1. I believe Panera Bread uses a focused differentiation strategy. It uses this strategy by offering meals that are healthier options than those of traditional fast food. It focuses in on a market of urban workers and suburban dwellers. Panera offers a variety of above average fast food which include: bakery items, classic/signature sandwiches, and soups to meet the needs and wants of all their customers. They also offer a nicer restaurant setting they eating at a typical fast food restaurant like McDonalds or Burger King. Panera wants to give its target market a healthier, affordable, and more stylish/modern environment for them to relax and enjoy their food in.
2. Strengths:
• Panera Bread is known for being popular all over the united
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• On the other hand, you can also say the threat to new entrants is low because of the astronomical price of opening a restaurant.
Threat of Substitute Products:
• This is very high because there are a number of different restaurants in the industry to pick from
Rivalry:
• A lot of rivalry amongst different companies in the industry, mainly because standing out is such a big part of the industry and drawing customers to your restaurants. This cause a situation where everyone constantly tries to one up each other to appeal to the eye of as many customers as possible.
• Biggest competition: o Starbucks o Chili’s o Applebee’s
4. We can see from exhibit 1, Panera Bread has enjoyed steady growth from 2011-2015. I think if they continue what they are currently doing, they growth will continue to increase and they will be a major player to be looked at in the chain restaurant game.
• Gross Profit Margin 0.73345
• Operating Profit Margin
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's mark item is new prepared artisan bread made with restricted fixings and no additives or chemicals. The menu gatherings were new prepared products, made-to-request sandwiches and plates of mixed greens, soups, light dishes, and bistro drinks. They also effectively competed in five submarkets of the nourishment far from home industry. Panera Bread uses its particular menu, signature bistro configuration, welcoming atmosphere, working frameworks, and unit area system to contend effectively. The submarkets that Panera contends in are breakfast, lunch, daytime, light night admission for take-out or eat in, and bring home bread. Panera's objective was to build feasting at different supper times: breakfast, lunch, daytime, and supper. Panera also improved their menu by keeping in mind their end goal to end up distinctly a broadly perceived brand name and to be the predominant eatery as well as a claim to fame while being a specialty bread shop. The menu improvements concentrated on pulling in clients amid the night feast hours and client
The driving concept behind Panera Bread is to provide a premium specialty bakery and café experience to urban workers and suburban dwellers. Panera can compete at a high level in the quick food industry because of what they offer customers better than their
Panera has three business segments: Company-owned bakery-café, franchise operations and fresh dough operations. The company’s growth strategy was “to grow their store profits, to increase transactions and gross profits per transaction, use capital wisely and put into place drivers for concept differentiations and competitive advantage” (Vincelette & Fogarty, 2010, p7.). In 2009 while everyone else was experiencing the hard economic times Panera Bread was sticking to their strategic plan. Panera did not lay off employees, or worry about closing underperforming stores. Instead, they continued to add menu items and even increased prices on existing items. This strategy worked for them and they were able to take advantage of clientele that came from fine dining. The company has
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
Panera’s Competitive strategy is based on differentiation and value as they provide their customers with a wide variety of products on different times of the day meanwhile they want their customers visiting Panera as being a good value.
A key aspect of Panera Bread’s business that protects the company from direct competition in the fast food industry is their product niche, artisan fast food. Fast food chains are often criticized for offering unhealthy foods. But, Panera Bread focuses on a higher nutritional value in their products. Dine in restaurants are very susceptible to drops in consumer spending, so Panera Bread’s
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 eating the establishment, you will spend around an average of $8.50 for lunch, which isn’t far off from their competitors in the fast food market. Simple things like listening to your customers will and can go a long way. To further their connection with their customer they took a survey that showed that 82% of consumers would prefer freshly cooked eggs in their breakfast sandwiches and Panera took the initiative to give the people what they wanted. “’To compete in this business, we believe we need to have offerings that are worth getting out of your car for,’ said Panera’s Chief Concept Officer, Scott Davis” (Wheelen pg.32-14). This type of mentality will concert people into loyal customers, and once a customer is loyal to your company you have them for
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
The strategy selection for Panera Bread would be a focused (or market niche) strategy based on differentiation. This strategy was selected for the following reasons:
As a result, Panera’s “fast casual” niche (between casual dining and fast food) contributes to its relative success; this positioning allowed it to avoid discounting wars and maintain its margins by attracting customers with a higher quality product perceived to be a good value for the money.
Panera Bread is considered to be one of the U.S. most successful fast-casual restaurants. The company is one of the revolution makers in the industry of fast food, which managed to transform the traditional image and perception of to-go products that are available at an acceptable price on the market. As its initial founding company was established in 1981, Panera Bread managed to gain up to 4.5 billion USD in sales by the year of 2015, whereas the average sales per one store made up to 2.5 million USD annually (Thompson). Nevertheless, the company that once managed to upgrade bread and pastry into a trend of fast and healthy eating, today is struggling with massive competition on the fast food market. Its previous strategic strengths now became a burden that stops innovation and creativity and does not
The generic competitive strategy that Panera best fits is broad differentiation. This is primarily because Panera sought to be the first choice for patrons looking for fresh-baked goods, a sandwich, soup, a salad or a beverage in a pleasing environment. In this platform Panera has set their eyes on people who may not necessarily be looking for an expensive meal, but might also not want cheap, fast food but instead are looking for a fresh meal that can be enjoyed in a relaxing environment. In this Panera is looking for a