Panera Bread Case Study
Synopsis
Panera Bread Company began in 1981 as Au Bon Pain Co. founded by Louis Kane and Ron Shaich . Ron Shaich befriended cofounder Louis Kane in 1980, shortly after opening the Cookie Jar bakery in Cambridge, Massachusetts. Kane, a venture capitalist, had recently purchased the Au Bon Pain Company in 1978. Shaich was interested in “adding bread and croissants to his menu to stimulate morning sales” . Shaich recalled, “50,000 people a day were going past my store, and I had nothing to sell them in the morning” . It was soon thereafter that the two decided to merge Au Bon Pain and the cookie store to form Au Bon Pain Co. Inc. Both individuals formed a synergistic relationship that only helped the company grow into an overwhelming success. “Shaich was the hard driving, analytical strategist focused on operations, and Kane was the seasoned businessperson with a wealth of real estate and finance connections” . “In 1985, the partners added sandwiches to bolster daytime sales as they noticed a pattern in customer behavior” . What the two realized is that their customers were buying Au Bon Pain’s bread and using their own cold cuts to make sandwiches their self. This realization was the launching point for the industry’s first ‘fast casual restaurant’.
By 1991 the company had $68 million in sales and became a leader in the quick service bakery segment. It was at this time that Kane and Shaich took the company public. However, even with their explosive growth the company was modeled upon a limited growth concept. Shaich called this concept, “high density urban feeding” . The company’s main customers were office workers who lived in highly dense metro areas such as New York, Boston, and Washington DC. As the text states, “this strategic factor limited expansion possibilities” . Looking to capitalize on the ‘suburban marketplace’ Au Bon Pain acquired the Saint Louis Bread Company in 1993. This acquisition would be the springboard for what is now
Panera Bread Company began in 1981 as Au Bon Pain Co. founded by Louis Kane and Ron Shaich . Ron Shaich befriended cofounder Louis Kane in 1980, shortly after opening the Cookie Jar bakery in Cambridge, Massachusetts. Kane, a venture capitalist, had recently purchased the Au Bon Pain Company in 1978. Shaich was interested in “adding bread and croissants to his menu to stimulate morning sales” . Shaich recalled, “50,000 people a day were going past my store, and I had nothing to sell them in the morning” . It was soon thereafter that the two decided to merge Au Bon Pain and the cookie store to form Au Bon Pain Co. Inc. Both individuals formed a synergistic relationship that only helped the company grow into an overwhelming success. “Shaich was the hard driving, analytical strategist focused on operations, and Kane was the seasoned businessperson with a wealth of real estate and finance connections” . “In 1985, the partners added sandwiches to bolster daytime sales as they noticed a pattern in customer behavior” . What the two realized is that their customers were buying Au Bon Pain’s bread and using their own cold cuts to make sandwiches their self. This realization was the launching point for the industry’s first ‘fast casual restaurant’.
By 1991 the company had $68 million in sales and became a leader in the quick service bakery segment. It was at this time that Kane and Shaich took the company public. However, even with their explosive growth the company was modeled upon a limited growth concept. Shaich called this concept, “high density urban feeding” . The company’s main customers were office workers who lived in highly dense metro areas such as New York, Boston, and Washington DC. As the text states, “this strategic factor limited expansion possibilities” . Looking to capitalize on the ‘suburban marketplace’ Au Bon Pain acquired the Saint Louis Bread Company in 1993. This acquisition would be the springboard for what is now