Chipotle Refocuses on Main Brand After Health Food Concept Failure: California’s Labor Cost Challenge Causes Price Hike

After launching its health food restaurant concept, Farmesa, in Los Angeles in 2023, Chipotle has decided to refocus on its main brand. The futuristic concept primarily relied on kiosks and third-party delivery apps for ordering and featured healthy foods like proteins, greens, grains, and vegetables.

At the time of Farmesa’s launch, Nate Lawton, vice president of new ventures at Chipotle, expressed optimism about the concept. However, Chipotle CEO Brian Niccol has decided to shift the company’s focus to turning Chipotle into an iconic brand rather than exploring new concepts. While Niccol hasn’t completely ruled out the possibility of a new concept in the future, his current priority is to grow and solidify the Chipotle brand both in the U.S. and internationally.

The closure of Farmesa comes amid a challenging time for fast-food operators in California where the state implemented a $20 minimum wage for workers earlier this year. To offset increased labor costs, Chipotle has had to raise prices by 6%-7% in the state. Despite these challenges, Niccol is confident that with continued growth and expansion of their iconic brand will make them more profitable in the long run.