TJ Lowden Kathy Wang Onkar Kapoor Bryan Jolly Bangalore Burrito (Coming to a New Delhi Near You) STRT 571 – Final Project
Feb 07, 2016
TJ LowdenKathy Wang
Onkar KapoorBryan Jolly
Bangalore Burrito(Coming to a New Delhi Near
You)STRT 571 – Final Project
Chipotle: Moving to IndiaCompany Overview
22,000 Employees$1.3B Revenue / $140M Profits25% Average YoY Revenue Growth over last 5
YearsFirst International Expansion: April 2010 in London
Analysis of Expansion into India
Decision: Go (with the Right Partner)
Strategy RisksProfitability
$10M Initial FDI 40% Contribution
Margin 8-Year Breakeven
Point 12.5% Return on
Investment
“Few Things Well” Use 49/51 Joint
Venture Two Locations
New Delhi Bangalore
JV for Social and Legal Risk Mitigation
Controlled Political and Technological Risks
Volatile Rupee: 39 to 51
Strategic Fit
ID Key Resource
Improvement Strategy
1 Marketable Cuisine Adapt menu to address demographic
3 Brand Improve brand awareness in India with similar US promotions
8Business Acumen
Improve via strong JV partner for expansion into right markets and conduct business operations
USA India
Consistent Key Strengths: 2) Financial Stability; 5) Available Capital; 7)Restaurant Efficiency
Revenue 1,331,968,000 Stores 837 Revenue per Store 1,591,360
ExpensesFood, Beverage, & Packaging Costs 431,947,000 Labor Costs 351,005,000 Occupancy Costs 98,071,000 Total Expenses 881,023,000 Stores 837 Expenses per Store 1,052,596
Contribution Margin per Store 538,763
Contribution Margin in US Stores 33.86%
Expected Contribution Margin in India 40.00%
FDI Assessment
Recent Recession reduced FDI in India
Increasingly Open Capital
Flows
Managed Floating
XR
RBI Controlled Monetary
Policy
5Expansion poses risks but they can be managed with the
“Right” JV Partner
Risk type Mitigation PlanImplications
Risk Analysis and Mitigation
Questions?