It has become a recurring nightmare for Chipotle Mexican Grill. A stomach bug that just won’t go away.
The company this week (July 18) closed one of its Sterling, Virginia locations following reports of food illnesses suspected to be norovirus. This is terrible news for the chain, which has been trying to recover from a food safety crisis in 2015 that sickened more than 300 people across 14 states, hospitalizing 22.
As word spread about more illnesses this week, the company stock took a nosedive.
This erases the gains of recent months as Chipotle tried restore its footing in the market. The 2015 crisis had turned many people off the brand, and at one point, the chain’s CEO, Steve Ells, reported foot traffic had dropped by 20%. In the last few months, the company had appeared to be on a rebound.
This second bout of cases raises questions about the management of the company, which operates more than 2,200 restaurants across the US. Analyst Howard Penney said the company should do two things to restore confidence: Stop opening new stores and focus on current operations; and hire more employees to relieve pressure on existing employees.
And then there is the fate of Ells, the beleaguered CEO. Whether he’ll step aside and hand the leadership reins to someone else remains to be seen. “If it’s not the death blow,” Penney said, “it’s getting close.”