Did you get any access to measure how the openings were performing and how the assumptions were aligning with the targets in financial planning, especially regarding ROI and cannibalization?

Yes. When we looked at the results, the cannibalization of other stores was minimized. The sales projections were ambitious. The numbers given for new store openings were more optimistic than the actual results. In about 70% of the openings, the actual results underperformed compared to the forecasted numbers. The cannibalization was often higher than expected. From my experience, the only factor that significantly impacts an existing Chipotle is another Chipotle nearby. No competitors have the same effect.

Following that explanation, how do you see the current decline in same-store sales being related to the new openings they are undertaking?

I don't think the impact is that significant, the openings aren't affecting sales that much. I think a lot of the performance they currently have is due to comparing stronger sales coming off very strong years. Some of the limited-time offers (LTOs) they have are losing steam. When the LTOs first rolled out, they brought out limited-time offerings like certain proteins. I think a lot of that is losing the steam and sales lift it originally brought. For example, when we first rolled out Carne Asada, we saw a 300 to 400 basis points increase in comp due to transaction growth. However, these LTOs from 3 or 4 years ago are no longer providing the same transaction lift. I don't think the number of openings is impacting them significantly. They have over 4,000 stores right now, so I think the issue is more about transaction declines.