Outbreaks of foodborne illnesses harm Chipotle’s sales

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Due to multiple outbreaks of norovirus, Salmonella, and Escherichia coli (E.coli), Chipotle Mexican Grill has experienced a dip in sales and stock value.

Last August, 64 customers in Minnesota were infected with Salmonella and over 100 customers in California became infected with norovirus after eating at Chipotle. Common symptoms included vomiting, stomach pain, nausea and diarrhea. E. coli outbreaks in October and November affected 53 people across nine states. In December, another outbreak infected 140 Boston College students with norovirus.

Since then, Chipotle’s sales have continued to drop. Chipotle predicted that the outbreaks and criminal investigation will end up costing $14 to $16 million. Within the past five months, the value of Chipotle’s stocks have dropped from over $750 to $428 a share, a 42 percent decrease. Customers have been discouraged from eating at Chipotle restaurants as the United States Justice Department began a federal criminal investigation on the company for its handling of the outbreaks.

Chipotle chief executive officer (CEO) Steve Ells apologized to customers in a letter on the Chipotle website and attempted to reassure them.

“I’d like to take this opportunity to apologize on behalf of all of us at Chipotle, and to thank our loyal customers who have stood by us through this difficult time,” Ells said.

On Feb. 8, Chipotle plans to close down its restaurants all over the nation for several hours to discuss new policies and answer questions from employees.

 

by Tom Cheah

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