Wells Fargo Analyzed Chipotle’s Burritos. They’re Actually Bigger Now

The burritos will be bigger, and you can take that to the bank.

An investigation from Wells Fargo last month may have helped push Chipotle to finally come to terms with its alleged portion problem. Wells Fargo analyst Zachary Fadem led a team of financial professionals who ordered 75 burrito bowls from eight NYC locations to determine if the Mexican grill truly was scrimping on chicken. The team found that inconsistency varied widely between stores, according to Barron’s. 

Then, in its latest earnings call last week, the California-based chain said it found 10% to 15% of its stores were receiving a disproportionate amount of complaints about portion sizes. The company said it will spend an extra $50 million on training to ensure workers serve “correct and generous” amounts. 

“We’re telling our teams: ‘Listen, we don’t want you to be skimping on portions,’” Chief Financial Officer Jack Hartung said during the call. “If you’re not sure whether to go a little more or a little less, go a little more.” 

Shrinking Returns

In an era of high rates, food costs, labor costs, and well, everything else, Chipotle was one of the few thriving restaurants still able to offer higher-priced items, while competitors like McDonald’s, Wendy’s, and Burger King scrambled to put out $5 value meals. 

Toward the end of June, Chipotle was the only food chain among the top 20 performing stocks on the S&P 500 this year. As of last week, however, it had fallen to the 199 spot. Year-to-date returns have shrunk to 11% after hitting a high point of about 52% on June 18.

Where’s the Beef? The debate over size started after social media users called the brand out for shrinkflation in recent weeks. Users posted hundreds of videos of skimpy-looking burrito bowls that were supposed to include two hearty scoops of rice and four ounces of meat. According to Barron’s, the Wells Fargo investigation also found:

• The largest bowl on record was 26.8 ounces while the smallest was 13.8 ounces. The median size across all stores was 21.4 ounces. 
• The analysis found that location was the biggest determining factor. The median bowl size at one store was 23.5 ounces while the median bowl size at another store was just 17.7 ounces. 
• To avoid extra variables, every order was the same: consisting of rice, black beans, chicken, pico de gallo, cheese, and lettuce. 

A well-deserved thank you to all the Wells Fargo analysts who may have needed an after-lunch burrito nap during the making of this research.