The cheesy dish appeared on the menu at the company’s first test kitchen open to the public.

By Beth Kowitt
July 12, 2017 10:59 AM

Natural is not the first descriptor that comes to mind when one thinks of queso—the thick sauce of cheese that’s a perfect pairing with nachos. For one thing, cheese is not meant to remain in such an unspoiled liquid form indefinitely.

“Queso is difficult to make if you’re going to use real ingredients,” says Mark Crumpacker, Chipotle’s chief marketing and developing officer, noting that a lot of queso includes industrial additives and preservatives.

But Chipotle doesn’t use those kinds of additives. The company has made its commitment to “real” ingredients with no added flavors, colors, or preservatives a central tenet of its offering and a point of differentiation compared to other chains. This posed a major challenge for Chipotle, whose customers have asked for queso for two decades, Crumpacker tells Fortune.

But earlier this week Chipotle signaled that it had cracked the code on queso when the item appeared on the menu at Chipotle NEXT Kitchen, the company’s first test kitchen open to the public.

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Crumpacker says the company was able to get queso on the menu by adding only two ingredients—corn starch and tapioca starch—to its previous total list of 51 that is uses in its food. The addition of the two starches enabled the company to prevent the two common queso problems: separation and the formation of a skin.

In addition to the two starches and cheese, the queso is made with hot and medium salsa, picked jalapeno, and sofrito—a blend of herbs and spices.

The NEXT Kitchen is being overseen by a strategy team at Chipotle led by Crumpacker, who says it’s “charged with determining what the future of what Chipotle might be.”

The launch of the NEXT Kitchen comes as Chipotle battles its way out of a highly challenged period for the company, which began in 2015 with a string of food safety crises. Last year revenue fell 13% and profits plunge 95%.

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After hopeful signs in April with double-digit positive quarterly same store sales, an important industry metric, the company disappointed investors last moth when it said its 2017 figure would be in the high-single digits—below analyst estimates.

In addition to queso, the company is also testing virgin and alcoholic margaritas and a mixed-greens salad with avocado vinaigrette. Its also trying out a spicy chocolate dipping sauce to accompany the sweet chips it rolled out to test markets in May. (Crumpackers says the previous apple sauce led to too much sweetness in combination with the already-sweet chips.)

Even the possibility of new menu items is a departure from Chipotle’s traditional strategy of avoiding the limited-time-offer game that so many rivals play—a move meant to generate news and reignite consumer interest in a brand.

“Since Chipotle was started 24 years ago, not a lot has been added to the menu,” says Crumpacker, pointing to salad, its spiced tofu called sofritas, and chorizo as the few additions. Crumpacker notes that this is a very deliberate choice: “It’s always been [CEO Steve Ells’s] philosophy to do a few things, and do them really well.”

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Crumpacker says that Chipotle’s commitment to using fresh ingredients and traditional cooking methods means that additions to the menu can slow down the experience for customers. That’s why the company isn’t serving chorizo in the NEXT Kitchen—when queso came on, chorizo came off. “It’s deliberate and borne out of necessity,” he adds.

Right now queso is only available at the NEXT Kitchen, located in Manhattan’s Chelsea neighborhood. The combination restaurant-test kitchen is meant to speed up the time to get new products to market. Before opening up this location, Chipotle would test its products through a private kitchen, which required an additional step of proving a new item worked operationally with equipment and crew in stores before rolling it out more broadly.

Crumpacker declined to provide a timeline for when customers might see queso nationally. But it’s likely to be before the new salad, which requires more prep and training for the crew.

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