Panera Case Analysis Austin Howe 10/25/15 In the modern society there are several companies that are synonymous with a type of product. This includes companies such as Mcdonalds being synonymous with fast food and Lamborghini being synonymous with quality cars. However in recent years there have been some newcomers to the industry that have made quite the name for themselves, companies like Chipotle, Panda Express, B-Good, and Panera bread. Panera Bread was founded in 1987 by Kade King, Ken Rosenthal, and Ronald M. Shaich in Kirkwood, Missouri. Panera is defined as a “Fast casual/Bakery-Café, including several varieties of, bread, such as bagels and muffins, cold sandwiches, hot panini, salad, soups, coffee, and teas”(Panera …show more content…
As was already discussed Panera 2.0 plans to bring a point where there is no wait time for your food to be prepared and ready to go. This is one of the main reasons that companies like Starbucks and Dunkin Doughnuts have a competitive edge against companies like Panera. Panera in the last few years has struggled to increase their revenue stream. This issue will likely be solved by expanding into the European and Asian markets. By expanding into the western markets Panera can bring in a much larger clientele and by doing so vastly increase its revenue stream. With many people focusing on personal health in the last few years requests for organic restaurants/Café’s are at an all time high. by adding an organic section to the Panera menu the total increase in revenue would be exponential in comparison to the regular items sold at Panera. This concept also extends to the idea of creating/expanding a gluten free menu for the ever rising amount of gluten allergies that exist. A small thing that Panera could do in order to bring in new clients would be to install a drive through to go section to their stores. By
Panera Bread offers franchising opportunities to facilitate its expansion. The company has a highly selective process and requires franchisees to
The Panera Bread legacy started in 1981 as AuBon Pain Co., Inc. In May of 1999, all of the AuBon Pain Co., Inc.’s business units were sold, except for Panera Bread, thus the company was renamed Panera Bread (Panera). As of December 2015, there are 1,972 bakery-cafes in 46 states, the District of Columbia, and in Ontario Canada (Panera, n.d.). Today, Panera Bread has a market capitalization of $4.5 billion and continues to be on a journey to serve food, as it should be. They continue to strive on serving quality foods that are free of artificial ingredients and making sure customers have a great experience.
Panera, a “fast casual” restaurant is built on the premise of creating a warm and inviting atmosphere for employees and customers alike. Employees abide by a code of conduct that spells out ethical rights and responsibilities on individual and corporate levels and encourages employees to ask questions in person or by way of a dedicated Ethics Hotline. They also have an anti-retaliation policy to protect anyone who reports a potential violation from mistreatment (Panera Bread
Another organizational crisis arose in 1995 when efforts to expand the Saint Louis Bread chain in order to increase brand awareness backfired as consumers favored Saint Louis Bread over its parent company. To solve this conflict, new divisional presidents were created for each chain, and in 1999 Shaich convinced the board of directors to sell all the Au Bon Pain cafes and restructure the Saint Louis Bread chain under the name Panera Bread. Panera’s current organizational structure utilizes vertical integration, with 17 fresh dough facilities that deliver to 1,591 cafes and franchises (“Our History”). Upper level managers now make menu and pricing decisions and overlook the marketing, franchise, concept development, legal, technology, supply chain, and human resource departments (“Organizational Chart”). Lower level
The Panera Bread Company is starting 2007 with unfinished goals and missed targets previously set and a review of their strategy is in order to continue their ongoing success. The company has grown substantially since its inception in the competitive restaurant industry; however, an aggressive target of 2,000 Panera Bread bakery-cafes will require a focused strategic plan. The company has a strong base with loyal customers who appreciate Panera’s unique dining atmosphere with a focus on quality products at a reasonable price. Panera will need to continue its market research and focus on environmental issues, which are an important core value. The opportunity for
Expanding the target market of Panera Bread is a good growth opportunity for them. This can be achieved by product line (menu options) extension or by entering international market outside the American continent so as to increase their geographical coverage. In addition, Panera has an opportunity to get additional market and growth by adapting rapidly to changing market and customer preferences. They need to advertise and market themselves as a healthy option for eating out. Health oriented food or food that are low in calories, sugar, cholesterol, etc. is getting very important as people started becoming very health conscious and selective. Their effort to roll out new products with fresher ingredients such as antibiotic-free chicken needs to be further expanded. Recognizing the health risks associated with transfat, Panera had completely removed all transfat from its menu by 2006. Organic food, non GMO, etc. They could increase number of their franchises. A number of markets were still available for franchise development. The have opportunity in front of them to open more outlets, both company-owned and franchises. They could open within North America and mainly in areas where they are not present now, and those areas where the growth potential is good, like some of the suburban markets. Many good locations for fast casual dining options are available in many of the untapped areas. Panera has a good market opportunity outside the small urban niche where greater growth
Panera Bread has established itself as one of the most popular, fast growing “bakery-café” restaurants in the United States as well as in Canada. With 1,800 locations in 45 states, the franchise appears to be unstoppable. This in part is due to the superior customer service experience that keeps customers coming back time and time again. Just to give you an example, in 2012; the most recent year that data is available, Panera Bread brought in an astounding $2.13 billion in revenue, about $1 billion more than its revenue in 2008.
