Dive Brief:
- Chipotle Mexican Grill's head of food safety James Marsden, who was hired by the fast-casual chain in 2016 after a food safety crisis sickened customers across 14 states, will retire next year, according to Bloomberg. The company is now searching for his replacement.
- Chipotle has suffered a string of highly public E. coli, salmonella and norovirus outbreaks at its restaurants since 2015. Most recently, more than 700 diners claimed they got food poisoning after eating at a Powell, Ohio, restaurant in July — an outbreak that was linked to unsafe food temperatures. These food safety failures have eroded customer confidence in the chain, according to a UBS Evidence Lab survey, which found that 26% of respondents were eating at Chipotle less because of food safety concerns.
- "We have world-class people on our food safety council and food safety's going to be something that's always going to be a high priority for us," Chipotle CFO Jack Hartung said in an interview with CNBC "Mad Money" host Jim Cramer yesterday. "That's not going to change."
Dive Insight:
On its face, the timing of Marsden's departure appears less than ideal. The dust from Chipotle's latest food safety scare hasn't quite settled, and the chain has just begun rolling out more stringent standards and prevention measures — though it's unclear if these initiatives will be enough to keep the brand from becoming synonymous with foodborne illness.
Last month, for example, Chipotle announced it would launch Zenput — a mobile software platform that allows restaurant managers to assign responsibilities such as food storage and opening or closing the location — at 2,450 restaurants to better track food-safety protocols. The company also plans to retrain its restaurant staff nationwide to prevent future outbreaks.
Marsden was tasked with overhauling the Mexican food chain's food-safety standards, but the restaurant was slammed with its largest food poisoning outbreak to date during his tenure. Fresh talent in the role could help rejuvenate Chipotle's efforts to get back on track, a strategy the company has embraced of late. In February, the restaurant tapped Taco Bell alum Brian Niccol as CEO, and hired the fast-food chain's former marketing chief Chris Brandt as CMO shortly after.
Since taking the helm, Niccol has doubled down on Chipotle's commitment to food safety, which he believes requires standards that are unique from competitors' initiatives.
"These wellness checks that we do and other protocols that we execute — you're not going to find that in a lot of other restaurants because we are handling fresh food and we're truly cooking every day in our restaurants," Niccol told Kramer on "Mad Money." "So it just demands that we have a higher level of commitment to food safety and we'll always have to be passionate about being a leader in that space."
Under Niccol, Chipotle has also launched a new marketing campaign focused on its fresh ingredients, announced it will close 65 underperforming locations and rolled out a new points-based loyalty program in an attempt to get back to growth. But given continued consumer wariness of the brand, it's clear that for any of these initiatives to make serious inroads, Chipotle's food safety will need to be rock-solid — a tall order for Marsden's successor.
