Panera Bread Case
1. What is Panera’s Strategy? Which of the five generic competitive strategies most closely fits the competitive approach that Panera is taking? What type of competitive advantage is Panera trying to achieve?
Panera Bread’s strategy is to provide a premium specialty bakery and café experience to urban workers and suburban dwellers. As well as to create a specialty café anchored by an authentic, fresh-dough artisan bakery and upscale quick-service menu selections. Broad Differentiation is the competitive approach Panera Bread has taken. They compete on the basis of providing an entire dining experience they call “Panera Warmth” .Their environments are distinctive and ...view middle of the document...
Weakness: Less well-known brand name than some rivals, sales at franchised stores run a bit higher than those at company-owned stores, weak dinner menu, not offering any substantial entrees, small percent of profits come from dinnertime sales, low brand awareness in new markets, market saturation in St. Louis area, leased land, off-site dough preparation and delivery.
Opportunities: To expand into new markets, both company-owned and franchised as there is untapped growth potential in a number of suburban markets. Open locations outside the U.S.,
lower and better dinner menu offerings to attract an evening crowd and designing a more attractive policy.
Threats: Rivals begin to imitate some of Panera breads menu & ambience, competition from other restaurant chains in the fast-casual segment or other restaurant categories becomes more intense. Other threats are attractiveness of competitors due to high profit margins and some areas start to shows some degree of market saturation.
After a breakdown of the SWOT analysis it reveals that Panera Bread is still in a real attractive situation where it can make substantial profit and be competitive but has some kinks to still work on to strengthen its competitive advantage and stay in an attractive situation.
3. What is your appraisal of Panera’s financial performance based on the data in Exhibits 1, 2, and 7?
4. Based on information in Exhibit 3, which rival restaurant chains appear to be Panera’s closest rivals?
Panera Bread competes in a very competitive industry surrounded by companies that’s been in the market for years and has a strong presence. In the fast-food industry it competes against well-known companies such as McDonalds, Burger King & Wendy’s. In the fast casual dining industry Panera Breads closest rivals are Chipotle, Au Bon Pain, Chilli’s and Applebee’s.
5. What strategic issues and problems does Panera management need to address?
Panera Bread is a well accomplished young company, but like all companies it has its flaws that need to be addressed. A couple key issues that need to be addressed by management is product costs as they are significantly higher than restaurants in the same market, immature marketing of products, the little to no city and urban area presence as Panera Bread is more focused on neighborhoods,...