You can’t spell Chipotle without E. coli” blared the ad in the New York Post last week from the Washington, D.C.-based lobbyist Center for Consumer Freedom, which has called the chain “Chubby Chipotle” for its high-calorie offerings.

Chipotle said yesterday it had cleaned and sanitized the 43 restaurants after tossing all food, tested employees for E. coli and the sites would reopen “in the coming days with a fresh supply of new ingredients.”

The chain also said it was working with health officials to improve food handling processes and adding audits and inspections in all of its 2,000 restaurants.

Given Chipotle’s “holier than thou” reputation, I’m sure competitors were watching this unfold with glee.

But I think this is a lesson for restaurateurs and retailers seeking to meet America’s demand for more locally sourced, natural or additive free products. The experts say the tradeoff is simple: Fewer preservatives, the greater the potential risk of harmful microbes being present. In order to minimize that risk, attention must be paid to food sources before they are served or sold to the public, and immediate action taken if there is any cause for concern.

I give Chipotle credit for shutting down 43 outlets when only 10 were implicated, and being transparent throughout the process. In the end, that may be the biggest lesson of Chipotle's food safety problems - that transparency and clarity will be absolutely critical in achieving, maintaining and, sometimes, restoring consumer trust.

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