Panera Bread Company Case Analysis
Panera Bread Company’s Growth Strategy
Case Analysis 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. With 170 stores in the development pipeline in 2007 and several hundred more to reach its goal, Panera Bread Company faces a task many companies have failed at time and time again, resulting in massive debt, contraction and contributing to the flame-out of a once promising brand and stock investment. The decisions surrounding how to expand should be based on analysis and evaluation of the successful operations and financial performance thus far. Specifically, the plausible proposition of growing franchisee-owned stores in contrast to company-owned stores is a driver and key success factor for Panera Bread Company. We discuss these trends and recommend expansion at a sensible pace by encouraging franchisee stores in untapped markets, and continuing the success of product offerings and the focus on quality control through wise supply-chain management. This company thrives on first-time customers and word of mouth to continue its growth. “The company’s marketing research indicated that 57 percent of consumers who have “ever tried” dining at Panera Bread had been customers in the past 30 days” (C-169). Panera Bread has accomplished a distinctive position in the restaurant industry, making it possible to market to a growing customer pool that desire better quality foods. The growth
Case Analysis 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. With 170 stores in the development pipeline in 2007 and several hundred more to reach its goal, Panera Bread Company faces a task many companies have failed at time and time again, resulting in massive debt, contraction and contributing to the flame-out of a once promising brand and stock investment. The decisions surrounding how to expand should be based on analysis and evaluation of the successful operations and financial performance thus far. Specifically, the plausible proposition of growing franchisee-owned stores in contrast to company-owned stores is a driver and key success factor for Panera Bread Company. We discuss these trends and recommend expansion at a sensible pace by encouraging franchisee stores in untapped markets, and continuing the success of product offerings and the focus on quality control through wise supply-chain management. This company thrives on first-time customers and word of mouth to continue its growth. “The company’s marketing research indicated that 57 percent of consumers who have “ever tried” dining at Panera Bread had been customers in the past 30 days” (C-169). Panera Bread has accomplished a distinctive position in the restaurant industry, making it possible to market to a growing customer pool that desire better quality foods. The growth
Cited: Thompson, Arthur A., A.J. Strickland III, and John E. Gamble. Crafting and Executing Strategy. 17th ed. New York: McGraw-Hill/Irwin, 2010.