Chipotle’s Fuzzy Math: Why They Stopped Rounding Customers Out of Change

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Lucy Nicholson / Reuters

The next time you’re in Chipotle, check your receipt. That’s what one guy in New Jersey did, and he discovered that the fast-casual restaurant was rounding up to the nearest nickel — and it was costing him money.

Jayson Greenberg of West Caldwell, N.J., noticed something funny on his Chipotle receipts recently. The numbers just weren’t adding up. One receipt showed several items adding to $35.24, but the “total” came up as $35.25. It happened again with another purchase that was $9.24 but was totaled $9.25, and another that was rounded from $18.99 to $19.00. So Greenberg contacted a Chipotle manager.

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“He said, ‘Oh, it’s a computer program. It is just rounding numbers. It takes a little from certain receipts and gives a little to others. What do you want? A few pennies?’” Greenberg told The Star-Ledger.

It turns out, Chipotle was rounding totals — both up and down depending on the price — in high traffic restaurants in New Jersey, New York, locations in Boston and elsewhere. The rationale: counting pennies takes time, and in restaurants that often have people lined up out the door, why not just round to speed the line along?

There is actually research on this very issue. MIT physicist Jeff Gore has become a de facto spokesperson for getting rid of the U.S. penny, not just because it’s lost so much value over the years, but because it actually wastes everyone’s time in line. About a decade ago, Gore estimated that we waste $5 billion a year just fiddling around with pennies to make change at a cash register. While Chipotle’s reasoning was a bit different, it appears they believed they could get more people in the door if they could decrease time at the register.

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Since The Star-Ledger investigated Chipotle’s penny-pinching, the restaurant now says that the restaurants that do round will only do so to the nearest nickel rather than rounding up. Greenberg told The Star-Ledger that after he complained to Chipotle, he returned to the restaurant and discovered a new line on his receipt: “Round -0.02.” His bill should’ve been $19.02, but he only paid $19.00. Similar receipts have shown up on Consumerist.

Chipotle’s “hidden fees” bring to mind Starbucks’ shadowy “bean fee” that was disclosed last year after a Massachusetts consumer affairs bureau fined Starbucks for secretly adding $1.50 to an order of beans that weighed less than a pound.

(MORE: Canada’s Penny Is No More — Is the U.S. Penny Next?)

But if Chipotle decides to round at all of its restaurants nationwide, it could make the idea of rounding to the nearest nickel more acceptable to Americans, something that has been talked about in the ongoing debate over whether we should keep the wildly out-of-whack U.S. penny, which costs more than 2 cents for the U.S. government to make. Our neighbors in Canada will take their penny out of circulation next year, meaning every Canadian business will basically be doing what Chipotle is doing — rounding to the nickel.

27 comments
DarlaRadcliffe-Pokorski
DarlaRadcliffe-Pokorski

LOVE CHIPOTLE! I agree with them, round to the nearest nickle please.  Kids don't even pick up pennies from the ground these days.

CarolynSparkles
CarolynSparkles

I don't care if Chipotle wants to give me 2 cents one day and take 2 cents the next day. Get over it. Chipotle is delicious. 

dectra
dectra

Theft is Theft.  No matter if you 'don't like pennies' or not.

Scratch this restaurant off my list.....

Shiba Fussa
Shiba Fussa

Military has been doing it for many many years overseas w/o a problem, why can't the rest of the country accept it - it pretty much evens out over time.

Alister_Troup
Alister_Troup

I can see .99 becoming .95 as,  say it was 19.99 and you paid with 20.00 the cashier has to open the till to get the 0.01  but it it's 20.00 and you give a 20.00 then the cashier can forget to put the 20 in the till and void the transaction. The cashier on minimum wage only needs to do this once to make 3 hours of extra pay (after taxes). 

Charles Ranier
Charles Ranier

Rounding off pennies? But but but that was the plot of Superman III! With Richard Pryor! You know something's evil if Superman gets involved in stopping it.

Chipotle is just one penny rounding receipt away from getting a smackdown from the Man of Steel, just sayin.

Godzilla1960
Godzilla1960

The penny cost 2.41 cents to produce. Each nickle costs 11.18 cents to make. The total loss to taxpayers between 2006 and 2011 for these two coins was nearly $360 million.

Why do we still make coins that are less than worthless?

Godzilla1960
Godzilla1960

It cost 2.41 cents to produce the penny and 11.18 cents to make each nickle.  That is a total loss, between 2006 and 2011 of $359.80 million.

It is time to eliminate these outdated coins.

