Panera Bread Case Study Essays

1428 Words Jul 15th, 2010 6 Pages
Panera Bread is a company of small beginnings, starting out as a chain of small scale bakery-cafes along the east coast to having over 1,200 locations in over 40 states. Panera is a company that strives to project an inviting atmosphere in all of its establishments. Panera’s stores are mostly located in suburban areas with heir target customers being urban workers and suburban dwellers.

“A loaf of bread in every arm” is the mission statement of Panera Bread. Panera Bread bakes more bread each day than any bakery-cafe in the country. Panera’s menu spans from muffins and bagels to soups and salads to a variety of sandwiches. Panera Bread prides itself on providing the highest quality of food that customer enjoy.

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How much of the price is affected by cost is a major factor. Management needs to look at ways of offering lower priced foods without having an major financial impact on the company‘s profit margin.

One option that Panera can implement is lower priced menu options. This can be done in various ways to ensure the quality is not compromised. Panera could offer lower priced, smaller portions for the lunch menu. For example, in addition to offering a whole sandwich, Panera can offer half sandwich at a lesser price. This would also tie in with marketing to health conscious people because they would be getting healthier sized portions of food. Panera would also become more competitive with fast food restaurants such as McDonald’s that have everyday low-priced value option on their menu.

Although, this may be a good way to bring in a new customer base, there is also a downside. Introducing lower priced menu items may jeopardize Panera’s current competitive advantage. Panera has grown over the years by staying committed to what they believe in, which is providing a great dining experience. However, by offering a value menu, this may be seen to some customers as a step down, which could result in decreased sales.

Another option is for Panera to transform into a full service dining establishment. Essentially they

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