As mentioned in the case study, Panera Bread Company is known to be one of the leading bakery/café that offers freshly baked pastries and French inspired entrées across various states in the US. However in the recent years, Panera Bread faced a decrease in their usual high growth rate from 9.1% and 12.0% in the year 2000 to merely 0.2% and 0.5% of comparable sales and annualized unit volumes respectively.
The rivalry among competing sellers, often the strongest competitive pressure, is also fairly high for Panera in the restaurant industry. No switching costs, numerous competitors, and an increase in the availability of healthy food
Among the crowded field of casual, quick-service restaurants in America, the distinctive blend of genuine artisan bread and a warm, comfortable atmosphere has given Panera Bread Company a golden opportunity to capture market share and reward shareholders through well-planned growth. With the objective of opening approximately 1,000 more bakery-cafes in the next three years, Panera Bread Company must make prudent strategy decisions about new store locations, supply-chain management and expanded offerings, all the while continuing its above-average earnings per share growth of at least 25 percent per year.
Panera Bread Company got its start when in 1980 Louis Kane and Ronald combined Au Bon Pain and the Cookie Jar bakery to form one company. By combining their individual strengths they were able to work as a team and expand the business, decrease company’s debt and centralize facilities for dough production (Wheelen, Hunger, Hoffman & Bamford, 2015). In 1993 the company acquired the Saint Louis Bread Company. With the three companies now working as one the company eventually became the Panera Bread Company with 1464 bakery cafes in 2010 including one in Ontario, Canada. Today Panera Bread has a board of directors that consists of six members divided into three classes of membership.
Panera Bread’s intention is “to make Panera Bread a nationally recognized brand name and to be the dominant restaurant operator in the specialty bakery-café segment.” Panera experienced competition from many numerous sources in its trade areas. Their competition was with specialty food, casual dining and quick service cafes, bakeries, and restaurant retailers, including national, regional, and locally owned. The competitive factors included location, environment, customer service, price, and quality of products. Panera learned from its competitors, none of its competitors had yet
When examining Panera Bread Company, it possesses several strengths. One of the greatest strengths in providing great bread is the actual menu. Panera prides itself on the commitment to the quality and reliability of its products, which is supported by its focus on creating the menu. With an understanding of customers ' needs Panera has developed an extensive product line to satisfy a variety of tastes. Panera continually adapts the menu in response to seasons and changing customer preferences. For example, it introduced whole grain breads because customers were concerned with consuming good carbohydrates. Each bread product is artisan made in one of the seventeen dough facilities to ensure freshness
Panera Bread has much strength within their business. In the beginning, Panera Bread recognized another company, Saint Louis Bread Company, to aid in strengthening their market standing and competitiveness by purchasing the company. Panera Bread further strengthened their company by redesigning the newly acquired company to have a more appealing dining experience, better quality, customer service, and wider product selection. After redesign was complete, the newly named Panera Bread recognized the new company design has a cash hog and made the wise decision to sell off
Panera Bread started in 1981 as Au Bon Pain Co., Inc. Founded by Louis Kane and Ron Shaich; the company prospered along the east coast of the United States and internationally throughout the 1980s and 1990s and became the dominant operator within the bakery-cafe category. In 1993, Au Bon Pain Co., Inc. purchased Saint Louis Bread Company, a chain of 20 bakery-cafes located in the St. Louis area.