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Chipotle To Begin Loading Up Burrito Bowls In 800 Small-Town Locations

Chipotle Mexican Grill plans to open up to 800 new locations in small towns over the next few years, The Wall Street Journal reports.

Chipotle in Mobile, Georgia

This expansion is part of the company’s long-term goal of expanding from 6,000 to 7,000 locations, CNBC reports.

The chain, founded in Denver in 1993, quickly became a mainstay for office workers during lunchtime in large cities. Before 2021, Chipotle’s expansion efforts were largely focused on busy suburban areas. But after monitoring the performance of dozens of Chipotle restaurants operating in smaller markets, execs made the decision about 18 months ago to expand its reach into towns and cities with smaller populations. 

Of the five best openings for Chipotle in the past year, four have been in small markets, and some have three times the sales of the average Chipotle. The company attributes this success to its Chipotlane model, which includes a mobile order pickup window. Most of the upcoming locations will integrate these lanes, CEO Brian Niccol said in a conference call with analysts last year.

Locations were chosen based on a few factors, according to Chief Financial Officer Jack Hartung. He told the WSJ these are areas with 40,000 residents or fewer and over an hour away from major metros, so as to not detract business from other locations. Towns include Covington, Louisiana, which has a population of 14,000, and El Centro, California, which has a population of about 44,000.

Chipotle is also expanding internationally, with locations in Dubai and Kuwait coming in 2024. The company said it hopes to expand with hundreds of stores if the locations perform well. 

Growth prospects for Chipotle have helped drive its shares 53% higher and pushed its valuation to $58B, according to the WSJ

The steadiness of restaurant sales this year is reflected by the growth of chains similar to Chipotle. Mediterranean fast-casual chain Cava announced in May it is going public, with expansion plans in place for the Midwest. Also going public is Pinstripes, the company announced in June. The experiential retailer houses a restaurant and bowling alley in its locations and plans to open 150 more. Sweetgreen has been working to double its footprint over the last two years.