This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Chipotle's Monty Moran Unwraps the Restaurant's Success Story

Stocks in this article: CMG MCD SBUX

Sozzi: Are you concerned about culture preservation as the company grows even larger?

Moran: The name of the game to making sure the culture works, and is sustainable, is making sure that we have enough restaurateurs being developed. Then, we have to make sure enough restaurateurs are rising up into positions of leadership in the company. We are pleased to see that a lot of this is happening.

Sozzi: Have you and the team noticed over the past year or so even more qualified applicants seeking to join the Chipotle team?

Moran: Yes, I think the average quality of applicant that comes into a crew position today is vastly superior to what it was five, six, seven years ago. People come to us because they have heard of us now, not just as a concept, but also as a people-oriented culture. They come because they have heard of the opportunities, and we have a lot more applicants than we used to, and we are able to be a lot pickier. I think we are also better at picking for positions in the restaurant. We really take a long view of everyone that gets hired at Chipotle.

The more people see their peers moving up, the more the word of mouth carries out, the more people recommend us to their friends. And because the opportunities are so significant to move up, we get people that are willing to take, I would say, significant demotions in terms of position. For example, being a crew member at Chipotle, so they can move up and become restaurateurs.

Sozzi: Could you take us through where new technology has begun to appear inside the restaurants?

Moran: In terms of mobile and online ordering, years ago we rolled out an application for your iPhone and then Android very recently rolled that out. The reason we worked through these was really to provide convenience to some of our customers that are pretty tech savvy. We didn't want to be low tech and then disappoint their desire to have that way of ordering Chipotle. Of course, we have the online ordering system now by which, between phones and online, is 4% of our business today. It's a significant amount of business.

Sozzi: What are you doing right now operationally to take Chipotle's best-in-class line speed up another gear?

Moran: From an equipment standpoint, having these great new tortilla presses that we basically designed and invented some years ago, and which now are in most of our restaurants, that heat the tortilla more quickly and evenly so it's easier for our crews; the change machines we rolled out some years ago.

But the No. 1 thing that helps throughput is our focus, a couple of years ago we started with our four pillars of throughput. We have found that even if there are 100 things you could do to improve the throughout, 90% of the benefit you'll get is contained within these four pillars, which are very specific things we teach each person in our restaurant to do.

Two of them are actually positions in the restaurant, an expeditor, which is the person standing between the person that rolls the burrito and the person who serves it, and who makes sure to put it in the bag to go, get you a drink if you need one, or chips and guacamole if you wish to have that. So, the cashier doesn't have to trouble themselves with that. The other is a linebacker who walks behind the line and makes sure the food is full, and the frontline and kitchen are humming, all the spoons and pans are in place, and the line is clean.

The other two are mise en place, French for "everything in its place." Before service starts we want to make sure that absolutely everything is ready to go so people don't have to leave the line during peak hours to go do something that should have been done before. And finally, the other is what we call "aces in their places," meaning having the person that is very skilled at each position in that position at peak hours, and not having them training someone that may not be as skilled.

2 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 18,030.21 +6.04 0.03%
S&P 500 2,081.88 -0.29 -0.01%
NASDAQ 4,773.4720 +8.0480 0.17%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs