Market Potential Analysis

Shawna Jones, Mollye Peters, Jessica Otterman, Erica Steele

Company Background
Started in 1993 Denver, Colorado Found and CEO: Steve Ells Food With Integrity 837 locations 33 states, District of Columbia, and Toronto, Canada
(Chipotle Mexican Grill, 2009)

Fastest growing U.S. restaurant chain (% increase in foodservice revenue) (Basham, 2009)

SWOT Analysis
Strengths
Naturally raised chicken and pork Green buildings No artificial flavorings or colors Vegetarian and vegan choices Over 300 restaurants recycle

Weaknesses Not fully expanded in the U.S. Only 50% of stores have natural beef Difficulty to fulfill Food With Integrity philosophy

Opportunities
Eco-friendly trend in design Popularity of natural food products and trend in healthy choices

Threats
Attitudes toward American brands Restaurants in foreign countries mostly run by natives (Eating Places, 2009).

(Chipotle Mexican Grill, 2009)

Macroscreening
Positive attitude towards dining out Eating out as a convenience or social pastime

Four Promising Nations

Australia Ireland United Kingdom Japan

Criteria and Weights

10% 20% % Import Growth- Food & Beverage Industry 15% Ease of Doing Business 20%

Urban Population

15%

Population Growth Rate

PPP Per Capita 20% Likeliness of Dining out

Urban Population
Urban Population (2008)
90% 80% 89% 80% 77% 74% 68% 61% 77% 90% 87%

70%
66% Percent of Total Population 60% 50% 40% 30% 20% 10% 0% 43%

Country

(Central Intelligence Agency, 2009)

% Growth of Import of Food and Beverage Industry

Growth of Food/Beverage Imports
100.00% 90.00% 80.00% 98.80% 83.39% 72.46% 59.57% 60.77% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% Australia Canada Japan UK China France Germany Ireland Country Italy New Zealand Spain 38.53% 52.72% 63.15% 53.06% 74.93% 76.87%

Percent Growth for 5 Years

70.00%

(CenTradeX, 2007)

Ease of Doing Business

Ease of Doing Business
90 80 70 65 60 50 Rank 40 30 20 10 0 Australia Canada Japan UK China France Country Germany Ireland Italy 49 83

31
25

12
8

10

7 2 New Zealand Spain

(CenTradeX, 2009)

Population Growth Rate

Population Growth Rate
1.200% 1.195% 1.120% 1.000% 0.817% 0.800% 0.655% 0.600% 0.549% 0.935%

0.400% 0.279% 0.200% -0.191% 0.000% 0.072%

-0.053%

-0.047%

-0.200%

(Central Intelligence Agency, 2009)

PPP Per Capita

PPP per Capita (2008)
$50,000 $45,300 $45,000 $40,000 $38,100 $39,100 $36,500 $35,400 $33,200 $31,300 $28,000

$35,000
$30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0

$34,000

$34,700

US Dollars

$6,000

Country

(Central Intelligence Agency, 2009)

Likelihood of Dining Out

Likelihood of Dining Out
10 9 8 7 6 Ranking 5 4 3 2 1 0 Australia Canada Japan UK China France Country Germany Ireland Italy New Zealand Spain 1 7 6 5 4 3 2 8 7 10 9

(Euromonitor International, 2009)

Model
Australia Criteria Urban Population Weight 20% Ireland Japan UK Rank Weighted Rank Weighted Rank Weighted Rank Weighted 9 1.8 2 0.4 3 0.6 10 2

% Growth (5yr) of Imports for Food & Beverage Industry Ease of Doing Business Population Growth Rate PPP Per Capita Likelihood of Dining Out

20% 20% 15% 15% 10%

10 6 10 8 7

2 1.2 1.5 1.2 0.7 8.4

9 8 9 10 9

1.8 1.6 1.35 1.5 0.9 7.55

1 5 1 5 5

0.2 1 0.15 0.75 0.5 3.2

4 9 5 7 8

0.8 1.8 0.75 1.05 0.8 7.2

Selection

Australia

Rationale
Economy has seen over 17 years of continuous growth

High affinity towards American products

Tendency towards healthy and active lifestyle

Egalitarian and values relationships

Voted 2nd most ethical nation to conduct business with

Population is approximately 21,262,641 (July 2009)

(Global Road Warrior, 2009)

Prospective Cities
Sydney
4,193,500 urban population wealthiest city in Australia possesses many tourist attractions

Melbourne
3,698,200 urban population cultural capital of Australia center of business

Brisbane
1,849,500 urban population largest city in the world in terms of land mass night life

(Global Road Warrior, 2009)

Sales Forecast - Industry

Food Service Industry Sales for 2010 in Australia
Method 1: Approximately $1.24 billion (World Fact Book U.S. and Australian urban populations Australia & US, 2009) Projected U.S. Food Service Industry Sales for 2010
(Basham, 2009)

Method 2: Approximately $781 million Australian Foodservice Market Volume Australian Market Segmentation for Fast Food
(Datamonitor Industry Market Research, 2009)

Sales Forecast - Brand

Method 1: Approximately $1.8 million for 3 locations in 2010 ($607,343 per store) Approximately $2.1 million in 2011 (Chipotle ($732,000 per store) Mexican Chipotle restaurant sales for 2007 and 2008 Grill, April Total number of locations for U.S. 2009) Urban population of U.S. compared to Australia
(World Fact Book - Australia & US, 2009)

Sales Forecast - Brand

Method 2: Approximately $6.4 million for 3 locations in 2010 ($2.1 million per store) Approximately $6.6 million in 2011 ($2.2 million per store) Total sales, number of restaurants, and growth rate for McDonalds
(McDonald's Australia - A case study of a multinational operating within the Australian Economy, 2007) (Datamonitor Industry Market Research, 2009) (McDonald's (Australia), 2009)

Basham, M. (2009, September 3). Industry Surveys: Restaurants. Retrieved October 6, 2009, from Market Insight Database. CenTradeX. (2009). Country Comparator - Tools & Games - globalEDGE. Retrieved October 6, 2009, from globalEDGE: http://globaledge.msu.edu/countries/countryrank.asp?Year=2008&Statistic=12465 CenTradeX. (2007, March). Food and Beverage Industry Trade Statistics - globalEDGE. Retrieved October 6, 2009, from globalEDGE: http://globaledge.msu.edu/industries/Foodand-Beverage/tradestats/ Central Intelligence Agency. (2009, October). World Fact Book. Retrieved October 4, 2009, from CIA - The World Fact Book: https://www.cia.gov/library/publications/the-worldfactbook/ Chipotle Mexican Grill. (2009, April). 2008 Annual Report and Proxy Statement. Retrieved October 6, 2009, from Chipotle.com: http://phx.corporate-ir.net Chipotle Mexican Grill. (2009). Chipotle: Gourmet Burritos and Tacos. Retrieved October 6, 2009, from Chipotle Mexican Grill: http://www.chipotle.com/#/land Datamonitor Industry Market Research. (2009, August 15). Australia-Foodservice. (Industry overview). Retrieved October 5, 2009, from Business and Company Resource Center: http://galenet.galegroup.com

Works Cited

"Eating Places." Encyclopedia of American Industries. Online Edition. Gale, 2009. Reproduced in Business and Company Resource Center. Farmington Hills, Mich.:Gale Group. 2009. http://ezproxy.butler.edu:2133/servlet/BCRC Euromonitor International. (2009). Country Reports: Australia. Retrieved October 7, 2009, From Global Market Information Database. Global Road Warrior, The (2008). Australia: Business Culture: Business Ethic and Framework. Retrieved 10/11/2009, from www.globalroadwarrior.com/ContentInfo.asp?nid=13.03&cid=7&next_nid=13.04&ctry=Aust ralia&parent=Business%20Culture Global Road Warrior, The (2009). Welcome to Australia. Retrieved October 7, 2009, from Global Road Warrior: http://globalroadwarrior.com/welcome/asp?cid=7 McDonald's (Australia). (2009). Our Story. Retrieved October 8, 2009, from McDonald's (Australia): www.mcdonalds.com.au/about-us/our-story McDonald's Australia - A case study of a multinational operating within the Australian Economy. (2007, February 21). Retrieved October 8, 2009, from Australian Trade Comission: www.austrade.gov.au/ArticleDocuments/1454/EFF_mcdonaldscasestudy.pdf.aspx World Fact Book - Australia & US. (2009). Retrieved October 7, 2009, from World Fact Book.

Works Cited

Questions?