Chipotle is weighing whether to raise its prices to keep up with rising costs for ingredients like avocados, queso and sour cream, according to a report.
The Newport Beach, Calif.-based company’s new finance chief, Adam Rymer, told The Wall Street Journal he believes customers would continue to flock to Chipotle despite the “modest” price hikes because the chain would still be a better value option than its rivals.
Chipotle has not yet decided when the price hikes would take effect, or how large the hikes would be, Rymer told the Journal.
Chipotle did not immediately respond to a request for comment.
While fast-food giants like McDonald’s, which in July posted its first sales drop since 2020, have suffered as customers turn away from high prices, Chipotle has continued to shine.
Same-store sales grew 6% in the three months ended Sept. 30 compared to the same period last year. Revenue rose 13% to $2.8 billion from the year before.
Rymer, who said he is focused on maintaining Chipotle’s focus on value, became the chief finance officer in October three months ahead of schedule after Chipotle’s then-CEO Brian Niccol’s sudden departure to lead Starbucks. Rymer has worked in various roles, including vice president of finance, at Chipotle over the past 15 years.
The potential raised prices would not be the first hikes to hit Chipotle’s menus. The Mexican chain’s prices have shot up six times since 2021 – the latest taking effect in April through the company’s California restaurants after Gov. Gavin Newsom raised the minimum wage to $20 an hour for fast-food workers.
But Chipotle’s price changes are lagging competitors’ price hikes, keeping its restaurants a relatively affordable option.
Moving forward, Rymer is eager to boost traffic and sales by cutting down wait times for customers to receive their orders.
To do so, Chipotle is taking the technological route – using robotic systems like the “Autocado” to swiftly cut, core and peel avocados.
The company also expects to implement produce slicers across all of its locations by next summer to cut down on time spent dicing peppers and onions, Rymer said.
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