Will SPC’s Chipotle business in Korea succeed?

A person walks by a Chipotle store in New York City, Feb. 7, 2022. Reuters-Yonhap

Korean food conglomerate SPC has established a new joint venture with Chipotle Mexican Grill to open the American casual restaurant chain here, according to SPC Thursday.

Fans who enjoyed the brand’s Mexican-inspired menu outside of Korea are excited about the news. Questions yet remain over whether SPC can manage the operation well enough to sustain the brand’s long-term success in Korea’s competitive and fast-changing dining scene.

Big Bite Company, an SPC unit which operates burger chain Shake Shack here, and Chipotle Mexican Grill signed a deal in July to establish S&C Restaurants Holdings. SPC Vice President Hur Hee-soo and Chipotle CEO Scott Boatwright signed the deal.

Under the deal, Big Bite Company has exclusive rights to operate Chipotle in Korea and Singapore. The first Chipotle restaurant is scheduled to open in Seoul and Singapore next year.

“Given the familiarity of this iconic brand among Koreans and Singaporeans, and their passion for exceptional culinary experiences, these two markets are ideal entry points for Chipotle in Asia,” said Hur.

He added, “In addition, we have a proven track record of developing global brands, and we see an opportunity for leveraging our market expertise to introduce Chipotle’s delicious, responsibly sourced food to guests across the continent who aren’t yet familiar with the concept’s real ingredients prepared fresh daily.”

Boatwright said following the signing of the deal, “With a rapidly evolving dining-out business, fueled by preferences for variety and convenience, expanding into Asia presents an incredible growth opportunity for Chipotle. Real food prepared fast is in high demand in these markets, and with notable brand awareness among consumers, we see potential for strong adoption out of the gate.”

In this July photo, SPC Vice President Hur Hee-soo, left, and Chipotle Mexican Grill CEO Scott Boatwright sign a deal to establish S&C Restaurants Holdings at the American firm's headquarters in Newport Beach, Ca. Courtesy of SPC

SPC said that with the operation rights for Chipotle, Big Bite Company will diversify its business portfolio and bolster global market expansion. Big Bite Company currently runs 32 Shake Shack restaurants here and 14 outside Korea. It also runs 33 stores of global beverage brand Jamba Juice here, recently going through rebranding.

There are 3,770 Chipotle restaurants across the United States, located in all states except Alaska and Hawaii. Outside the U.S., Canada as of this year has 58 Chipotle restaurants. The brand has also expanded to the United Kingdom, France, Germany, Kuwait and the United Arab Emirates in smaller numbers.

Chipotle’s possible debut in Korea has drawn mixed responses.

Some welcomed the news, saying they can finally taste the brand whose menu options include burritos, quesadillas, tacos and other Mexican-inspired dishes. Those who have tasted the brand outside Korea are particularly excited about the news.

Market watchers expect Chipotle to enjoy a surge of popularity upon its debut in Korea, much like Shake Shack did when SPC first introduced the burger brand into the market in 2016. However, they added, it remains to be seen whether Chipotle can stay sustainable after the initial hype fades, stressing that pricing would be the key to determine its longevity.

SPC has opened in Korea global food and beverage brands including Shake Shack, Eggslut, Baskin Robbins and Dunkin’ from the United States, Lina’s from France and Caffe Pascucci from Italy.

Chipotle burrito bowl, burrito and sides / Screen capture from Uber Eats

Not all of them have been profitable. According to the earnings report of Shake Shack operator Big Bite Company, its sales reached 106.5 billion won ($77 million) last year, up from 8.9 billion won a year earlier, but swung to an operating loss of 1.9 billion won from 318.9 million won during the same period.

Shake Shack restaurants here are concentrated in Seoul and the surrounding metropolitan area. With most outlets clustered in high-traffic, high-spending districts, critics say the brand has lost some of its premium image and sense of exclusivity, despite the burgers’ higher prices.

The situation is similar for other SPC brands. Eggslut closed its Korean operation in 2024 after opening its first store in 2020, after facing criticism over its pricing.

Dunkin’ and Baskin Robbins, long established in the Korean market, have also lost their sense of exclusivity as they became some of the most common franchise outlets in the country. Dunkin’ posted its first operating loss in 2023 and has remained in the red since, while Baskin Robbins also began losing money that year.

Growing consumer complaints over Chipotle’s U.S. operations are another source of concern. According to U.S. news reports, in December 2024 the chain raised its prices by an average of 2 percent nationwide to cope with inflation and rising raw material costs, but faced backlash from customers who said portions had shrunk and the meals were no longer worth it.

"Achieving sustainable success will depend on how well the brand strikes a balance between price and value and delivers fulfilling experiences to consumers," an industry official said. "If Chipotle simply replicates its U.S. model, its popularity may be limited to initial hype, making it difficult to establish differentiated status in the Korean market."