Chipotle and Burger King Aren't Trading Places
Image source: Burger King.
Chipotle Mexican Grill (NYSE: CMG)is now a couple of months away from opening its first burger restaurant.Restaurant Brands International's(NYSE: QSR)Burger King is now just six days away from taking its Whopper-dressed burrito national. This doesn't mean that the two quick-service chains are about to begin slugging it out.
That's the narrative that the media would like to see play out. There were many outlets -- financial and non-financial alike -- playing this up as a battle of the brands.
"The new Whopperito is thought to be Burger King's attempt to draw in customers still put off by Chipotle's recent string of food borne illness outbreaks,"argues consumer news hubConsumerist.
The truth isn't that salacious. Sometimes it's just a company trying to grow its reach by giving something different a shot.
This is not a burger or burrito war
There's no reason for Burger King to worry about Chipotle introducing Tasty Made. One single burger restaurant opening in Ohio this fall isn't going to make Restaurant Brands International lose any sleep, just as Chipotle's ShopHouse isn't forcing a sweat at Panda Express or Pei Wei, and Pizzeria Locale isn't making Blaze or MOD panic when it comes to fast-casual pizza.
Chipotle is testing several different concepts. None of them are moving the needle for Chipotle, and none of them are making much of a dent in their respective specialties.
There's also little reason to think that the Whopperrito -- a Tex-Mex spiced burger patty that's chopped up and combined with lettuce, tomato, onions, and queso before being rolled up in a flour tortilla -- will make a dent at Chipotle.Is anyone hankering for Chipotle going to suggest that a burger burrito at BK is a worthy proxy?
It's also a limited-time offering, destined to be gone in a few months unless demand remains brisk beyond the initial novelty purchases. Restaurant Brands International has been giving Burger King plenty of ammo to stand out in a crowded burger market. From flame-grilled hot dogs in February to Mac n' Cheetos in June, Burger King knows how to draw attention. Frankenfood is its middle name.
Burger King will attract curious fast-food buffs to the $2.99 Whopperrito when it goes national next week. Chipotle's Tasty Made will open in Ohio with far more attention than a typical burger start-up. That's fine. It's what Restaurant Brands International and Chipotle are counting on, hoping that free publicity and media attention will beef up business. They're competing for the same taste buds, but this doesn't mean that they're in the mother of all food fights.
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Rick Munarriz has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Chipotle Mexican Grill. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.