Last week, The Motley Fool hosted Chipotle
Moran has been co-CEO of the fast-food burrito chain since January 2009, during which time the stock has run up more than 300%. Chipotle makes food based on its "Food With Integrity" philosophy, which emphasizes locally sourced, sustainable ingredients. With more than 1,000 restaurants selling burritos in the U.S. and Canada, Chipotle is branching out with a new Asian concept -- but don't expect a drive-thru any time soon.
We ran part 1 and part 2 of the chat earlier this week; here's the third and final installment.
NYC: You mentioned your "unconventional" leadership style. Did you learn some of your style from any mentors? Are there any so-called leadership books out there that you recommend?
Monty Moran: There really aren't any particular books that have inspired me in this regard. The best advice I ever got about leadership was "to be yourself." Leadership has to be genuine. If you try to be someone other than who you are, everyone knows it anyway, so why fake it?
You need to be vulnerable, demonstrate that you know your weaknesses, be quick to ask for help from others, and appreciate where others are more talented than you are. You need to have a solid vision for where you want to take your organization. When you communicate that, and have developed trust through the aforementioned qualities, people feel good about following you, as they trust that you'll take them to a better place.
Patrick: First, let me thank you for bringing Chipotle to Alabama. Are there any plans in the works for franchising opportunities?
Monty Moran: You're welcome, Patrick. I'm glad you're enjoying us in Alabama.
As for franchising, we have no plans to do that at this time. All of our restaurants are company-owned.
The primary reasons for franchising are to raise capital, or to find committed people to run your restaurants. Right now, we have plenty of capital, and our people culture is developing terrific leaders who can run our current restaurants and who are ready to take on additional opportunities as we grow. With so many great people in the wings, we want to preserve these opportunities for our top performers: specifically our Restaurateurs.
Helen: The next time I go to Chipotle, what are one or two things I can look for to gauge the performance of that location?
Monty Moran: Great question, Helen.
As soon as you walk in the door, stop, look, and listen. What do you see? What do you hear? How do you feel? Is it exciting? Is there a lot of energy? Is the crew smiling or otherwise totally committed to serving customers? As you look further, is the line moving quickly? Does the food look hot and freshly cooked? Is the restaurant clean and organized? And, of course, is your food delicious?
I think you'll find that most of our restaurants have very high-performing teams who are genuinely about serving customers and making delicious food. Because they really like what they are doing -- and that they take pride in it -- you should feel that enthusiasm across the counter. That, more than anything else, is how I'd judge the success of Chipotle.
The financial aspects of the business just follow from there ...
Ella: How many times a day do you check the stock price?
Monty Moran: I tend not to check it much at all. We don't define our success by daily fluctuations in the marketplace. As I said in the previous question, the financial success depends on how well we run our restaurants and serve our customers.
In the long run, if we do a great job delivering a great customer experience, empowering our top performers, and serving great food, we'll be on our way to achieve our mission to change the way people think about and eat fast food. Over the long term, we believe people will notice this, and choose to eat at Chipotle. When they do, we will be financially successful, and over time the stock price will be just fine.
By the way, what is the price today? (lol)
Analyst: What is your typical response to a person that claims your food to be "unhealthy"?
Monty Moran: Our food is made from very high-quality, simple real ingredients. There is no sugar in our food, no preservatives (except tortillas, but we're working on that!), and no artificial anything. I can't imagine why someone would say that our food is unhealthy.
Now, of course, our food is totally customizable. The customer chooses what they eat. This service format allows us to meet most dietary preferences. You can have low-carb or high-carb; low-fat; vegetarian; high or low protein, gluten-free, etc.
Camille: What's the biggest untapped opportunity for Chipotle?
Monty Moran: The biggest untapped potential is for people to become more educated about where their food comes from, what's in it, how it's cooked, and how the source of those ingredients affects animals, the environment, and people. The more interested people get in learning about this, the more they'll appreciate what we're doing here at Chipotle.
Sharon: Monty, any plans for a drive-thru? We'd love it!
Monty Moran: At his time, we don't have any drive-thrus, and don't have any plans to add them. The Chipotle experience involves interacting with our wonderful teams, experiencing the energy inside the restaurants, seeing or hearing the food being cooked in the restaurant, and eating it while it's fresh and hot in our comfortable surroundings. With a drive-thru, much of this would be lost.
Jack: As you get bigger and bigger what are the aspects of the business that become more difficult to manage and how do you evolve and manage those hurdles?
Monty Moran: The biggest difficulties are being sure we have the very best people running our restaurants. So far, it's going very well because our excellent Restaurateurs and restaurant managers, as well as our mid-management teams, are working very hard to build the very best culture possible.
It's always a challenge to find enough high-quality raw ingredients to keep up with our growth, but so far, because of our excellent relationships with like-minded suppliers, we're doing quite well keeping up with our growth so far. But it's very important to us to continue to improve the quality of our raw ingredients. This is an ongoing mission that will be challenging for years to come. But this is our passion, and we believe that the food we serve 10 years from now will be better than it is today.
Moderator: That's a wrap, Fools. Many, many thanks to Monty for taking this hour to answer all these great questions. Monty -- any plans to open up a Chipotle closer to FoolHQ? The closest location is 1.1 miles away.
Monty Moran: Thanks for having me. If you have one within 1.1 miles, you're better off than lots of other folks. But D.C. is one of our best markets in the country and right now I'm going to walk to our chief development officer's office and see if there is anything we can do about your request! I hate to deprive a Chipotle fan of easy access to great food.
Thanks everyone for your great questions. Sorry I couldn't get to all of them, but I'm sure thankful for all of your interest. Maybe we can do this again another day.
