Running Head: EXPANSION OF CHIPOTLE MEXICAN GRILL INC.

Expansion of Chipotle Mexican Grill Inc.

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Chipotle Mexican Grill Inc. has been successful with chains in America, Germany, the UK as well as France. This company has been successful in tacos and mission burritos which brings in most sales revenue. As a public traded company in Ney York Security Exchange under the name CMG. Most of the branches are located in the United States and it utilizes 8 functional areas of business for its operations. The company has been successful in the countries where it has expanded in. There is a need to expand in more countries and the most ideal at the moment are the Indian markets and the Japanese Market.

Japanese market

Taking business activities of CMG into Japan market can benefit from high industrialization in the country (Trencher, Taeihagh, & Yarime, 2020). Operating in Japan would be faced with a trade barrier. However, CMG being an American company is likely to face fewer trade barriers because of the trade relationship between Japan and the United States. CMG stands to benefit from doing business without insights from Japanese authorities. Cross stocking would also be possible hence an attractive environment to do business for CMG. Since the Japanese market is a trade partner with other international companies, favorable foreign trade policies are favoring foreign direct investors like CMG. Since Japan has a trade relationship with Asian and Middle East countries, it has good GDP hence a good economy to support the business activities of CMG (Taher, Matsuzaki, & Tsuji, 2020).

Indian Market

Whenever US companies are exporting to India, some tariffs make it quite difficult for US companies to strive there. Even though India has a small FDI (Murshed, Chadni, & Ferdaus, 2020), it has a high population ad this is good for CMG. India is on the rise on the world map in terms of business and hence its income from foreign investments is increasing (Khuntia, & Pattanayak, 2020). While investing in India, it is important to note the country has limited foreign alliances with other countries. Thus, it has small incomes from trade with such countries.

Recommended Mode of Entry

The best mode for entry is to invest in Japan and employ locals. This approach would help CMG to learn about the Japanese culture and observe it in its business operations. In India, the acquisition is better because the market is not yet mature and thus riskier.

REFERENCES:

Khuntia, S., & Pattanayak, J. K. (2020). Evolving efficiency of exchange rate movement: An evidence from Indian foreign exchange market. Global Business Review, 21(4), 956-969.

Murshed, M., Chadni, M. H., & Ferdaus, J. (2020). Does ICT trade facilitate renewable energy transition and environmental sustainability? Evidence from Bangladesh, India, Pakistan, Sri Lanka, Nepal, and Maldives. Energy, Ecology and Environment, 5(6), 470-495.

Taher, S. A., Matsuzaki, T., & Tsuji, M. (2020). REGIONAL INNOVATION SYSTEM IN JAPAN. Editorial Board, 179.

Trencher, G., Taeihagh, A., & Yarime, M. (2020). Overcoming barriers to developing and diffusing fuel-cell vehicles: Governance strategies and experiences in Japan. Energy Policy, 142, 111533.

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