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3 Menu Management Strategies Mexican Restaurants Are Using to Simplify Inventory and Maximize Profitability


Photo from Fajita Pete’s

Tight regulations, labor shortages, and economic uncertainty are making Mexican menu logistics particularly challenging in 2023.

The stability of the food supply chain relies on nearly 20 million workers, according to the USDA. But labor shortages have added huge pressures to the system, from farming to production to transportation. There are now two job vacancies in the U.S. for every unemployed American.

Without a robust supply chain, you have no certainty over the availability of produce, the stability of prices, or the quality and safety of the ingredients you purchase.

We looked at strategies some of the biggest Mexican chains have used to mitigate risk in the supply chain and master menu logistics to ensure they can deliver safe, delicious food to customers.

Below, we cover:

  • Examples of Mexican chains making changes to their menu logistics
  • What they did to overcome problems and set up better processes
  • How to put strategies in place to improve your menu and supply chain logistics

By the end, you’ll be armed with strategies and best practices to put into place in your own restaurant to get more control over menu logistics and transparency throughout your supply chain.

Improve Supply Chain Visibility and Efficiency With Traceability Tech

Chipotle’s focus on locally sourced fresh ingredients is one of the chain’s biggest selling points. The “for real” tagline helped the brand grow to become one of the most successful Mexican chains in the U.S. 

But that same ethos led to some big issues. A string of public health incidents prompted authorities to open up an investigation:

Chipotle had to rethink how it manages the supply chain to prevent further outbreaks and rebuild the brand’s public image and reputation. 

Management responded by creating a new set of processes and standards, and hired Mansour Samadpour to overhaul food safety. Realizing the scale of the task, he said: “Being in compliance with industry standards is less than 5% of what companies need to do to make food safe.”

Chipotle moved to a more centralized production model, preparing more menu items at its commissary kitchens and sending them out to the restaurants for final assembly. The real food brand had to compromise some of its values on fresh ingredients to minimize the risk of serving customers contaminated food. 

The team established a number of new measures:

  • Cooking steak sous vide — for a long time at low temperatures in a water bath — in commissary kitchens to ensure bacteria are killed without overcooking the steak
  • Blanching raw ingredients like jalapenos in boiling water to kill bacteria
  • Posting more visual cues in the restaurant reminding employees to wash their hands frequently and stay home if they feel ill
  • Investing in better food safety equipment for suppliers and supporting them with education, checklists, and templates that promote better practices 

Chipotle needed better visibility throughout the supply chain. It tested a new digital tracking system at its Chicago distribution center and restaurants, which tracks ingredients all the way through the supply chain using scannable bar codes.

Amber Engebretson, senior manager of supply chain at Chipotle’s new Center of Excellence for Supply Chain, explains how it works:

“Our traceability program allows us to identify the refrigerated menu item ingredients that have traveled from supplier to distribution center to each restaurant.”

Each case of ingredients is identified by the supplier with a unique code, a pack date, and a use-by date. Employees scan the barcodes as each case moves from the distribution centers to the restaurants. This allows them to trace ingredients back to exactly where they came from, in case of another foodborne illness outbreak.

Aside from building back its reputation, the new system is helping Chipotle: 

  • Minimize the risk of another food safety issue with more accountability for suppliers
  • Trace the source of an outbreak faster to stop the distribution of contaminated food
  • Reduce waste from ingredients going out of date because everything is more closely monitored

As Chipotle’s transformation shows, knowing where every ingredient comes from and being able to trace it through the supply chain can help you identify a problem before it becomes a disaster. And having more control and transparency over where your ingredients come from and your stock levels promotes efficiency and cuts waste throughout your supply chain.

Find Your Menu Differentiator and Shout About It

Read any QDOBA press release and one of the first things you’ll find out is that they offer guac and three-cheese queso at no additional charge. 

Putting this front and center is a direct response to the people moaning about Chipotle charging extra for guac. This key differentiator is almost always mentioned as one of QDOBA’s biggest selling points versus its rival in online customer reviews and in news articles comparing the brands. Qdoba even mocked Chipotle’s “free guac day” by sending a truckload of avocados to one of their Denver restaurants.

QDOBA, like Chipotle, hand smashes avocados in store to make its guacamole. So how is the brand able to offer it at no extra cost? QDOBA builds the cost of extras into its total burrito and bowl pricing. Which is why Chipotle is on average 10.7% cheaper than Qdoba, according to a survey of locations in 25 cities. 

By offering the free add-ons, QDOBA differentiates itself from its rival and gives customers what they want, while covering the cost with higher overall prices. 

For smaller brands, the lesson is to find a differentiator and shout about it. Whatever you can do to stand out from your competition can help your restaurant come to your customers’ minds next time they’re hungry.

Find Reliable Suppliers and Invest in Their Success

Taco John’s is a smaller chain than Chipotle and QDOBA, operating 370 restaurants in 23 states. It plans to open 80 new restaurants over the next three years, expanding from its western roots further east. 

During this growth phase, Taco John’s is tightening up its supply chain, trying to cut unnecessary costs and make every link in the chain more efficient.

Vice President of Supply Chain, Dean Satchwell says carefully choosing the right suppliers is one of the key factors for maintaining consistency and compliance.

“It is important that they understand our needs and will put resources toward helping us, whether that is with R&D to help develop an item or helping us to figure out the best ways to move goods from one place to another,” Satchwell says in an interview with Supply Chain World.

In an uncertain economic climate where the prices of key ingredients are volatile, suppliers who provide cost consistency can help businesses maintain their budgets and profit margins. “The best strategy is to level your costs,” Satchwell advises. “Getting consistent cost helps you to plan your business.”

Mexican restaurant operators looking to emulate Taco John’s supply chain success can note a few takeaways:

  • Don’t always look for the lowest price, but find suppliers that offer stability in the medium to long term.
  • Work with suppliers that will invest in new systems and the research and development required to minimize costs and improve consistency and efficiency.
  • Food costs are vital to margins, but there are many other areas you can trim the fat and spend less.

Get the Right Tech to Manage Your Mexican Menu

There are plenty of lessons to take from what the biggest players in Mexican fast-casual food are doing, but these three stand out:

  • Be more intentional about how you choose your suppliers.
  • Support your suppliers with whatever they need to minimize food safety risks and optimize operations.
  • Improve visibility by tracking ingredients throughout your supply chain.

Once your ingredients get to the restaurant, you can take control of inventory management using specialist tools that help you achieve more with less.

Find out how HungerRush can transform your menu logistics and inventory management, all from your POS system.

See what HungerRush 360 can do.

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