Few companies can match Chipotle Mexican Grill’s avocado appetite. The California-based restaurant chain bought around 5% of all the avocados consumed in the U.S. last year. Since domestic production is limited, most of the roughly 132 million pounds of avocados Chipotle used across its 3,700 locations last year were imported.
Many guacamole lovers flinched when the U.S. threatened a trade fight with Mexico, which accounts for roughly 90% ($3.4 billion worth) of U.S. avocado imports. But Chipotle was ready. For the past 7 years, the chain has been scouring the Americas and the Caribbean, seeking out farms and suppliers that can satisfy its immense demand. In the past, Mexico had supplied 85% of Chipotle’s avocados, leaving the chain at the mercy of the country’s weather and other factors, such as cross-border trade, reports The Wall Street Journal (April 1, 2025).
Food-industry supply chains can take years to build. Many companies are deciding whether to redraw trade lines to avoid the levies, absorb rising costs or pass them along to customers. Chipotle’s globe-spanning hunt for avocados reflects how firms navigate rapid changes in trade policies. It expanded its supply-chain team, directing the group to find new avocado sources. The team identified half a dozen countries, concentrated in locales near the equator, that could support the sun-hungry plants.
So Chipotle broadened its avocado sourcing to Columbia, Peru, the Dominican Republic, Brazil and Guatemala–and plans to develop new suppliers in El Salvador and Honduras. But diversifying avocado sources creates challenges in Chipotle’s kitchens, too. Chipotle has given restaurant crews leeway to add more lime or lemon juice and salt, depending on the results of guacamole taste tests.
Even with a more dispersed supply chain, about half of Chipotle’s avocados still come from Mexico. It is supporting research on ways to cultivate more avocados in the U.S., including in Florida, where I live. (We have 3 avocado trees in our yard and have such a crop that we give it to all our neighbors). Company executives said they will continue to scour the world to find more readily available sources to protect its guacamole stocks.
Classroom discussion questions:
- Why is Chipotle expanding its supply chain?
- What are the operations management complications of sourcing from so many different countries?