Chipotle Pledges $10 Million to Help Local Growers Meet Safety Standards
February 08 2016 - 4:50PM
Dow Jones News
Chipotle Mexican Grill Inc. said it plans to set aside up to $10
million to help local growers meet its new food-safety standards,
as the burrito chain outlined for its employees its efforts to
recover from disease outbreaks tied to its food that have roiled
its business.
The company closed its roughly 2,000 restaurants on Monday so
more than 50,000 workers nationwide could tune in to a meeting with
executives in Denver, who explained new procedures for keeping
pathogens out of its food.
Steve Ells, Chipotle's founder and co-chief executive, said new
protocols for testing ingredients could be costly for small, local
farmers, but he added: "We're there ready to help them."
"We'll continue to source the same high-quality ingredients,
raised with respect for animals, environment and farmers," Mr. Ells
told employees, according to the company's Twitter feed.
Chipotle has been reeling from a series of outbreaks involving
E. coli and other pathogens that together sickened hundreds of
customers nationwide last year.
The Centers for Disease Control and Prevention last week
declared an end to two E. coli outbreaks, one that began surfacing
in the Pacific Northwest last October before spreading to several
states, and a second, smaller one it announced in late December.
The CDC said it was unable to identify an ingredient responsible
for either outbreak. The Wall Street Journal, citing people
familiar with the investigation, reported last week that Chipotle
believed the cause of the larger outbreak was beef imported from
Australia.
In addition to the E. coli cases, Chipotle customers last year
were sickened from a salmonella outbreak involving tomatoes in
Minnesota as well as outbreaks of norovirus in California and
Boston.
In December, Chipotle was served with a grand-jury subpoena as
part of a federal criminal probe seeking information on the
California norovirus outbreak. Chipotle last week said it received
another subpoena broadening the investigation's scope, requiring
Chipotle to produce documents related to companywide food-safety
matters dating back to Jan. 1, 2013. As of Friday, Chipotle's stock
was down 28% since late October. The shares were down more than 3%
in afternoon trading on Monday.
Competitors took advantage of Chipotle's temporary closure on
Monday with special offers. Moe's Southwest Grill, part of Focus
Brands Inc., offered a buy-one-get-one-free deal in an effort to be
Chipotle customers' "rebound burrito." Freshii USA Inc. offered
half-priced Mexican food. Chipotle struck back with a deal of its
own: customers who texted in the word "raincheck" during a certain
window of time on Monday received an offer of a free burrito.
Write to Julie Jargon at julie.jargon@wsj.com
(END) Dow Jones Newswires
February 08, 2016 16:35 ET (21:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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