Godzilla1960
Godzilla1960

It is time to get rid of the penny.  The nickle, too.  It costs 2.41 cents to make every penny and 11.18 cents to make a nickle.  

From 2006 to 2011 pennies and nickles generated a loss of $359.80 million dollars.

That is money we the taxpayer forked out for these anachronistic coins.

tzedekh
tzedekh

Here's a thought: They should always round down. Yeah, they'll maybe lose a few cents per sale, but no one will feel screwed (if only on principle), except maybe Chipotle. If they want to move the line faster to increase sales, they should pay the price (up to a few cents) per sale. They shouldn't ask customers to understand why rounding was necessary.

Sharon Elder Wooten
Sharon Elder Wooten

Rounding both up and down as appropriate and fair - but the practice should be disclosed.  if the "computer program" automatically calculates this then it should also also automatically disclose it.

Thomas Osypowicz
Thomas Osypowicz

This is silly.

If the company wants to save time on counting change, all they have to do is round their prices, and dispense with the ubiquitous .99 cents.

NENative2010
NENative2010

How is this different from the wireless carriers rounding your talk time UP to the nearest minute? Same thing! If Chipotle is wrong, then so are the telecoms.

lokiii
lokiii

They better be careful.  Insurance companies got sued and lost for similar gimmicks.

tyranna
tyranna

@Alister_Troup Really? What a sad world you live in. 

OmarIrizarry
OmarIrizarry

@Godzilla1960but how much does it take to make a quarter? 20 cents?... 25 cents?..is it more than its value? well it turns out that it is only 11 cents.. So you can see how this balances.. the quarter cost almost half of it value, while the penny cost almost twice its value

Adnan7631
Adnan7631

The problem with that? Tax. Those 2 cents add up. 

Will
Will

 Just getting rid of ".99 cents" wouldn't do anything. If something was exactly $1, it wouldn't be so after sales tax.

What they need to do is work the sales tax into the prices, then make them all even. That way, every order would come out to an even #.

Honestly though, its absolutely insane to cry about them rounding up 2 cents. Rounding to the nearest 5 means it can never be more than 2. Not to mention you get the rounds in your favor just as often. It's such a silly thing to complain about.

If I was a Chipotle customer, I'd care more about their god awful food than some rounding BS.

tzedekh
tzedekh

I personally think the wireless carriers are wrong. You should be metered by the second (I'm OK with rounding up to the nearest whole second).

Steve
Steve

 who actually pays by the minute any more?

tzedekh
tzedekh

Too bad. If the only reason they round is to move the line faster and increase sales, they should be willing to eat the cost. Let's say you're a creature of habit and always buy the same meal, and you lose 2 cents every time, while in theory someone may be benefiting from your loss (it's just as likely as not that Chipotle is). Why should you have to do so in order for Chipotle to ring up more sales? The other option, as suggested by other posters, is to factor the tax into the price.

BrianWilkins29
BrianWilkins29

Idiot.. you have your prices with sales tax included. It's a well known way of dispensing with the foolishness.

tzedekh
tzedekh

"Not to mention you get the rounds in your favor just as often." Not necessarily. If you always buy the same thing, the rounding should be the same (that is, until the price or the sales tax percentage changes).

Desiree Arriola
Desiree Arriola

Or we could be like the rest of the world that has the sales tax already embedded in a rounded off price. For example, when a price says ₩5,000 in Korea, you just pay that much in the end because the tax is already there. Same goes for some European prices. That way, we're not calculating how much we got, then realizing we're a few cents or dollars short because of tax.

dectra
dectra

Agreed.

2 cents on a dollar?

Sound's like the 2% you could be earning on that dollar.

tzedekh
tzedekh

I disagree. Their goal is to increase profits, period. Improving the consumer experience is only a means to an end and, in this case, merely a feel-good by-product of moving units faster. I still say that they should take the per-sale hit and make up for it in more sales. Besides, how do I necessarily benefit from it in time value? Instead of ten people in line in front of me, because of the increased volume there might be more, each of whom moves through a little faster. The net effect could very well be zero saved time.

Robert Mccall
Robert Mccall

You should recognize that it is to your benefit as a consumer that the seller/provider does this in the exchange process. Because you are benefiting in time value. The amount of time you have spent and the associated aggravation is worth value to you as a consumer. It makes for a good deal...you get the food you want, time savings, and less aggravation/more positive experience. Not to mention the issue of having to figure out what to do with the pennies which are not worth the time you spend even thinking about them let alone doing whatever it is you do with them.