Sunday, February 5, 2006

Say what?

Companies issue press releases for all kinds of reasons, but rarely to gush about a competitor. Yet consider the love note Creative Eateries, parent of the fledgling Kokopelli fast-casual chain, put on the wires Friday about the 500-pound gorilla of its intended market, 489-unit Chipotle. The rival brand’s initial stock offering was a “triumph,” with shares doubling in value on the first day of trading, making it the “second-best opening day for a restaurant chain,” crowed Creative. It pointed out that Chipotle’s natural menu was clearly “rousing” for investors, as was the McDonald’s-controlled business’ rapid expansion rate.

Why risk lip chapping with a kiss-up of that scale? It’s clearly an embodiment of that old adage, If you can’t beat ‘em, assert you’re a twin. “Tremendous similarities exist between the Chipotle and Kokopelli concepts, not only in the types of foods and focus on all-natural ingredients, but in the business models themselves,” Creative CEO Frank Holdraker is quoted in the release as observing.

Elsewhere, Creative asserts, “Chipotle’s IPO success calls attention to the comparable marketing opportunity for other, similar concepts.” Okay, we get it.

It should also be pointed out that Kokopelli plans to franchise, while Chipotle doesn’t.

One way the two concepts are not familiar is in size. Chipotle is about to hit the 500-store mark. Kokopelli has three units open, with another 58 in development. That leaves lots of territory open to Kokopelli. But if it’s similar to Chipotle, and the latter brand operates in a market earmarked for Kokopelli development—well, that raises a question, doesn’t it?

Two days before Creative issued the release about Chipotle, one of its investors, Franchise Capital Corp., issued a statement noting that it had amended some agreements with the restaurant concern. Among other things, FCC said, “Creative Eateries has agreed they will seek Franchise Capital's approval on all future press releases regarding Kokopelli Sonoran Grill and Comstock Jake's,” a sister concept.

You can kind of see FCC’s point.

1 Comments:

Anonymous Andrew said...

Well, i have never heard of Kokopelli before so I went to their website and compared it to Chipotle. If Kokopelli's stores, food, or business model are as crapy as their webites I don't think that they have a chance to even think about competing with Chipotle. Chipotle is a incrediably well positioned brand backed by big money (look at their 2billion market cap) Chipotle has nothing to worry about in my opinion.

July 12, 2006 at 7:47 PM  

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