{"id":8925,"date":"2016-11-03T19:16:36","date_gmt":"2016-11-03T23:16:36","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/is-chipotle-facing-a-guacapocalypse\/"},"modified":"2016-11-07T19:30:56","modified_gmt":"2016-11-08T00:30:56","slug":"is-chipotle-facing-a-guacapocalypse","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/is-chipotle-facing-a-guacapocalypse\/","title":{"rendered":"Is Chipotle facing a guacapocalypse?"},"content":{"rendered":"

Once banished for being too fatty, avocados have since exploded in popularity. From avocado toast to avocado smoothies to guacamole, the U.S. demand for the creamy green fruit has increased to nearly 4.25 billion avocados in 2014, almost four times the amount of avocados consumed in 2000.1 <\/sup>Beyond being versatile and buttery, avocados are also high in nutrition and \u2018good\u2019 monosaturated fat. Consequently, many fast casual chains, including Burger King, Subway, and Chipotle, use avocados as a way to enhance their menu offerings and attract customers.<\/p>\n

\"graph\"<\/a><\/p>\n

CLIMATE CHANGE AND AVOCADOS<\/strong><\/p>\n

The U.S. primarily sources its avocados from California, which accounts for 80% of American avocados, as well as Mexico.2<\/sup> The avocado\u2019s native environment is tropical \u2013 it typically takes 72 gallons of water to grow a pound of avocados, compared to 9 gallons of water to grow a pound of tomatoes.3<\/sup> Moreover, avocados are particularly susceptible to changes in climate, such as higher temperatures, heat waves, and water shortages.<\/p>\n

Climate change has led to changing weather patterns, unpredictable agricultural conditions, and more extreme cycles of flooding and drought. Due to pervasive dry spells and excessive heat in California and Mexico, there is a serious shortage of avocados from recent growing seasons. The amount of avocados shipped from Mexico dropped from 44 million pounds in October 2015 to 22.9 million pounds in October 2016 due to inclement growing conditions.4<\/sup> As climate change continues to cause higher temperatures and extreme weather, the long-term supply of avocados may not be able to meet the increased demand, which will only drive avocado prices up.<\/p>\n

THE IMPACT ON CHIPOTLE<\/strong><\/p>\n

Chipotle\u2019s commitment to organic and sustainable ingredients makes it more vulnerable to unexpected shifts in climate. Any fluctuations in avocado prices present major risks to Chipotle, which goes through 97,000 pounds of avocados a day.5<\/sup> In 2014, Chipotle signaled to investors that increasing weather volatility associated with global climate change could have a \u201csignificant\u201d impact on their ingredient availability. A rise in avocado prices due to a shortage of avocados could lead the company to remove guacamole from their menu, causing a wave of concerns over an impending \u2018guacapocalypse\u2019.6<\/sup> Since the announcement, Chipotle has reassured the public that it will not stop serving guacamole any time soon, as this item was a pivotal draw for customers. Chipotle will continue to focus on responsibly sourcing their ingredients, recognizing that its future supply chain is at risk of being constrained by climate change.7<\/sup><\/p>\n

\"chipotle-guac\"<\/a><\/p>\n

RECOMMENDATIONS FOR CHANGE<\/strong><\/p>\n

Interestingly, food production and consumption contributes to an estimated 15-50% of all global climate emissions. Any changes in the food industry can have direct positive impact on the very \u201cforces that threaten their livelihood\u201d.8<\/sup> Given this situation, what can Chipotle do to mitigate the effects of climate change and ensure their future supply of avocados?<\/p>\n

Mitigate Effects of Climate Change<\/em><\/p>\n

With more than 2,000 locations, Chipotle can meaningfully reduce their carbon emission footprint and thereby diminish their own contribution to climate change. Chipotle has already installed Energy Management Systems in restaurants across 32 states, which has decreased their energy use by 13%.9<\/sup> Looking ahead, Chipotle can continue to build, install, and design more energy-efficient systems in order to further lower their carbon emissions.<\/p>\n

Two other restaurants \u2013 Noma and Mission Chinese Food \u2013 worked with Zero Footprint, a non-profit that helps restaurants with climate change, to successfully achieve carbon neutrality.10<\/sup> By learning from the best practices and tactics of other carbon-neutral restaurants, Chipotle can continue to offset their carbon emissions and combat climate change.<\/p>\n

Ensure Avocado Supply<\/em><\/p>\n

Chipotle can also work directly with avocado farmers in California and Mexico to increase their avocado yield. For instance, avocado farmers in California are already looking at new, more efficient ways to grow avocados, including developing tougher, more drought-resistant strains of avocado.11<\/sup> Chipotle can help by investing additional resources to find innovative methods of growing avocados in warmer and drier climates.<\/p>\n

