Seriously, you people act as if Chipotle has a lock on the burrito market and "all-natural" food in general but the reality is anyone with restaurant experience can duplicate Chipotle's no-frills assemblyline burrito "experience" since there is nothing at all proprietary about this place.
You could've said the same thing about Starbucks and the truth of the matter is many have tried but none have succeeded anywhere close to SBUX's success. I'm quite certain there will be others the will attempt to imitate CMG and none will come anywhere close to the success of CMG on the same scale.
It's true that other burrito chains could compete successfully against Chipotle. But I've watched several chains try in the Colorado market for the past 10 years and none of them have succeeded. 10 years ago one family-run restaurant in Broomfield tried to duplicate Chipotle's interior look. They got it so close that you would have thought they were part of the Chipotle chain. But it only took one taste of their very bland, less-than-fresh food to know they were definitely not in the same league as Chipotle. Their restaurant closed in less than 6 months. For the past 6 or 7 years Qdoba has tried to compete with Chipotle on food taste and quality. Their food is ok, but not at the same level as Chipotle's. Qdoba never has the lines that Chipotle does. Wahoo's Fish Tacos and Baja Fresh also compete against Chipotle, but don't come close. There are plenty of delicious, authentic family-run sit-down Mexican restaurants in the area, but their service is much slower than Chipotle's, so they can't compete on speed.
Chipotle also has a signature salsa (their hot Chipotle salsa) that by itself keeps many customers, like me, coming back frequently. No other burrito chain that I know of has a signature salsa or menu item that can only be bought in their restaurants.
Chipotle understands that speed of service, modernity and simplicity of decor, quality of ingredients, and more importantly unique and excellent flavor and texture of ingredients, makes for a better customer experience. So although there is "almost zero" barrier to entry, there is enough of a barrier that no other burrito chain has beaten Chipotle yet in its existing markets. And judging by the very positive blog postings I see from new markets, the first-mover advantage that you deny definitely exists.
But then why didn't a sharp group of well capitalized young executives start a Starbucks like business in say '92, as the recession ended. Starbucks shops are fine; but it could have been done better.
_Same high quality commercial equipment and coffee.
_Better trained staff.
_Certainly a better logo than the plastic green & white hippy lady.
Golden opportunity for someone to copy/surpass a gold mine formula while Starbucks was still relatively small. Hmmm. So why not?
Anyone remember "McDowell's" from the movie "Coming To America".
With your rationale, it's only a matter of time before somebody duplicates the McDonald's racket and puts burger joints all across the country, hence putting the golden arches out of business.
Hmmmmm, my money is still on McDonalds (& CMG).
>> the reality is anyone with restaurant experience can duplicate Chipotle's no-frills assemblyline burrito "experience" since there is nothing at all proprietary about this place.<<
CMG may not have proprietary qualities, however, they are highly disruptive to the fast food industry. Instead of creating a sustaining innovation (ie burgers , drive thru, ect) CMG has made their mark with disruptive technologies (naturally raised, no hormones or antibiotics, fresh food). These are the changes that are toppling the restaurant industry's leaders! CMG also has the first mover advantage.
Go short at your own risk.
There's no such thing as a "first mover advantage" since Chipotle is opening up in locations where people have never heard of them. If the other restaurant chains are wise enough to offer similar fare and duplicate the decor of the Chipotle restaurant(shouldn't cost more than $100K per restaurant for hardwood floors, track lighting, new paint)and add additional vegetarian items to the menu, Chipotle would not stand a chance and you'll see SSS #'s drop like lead brick.
I'm not short yet, but plan to be after the earnings announcement. Maybe I should pump this stock a little higher, this is somewhat counterproductive ;)