CASE 5.1 PANERA BREAD: Occupying a Favourable Position in a Highly Competitive Industry

Anthony MA1N0231Liisi 0A10F001

PROGRAM Panera bread – history Panera bread today - products The future Discussion questions

PANERA BREAD - HISTORY Au Bon Pain Co. 1981 + Saint Louis Bread Company (mid-

1990s) 2008, sales +23% ($941 mln) 2003 – 602 units 2008 – 1270 units 2012 – 1591 units

PANERA BREAD TODAY - PRODUCTS

THE FUTURE Fast Casual category Leading national brand

Positioning strategy Signature foods Savvy execution

DISCUSSION QUESTIONS – 1 How has Panera Bread established a

unique position in the restaurant industry?

How has this unique position contributed to its success?

DISCUSSION QUESTIONS – 1 Good timing Fast + casual (positioning) Customers needs Speciality foods

Window catching -> success

THE RESTAURANT INDUSTRY

DISCUSSION QUESTIONS - 2 Analyze the restaurant industry using

Porter’s five forces model. In what ways has Panera Bread successfully positioned itself against the forces that are suppressing the profitability of the restaurant industry as a whole?

PORTER’S FORCES

Competitive

Rivalry within an Industry

Bargaining

Power of

Suppliers

Bargaining Power

of Custome

rs

Threat of New

Entrants

Threat of Substitut

e Products

PANERA BREAD’S FORCES

Pioneer

Bakery,

artisan.

Healthy Menu

Brand’s recogniti

on

Fast-Food

Casual Dining

DISCUSSION QUESTIONS – 3 What barriers to entry has Panera

Bread created for potential competitors? How significant are those barriers?

•BRAND’S RECOGNITION: • PANERA BREAD =

FAST CASUAL• ARTISANAL BAKERY• HEALTHY FOOD

•PIONEER’S PRESTIGE•20YEARS OF EXPERIENCE

•1,591 UNITS IN US

DISCUSSION QUESTIONS – 4 What are Panera Bread’s primary

sources of competitive advantage? In your judgement, are these sources of advantage sustainable? Why or why not?

•BRAND’S RECOGNITION: • PANERA BREAD =

FAST CASUAL• ARTISANAL BAKERY• HEALTHY FOOD

•PIONEER’S PRESTIGE•20YEARS OF EXPERIENCE

•1,591 UNITS IN US

DISCUSSION QUESION – 1B Do you think Panera Bread will reach its

goal of becoming a leading national brand in the restaurant industry? Why or why not?

APPLEBEE’S

MCDONALD’S

APPLICATION QUESTIONS - 1 What are the ways that Panera Bread

can conduct ethical and proper forms of competitive analysis to learn about potential competitors entering the fast-casual category?

COMPETITOR ARRAY – “MARKET”Key Industry Success Factors

Weighting

Competitor #1 rating

Competitor #1 weighted

Competitor #2 rating

Competitor #2 weighted

Panera Bread

Extensive Distribution

0.4 6 2.4 3 1.2

Customer focus

0.3 4 1.2 5 1.5

Economies of scale

0.2 3 0.6 3 0.6

Product innovation

0.1 7 0.7 4 0.4

Total 1.0 20 4.9 15 3.7

COMPETITOR PROFILING Background

key personalities, location of offices, etc… Financials

Method of growth, Liquidity, etc… Products

Brand loyalty, New products developed, patents, etc… Marketing

4P’s Facilities

Plant capacity, shipping logistics, etc… Personnel

Number of employees, management style, etc… Corporate and Marketing strategies

Objectives, growth plan, etc…

APPLICATION QUESTIONS - 2 Think at least two other businesses

that have established unique positions in their industries. How have their unique positions contributed to their success?

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