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For: Real America News Updated 09 Feb 2022, 12: 14 pm EST
Although Chipotle has not reported an eventual increase in the price of its menu, it is possible that it will happen, since inflation continues, CEO Brian Niccol told The Wall Street Journal.
According to the fourth quarter sales report 2021 of Chipotle, the fast food chain reported sales that exceeded expectations, as revenue increased by 22% YoY at $2 billion.
The financial director of the brand, John Hartung, indicated that the margin of the quarter Chipotle’s quarter was affected by inflation, mainly in relation to the price of meat and its transfer, the executive added that the cost of avocados avocados also rose.
According to data from D U.S. Department of Agriculture, wholesale beef prices increased by as much as 40% during 2021. In addition, the costs of transportation rates increased considerably in October, according to data from Cass Information Systems.
On the other hand, Bloomberg pointed out that Avocado costs recently represented an all-time high due to an increase in production costs, a shortage of labor and a bottleneck in the supply chain.
All these increases in the prices of groceries, led to Chipotle deciding to make cost adjustments to its menu by 4% in December, John Hartung said. The restaurant chain also raised prices on the entire menu last June.
Menu prices are now approximately a 10% higher than the first quarter of last year, Brian Niccol noted on the earnings call.
According to the Chipotle website, a chicken burrito costs $10.22 dollars in New York City. That’s about 8% more expensive than its retail price of $9.50 in June past, reported USA Today.
The Bureau of Labor Statistics recently noted that the entire fast food industry is struggling with inflation, which reached a maximum of in 14 years of 7% year-on-year last December.
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Restaurants are also grappling with rising labor costs in a tight labor market amidst a slew of resignations as many workers who remain labor force demand wage increases.
Experts have said that inflation will continue throughout this year, but it is expected that until 2023 the prices of goods and services will fall.
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