Moreover, some restaurants \u2013 such as Blue Hill in New York \u2013 have gone one step further and co-opted their supply chain.12<\/sup> By owning the farm where it sources their ingredients from, Blue Hill has more control and is less susceptible to supply disruptions. Similarly, Chipotle can consider vertically integrating with certain avocado farmers in order to ensure a steadier future supply of avocados.<\/p>\n

Chipotle, in conjunction with other players in the food industry, can mitigate the effects of climate change and exert greater influence over their food supply. The guacapocalypse, while not imminent, represents one of the many potential consequences of climate change on future food availability.<\/p>\n

Word Count: 765<\/p>\n

 <\/p>\n

Sources<\/strong><\/p>\n

1 <\/sup>Roberto Ferdman, \u201cThe rise of the avocado, America\u2019s new favorite fruit,\u201d The Washington Post,<\/em> https:\/\/www.washingtonpost.com\/news\/wonk\/wp\/2015\/01\/22\/the-sudden-rise-of-the-avocado-americas-new-favorite-fruit\/<\/a>, accessed November 2016.<\/p>\n

2 <\/sup>Adam Chandler, \u201cThe Return of the Avocado as a Luxury,\u201d The Atlantic,<\/em> http:\/\/www.theatlantic.com\/business\/archive\/2016\/10\/avocado-shortage-price-hike\/504383\/<\/a>, accessed November 2016.<\/p>\n

3 <\/sup>Adam Sternbergh, \u201cHave You Eaten Your Last Avocado?,\u201d Slate,<\/em> http:\/\/www.slate.com\/blogs\/browbeat\/2015\/04\/23\/avocado_shortage_is_the_end_of_avocados_nigh.html<\/a>, accessed November 2016.<\/p>\n

4 <\/sup>Adam Chandler, \u201cThe Return of the Avocado as a Luxury,\u201d The Atlantic,<\/em> http:\/\/www.theatlantic.com\/business\/archive\/2016\/10\/avocado-shortage-price-hike\/504383\/<\/a>, accessed November 2016.<\/p>\n

5 <\/sup>Adam Sternbergh, \u201cHave You Eaten Your Last Avocado?\u201d, Slate,<\/em> http:\/\/www.slate.com\/blogs\/browbeat\/2015\/04\/23\/avocado_shortage_is_the_end_of_avocados_nigh.html<\/a>, accessed November 2016.<\/p>\n

6 <\/sup>Natasha Geiling, \u201cCalifornia Heat Wave Spells Doom For Avocados,\u201d Think Progress<\/em>, https:\/\/thinkprogress.org\/california-heat-wave-spells-doom-for-avocados-b4ed25c95088#.edjpadu4s<\/a>, accessed November 2016.<\/p>\n

7 <\/sup>Tiffany Hsu, \u201cCalm down: The Great Chipotle Guacamole Scare is a non-issue. Right?,\u201d Los Angeles Times,<\/em> http:\/\/articles.latimes.com\/2014\/mar\/05\/business\/la-fi-mo-chipotle-guacamole-climate-change-20140305<\/a>, accessed November 2016.<\/p>\n

8 <\/sup>Justin Harkey, \u201cThe Forecast Restaurants Need to Know About Climate Change,\u201d Modern Restaurant Management<\/em>, http:\/\/www.modernrestaurantmanagement.com\/the-forecast-restaurants-need-to-know-about-climate-change\/<\/a>, accessed November 2016.<\/p>\n

9 <\/sup>Chipotle, \u201cUsing Less Energy For a Brighter Future,\u201d Chipotle website, \u00a0https:\/\/chipotle.com\/energy<\/a>, accessed November 2016.<\/p>\n

10 <\/sup>Allison Miller, \u201cHow Zero Foodprint helps restaurants fight climate change,\u201d Delicious Living<\/em>, http:\/\/deliciousliving.com\/blog\/how-zero-foodprint-helps-restaurants-fight-climate-change<\/a>, accessed November 2016.<\/p>\n

11 <\/sup>Adam Sternbergh, \u201cHave You Eaten Your Last Avocado?,\u201d Slate,<\/em> http:\/\/www.slate.com\/blogs\/browbeat\/2015\/04\/23\/avocado_shortage_is_the_end_of_avocados_nigh.html<\/a>, accessed November 2016.<\/p>\n

12 <\/sup>Justin Harkey, \u201cThe Forecast Restaurants Need to Know About Climate Change,\u201d Modern Restaurant Management<\/em>, http:\/\/www.modernrestaurantmanagement.com\/the-forecast-restaurants-need-to-know-about-climate-change\/<\/a>, accessed November 2016.<\/p>\n","protected":false},"excerpt":{"rendered":"

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