Panera Bread's Strategy

Questions 1,2

1. What is Panera Bread's strategy?

Panera Bread's strategies are, "to provide a premium specialty bakery and café experience to urban workers and suburban dwellers" and "to become the best brand name of fresh bread in the United States". Its bakery-cafes are located in urban, suburban, strip mall, and regional mall locations. The concept is a mix between fast food and casual dining or fast casual. By using this strategy Panera is attempting to achieve a competitive advantage with the services and products it provides to its customers. The company is maintaining its target growth for 2013 of 4.5% to 5.5%.

Which of the five generic strategies discussed in Chapter 5 most closely fit the competitive approach that Panera bread is taking?

Generic Strategies: the category of Differentiation in order to help elaborate company strategies.

What type of competitive advantage is Panera bread trying to achieve?

They are striving for a competitive advantage based on Products, Environment and Services. They call it "fast casual", offering that rivals don't have and can't afford to match. As of February 5, 2012 Panera Bread had a reported income of $52M ending Q4 2012, this represents a 34% increase in diluted earnings shares since Q4 2011. As of December 25, 2012 there were 1,652 new bakery-cafes openings.

2. What does a SWOT analysis of Panera Bread reveal about the overall attractiveness of its situation?

Strengths: Repeat customers, appealing menu, customer service, in-house bread baking, low debt of company and comfortable dining environment.

Weaknesses: unclear strategic direction, not as a well know brand name as it rivals (Au Bon Pain, Chipotle and Starbucks) not counting it's other "fast food" rivals it has to contend with.

External Threats: Increased unemployment, high gas prices, general competition, inability to obtain land for future locations and easy to copy menu items.

Opportunities: Focus on healthy food choices, catering, global sales and look into airport and sports complex customers.

Does the company have any core competencies or distinctive competencies? Yes, bread baking expertise and a appealing menu.