Panera Bread Company Case * Student: -Miguel Etchebarne Question 1 What is Panera Bread’s strategy? Which of the five generic competitive strategies discussed in Chapter 5 most closely fit the competitive approach that Panera Bread is taking? What type of competitive advantage is Panera Bread trying to achieve? -Panera strategy was to make great bread broadly available to consumers across the United States. They have an attractive menu and the dinning ambience of his bakery-cafes provided significant growth opportunity, despite the fiercely competitive nature of the restaurant industry.
Also was recognized as the nationwide leader in the specialty bread segment and scored the highest level of customer loyalty among quick-casual restaurant. -The generic competitive strategy used by Panera is the best-cost provider. Why? First, we are going to explain this strategy. The best-cost provider strategy give customers more value for the money by satisfying buyers’ expectations on key qualities, features, performance and service attributes while beating their price expectations. The aim is to have the lowest (best) costs and prices compared to rivals offering products with comparable differentiating attributes.
The driving concept of Panera was to provide a premium specialty bakery and cafe experience to urban workers and suburban dwellers. Panera target market was urban workers and suburban dwellers looking for a quick-service meal. They compete in 5 submarkets of the food away from home industry: breakfast, lunch, daytime “chill out”, light evening fare and take home bread. The company growth strategy was to capitalize on Panera? s market potential by opening both company-owned and franchised Panera bread locations as fast as was prudent. The competitive advantage of Panera was their dough facilities, scale economies (franchise system) and the software. Question 2 What does a SWOT analysis of Panera Bread reveal about the overall attractiveness of its situation? Does the company have any core competencies or distinctive competencies? Swot Analysis: Strengths -Franchise system -costumers loyalty -Nationwide leader in specialty bread segment -quick service system -bread expertise -success in the five submarkets of the food-away-from-home industry -fresh dough operations Weaknesses -Regional located, a lot of undercover places like big cities -Week dinner menu The name it’s not a top of mind name like Starbucks Opportunities -They have a growth opportunity -They can offer organic food too, opening a new target -Expand their company out of the US -Put franchise in big cities Threats -Rivals imitate Panera menu -Competition of other restaurants chains became more intense -Saturate the market with outlets Conclusions: Panera has been growing very fast, they have clear goals and they are looking the opportunities and using them, but they have a lot of competitors and the industry change permanently, so they have to be prepared for the future demand of different products.
Besides Panera it’s not the Top of Mind organization in the industry so they have to go for it and be an important part of the competence, expanding their franchise to the big cities or to other countries. The good part of this organization it’s the growing expectations and the chances to get an even better future than the actual. Core Competence: -The baking process Distinctive competence: -Software difficult to copy -The dough Question 3 What is your appraisal of Panera Bread’s financial performance based on the data in case Exhibits 1, 2 and 8? How well is the company doing financially?
Use the financial ratios in Table 4. 1 of Chapter 4 as a guide in doing the calculations needed to arrive at an analysis-based answer to your assessment of Panera’s recent financial performance. -The company increases the revenues year after year, but sometimes the costs increases to. Based on the numbers of the tables, Panera its going well financially, whit net profits higher every year, but not that much. Question 4 Based on the information in case exhibit 9, which rival restaurant chains appear to be Panera? s closest rivals? -Atlanta Bread company -Bruegger? s -Au Bon Pain Cracker Barrel -McAlister? s Dell The first three companies are directly competing with Panera, because they are Bakery-cafes, the difference between them are revenues and number of company-owned and franchise. The last two compete but in a small way, because they are not in the same industry, they are like substitutes of Panera Bread company. Question 5 What strategic issues and problems does Panera Bread management need to address? -A problem that Panera have is the low penetration in the big cities, so management need to do strategic moves to expand to does areas. -Another thing it? to add more dinner food, because the menu its very poor for that time. -They maybe can try to go to another countries like some of their competitors (Applebee? s, Au bon Pain, etc. ) Question 6 What does Panera Bread need to do to strengthen its competitive position and business prospects vis-a-vis other restaurant chain rivals? -Panera it? s on a god way -They need to find some places where they need them, some new places. -Always control the expenses -Develop new products constantly -Try to be a Top of mind brand -And in the last place but the most important, never lost the north of their vision, because it’s good.
