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Panera Bread’s Strategy

Autor:   •  October 9, 2016  •  Lab Report  •  1,284 Words (6 Pages)  •  991 Views

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Abraham Rossi & Niklas Flint

Business Strategy

27.09.2016


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  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 Breads Strategy consists of the 3 following points:

  • fresh, high quality, organic meals to metropolitan citizens.
  • fast meals in a visually appealing, comfortable environment.
  • meals with reduced additives or preservatives

Their driving concept is to provide premium specialty bakery and café experience to urban workers and suburban dwellers. They hold a unique position in the Market, which attracts a wide range of customers. High quality, healthy products with fast service seem to be the key factors of their success and led them to be the dominant competitor in the sector.

Panera is obviously driving a Broad Differentiation Strategy. Their distinctive menu allows Panera Bread to compete in 5 submarkets. Even though they started the business in 1981 with a focus differentiated strategy, as they found the market niche in bakery-café. As the company grew and developed to be a franchise they enlarged their product spectrum. Targeting a broad Cross-Section of buyers implies the Broad Differentiation Strategy.

Panera Competitive Advantage is, as CEO Ron Shaich says, their Product, Environment and Greater Service (PEGS). Which, all 3 combined makes them different from all their competitors.

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? 

Strengths:

  • Fresh high quality food (attractive/ appealing menu)
  • Strong financial position
  • Good working franchisees

Weaknesses:

  • Less known brand name than rivals
  • Company owned stores earn less than franchisees
  • Low marking activities

Opportunities:

  • Growth potential in new geographic markets (national and international
  • Catering service started well
  • Expand into untapped markets
  • Penetrate “low penetration markets
  • Invest in catering markets
  • Penetrate markets in order to grow market share
  • Invest in Marketing, strengthen brand name

Threats:

  • Rivals begin to imitate the menu and ambience
  • Market saturation by competitors
  • Expand with and without franchisees (lower risk)
  • Invest in Marketing (better known Brand name will strengthen USP)
  • Tackle threat of competitors by strengthening the Brands name and everyday appearance

The SWOT- Analysis reveals a clear scenario regarding to overall attractiveness of Paneras situation. As the Strengths show, they have a good market position and lots of advantages which ensures them their current position. On the other hand, Panera has to be careful. As their Brand isn’t as famous as some of their rivals, and competitors start to imitate some of Paneras offers it could easily happen that they lose customers to the competition.

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