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Chipotle E.Coli Outbreak Over: Will Customers Come Back?

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Amid Chipotle's seemingly never-ending history of food contamination outbreaks, winning back its customers won't be an easy feat.

On Feb. 1, health experts declared that the E. coli outbreak connected to the Mexican Grill restaurant appears to be over as there have been no new cases of the illness since November last year.

Although the outbreak has ended, the Centers for Disease Control and Prevention (CDC) said the source of the E. coli contamination remains unknown.

However, when an outbreak is declared over, investigations will also come to a close.

"When a restaurant serves foods with several ingredients that are mixed or cooked together and then used in multiple menu items, it can be more difficult for epidemiologic studies to identity the specific ingredient that is contaminated," wrote the CDC.

Chipotle's Plans Are Quite Optimistic

Chipotle is now focusing on putting its best foot forward. The restaurant will be concentrating on the implementation of its new food-safety measures across its 2,000 restaurants.

This involves new handling and cooking procedures for vegetables and fruits.

Chris Arnold, Chipotle's spokesperson, said the restaurant cooperated fully with investigations, and is pleased the CDC has completed its probe. He said because investigators did not determine a single cause, the restaurant will not speculate on what it was.

"Because we may never know what caused this, we have taken a number of steps to enhance the safety of every ingredient we use," said Arnold. "We are confident that the changes we have made mean that every item on our menu is delicious and safe."

The Mexican Grill restaurant is also planning to execute a big marketing push this February, including an extensive advertising and social-media campaign to boost its image.

On Feb. 8, Chipotle will be closing all its branches for a few hours for its all-company meeting. The restaurant will discuss matters regarding the food-borne illness outbreaks and proper responses.

Chipotle Has Plenty Of Work To Do

Nicole Miller Regan, an analyst that covers Chipotle for Piper Jaffray & Co., said Chipotle still has plenty of work to do before it can return to its "glory days."

"It is resolution to some degree. In the long term, the CDC doesn't drive same-store sales," she said.

Meanwhile, the NPD Group said what might help keep Chipotle afloat are its loyal customers: young adults and teenagers.

The challenge will be earning the trust of customers who are over the age of 25 years old, but NPD's analyst Bonnie Riggs said Chipotle has history in its favor.

"There are a number of chains that have had challenges like this, but they've been able to overcome it. Some have taken longer than others," added Riggs.

Chipotle's sales have plummeted and shares have sunk during the food contamination outbreaks. On Monday, the stock closed the day at $19.67 to $472.64, a big fall compared to that in October wherein shares traded around $747.

In the end, according to FactSet, analysts do not expect the Mexican Grill restaurant's earning to recover until the third quarter of 2017.

Photo: Mike Mozart | Flickr

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