1. Justified: Chipotle is a for-profit business and passing on increased labor costs to customers can help them maintain profitability.
2. Fairness: Customers benefit from the services and convenience provided by Chipotle, and they should share in the costs associated with providing fair wages to employees.
3. Paying a living wage: Passing on the increased labor costs can help Chipotle ensure that their employees earn a decent living wage, which promotes fairness and social responsibility.
4. Transparency: Adjusting menu prices allows for clear communication of the impact of rising labor costs to customers.
1. Unfair burden on customers: Customers may feel that the increased prices unfairly shift the burden of labor costs onto them, especially if they are already facing financial constraints.
2. Profit concerns: Chipotle is a large corporation with substantial profits, and customers may argue that they should absorb the increased labor costs without passing them on.
3. Competitive disadvantage: If Chipotle raises prices due to labor costs while other competitors do not, it may put them at a disadvantage by potentially driving customers away.
4. Consumer perception: Some customers may perceive the price adjustment negatively and associate it with greed or lack of corporate social responsibility.
Chipotle recently adjusted its menu prices due to food inflation, however, they still need to make revisions to accommodate rising labor costs. Read more…