Chipotle’s Woes Reportedly Leading To Layoffs At Suppliers

Chipotle’s recent foodborne illness issues — a six-state e.coli contamination that sickened more than 50 people and a norvirus outbreak that left more than 150 customers ill in Boston — haven’t just caused problems for the fast casual restaurant in terms of slumping sales and dropping stock prices, it’s also reportedly trickled down the chain to the company’s suppliers in the form of layoffs. 

The Bangor Daily News reports that the Maine-based manufacturing company in charge of making Chipotle’s paper burrito bowls recently laid off up to 30 employees because of decreased demand at the restaurants.

Consumers’ apparent reluctance to eat at Chipotle during its ongoing foodborne illness outbreaks led to burrito bowls piling up, a spokesperson for Huhtamaki said, which in turn created less need for the production of new products.

The layoffs, which are expected to be temporary, took place after the holidays.

“Obviously, Chipotle has lost some of its patronage and we think it’s a temporary thing,” Duane Lugdon, union representative for United Steelworkers, tells the Bangor Daily News. “We don’t see this lasting longer than perhaps four to six weeks — eight weeks at the most — and the folks will be recalled to begin making the Chipotle products again.”

Lugdon said that the layoffs weren’t exactly a surprise to Huhtamaki workers, as they knew cuts were on the way with the company’s inventory of Chipotle products began to build up.

“It’s a devastating thing, but this is really not a permanent thing,” he said.

Chipotle has been working in recent weeks to turn around slumping sales, while also reassuring customers that its restaurants are a safe place to eat by implementing new food handling standards.

Maine manufacturer cuts jobs tied to Chipotle food poisoning [Bangor Daily News]