Panera Bread Swot Analysis

Panera Bread Case Study

Nicholas E. Farley

University of Northwestern Ohio

Panera Bread is a boutique style eatery that specializes in baked goods such as muffins, cookies, and breads. They maintain a friendly coffee shop style atmosphere where people can meet, relax, and eat. The company was founded in 1981 under the name Au Bon Pain Co., Inc. by Louis Kane and Ron Shaich. They found a great deal of success along the Eastern United States, and eventually they took the company international. The company prospered during the 1980s and 1990s when they bought a bread company called Saint Louis Bread Company. In 1993 the company was re-branded as Panera Bread and has continued to be a successful competitor in the bakery and coffee shop market. Panera positions themselves as a one stop shop for people looking for baked goods, specialty foods, and a casual dining experience.

        Panera Bread’s product is a combination of two things, food and atmosphere. The company offers baked goods, drinks, and sandwiches that are beyond the typical offering from food chains such as McDonalds or Burger King. However, they do capture one important element that McDonalds and Burger King are known for. Consistency, whether you go to a Panera Bread in Ohio or Florida you can expect a product that is consistent with items that you have purchased from Panera Breads at other locations. Currently the company has 1926 franchises around the world where you can expect consistency in food and atmosphere.

        Panera Bread’s promotion and price are the biggest factor in regards to what market they serve. Prices at Panera Bread are only somewhat higher in comparison to competing restaurants. The higher price forces consumers to make a decision between spending a few more dollars for the quality, freshness, and atmosphere that is not offered by competing businesses. Soups and salads begin at or around $4.50. However, the al carte menu allows customers to add on as many items as they wish with substantial price increases.

Environmental Forces

Environmental forces that act upon Panera Bread differ greatly in the scope and effect they have on the company.  Working from the least influential to the most influential environmental factors brings us to the technological aspect of running a restaurant and the political and legal forces that act on the company.

Technological forces are rather simple to overcome for a restaurant business. Basic communication platforms need to be implemented and maintained, and information tracking systems are used to refine the process of operations as well as the location selection method for new franchises.

Panera Bread just like other restaurants has to abide by all health regulations set by the Food and Drug Administration. Some Panera locations sell alcohol to their patrons, however, this is just another layer of health and safety regulations set by the FDA along with a permit issued by the city that the Panera Bread location resides within.

Economic forces that act upon Panera Bread can be more important than the previously mentioned environmental forces. However, it seems as if the recent movement towards healthier options has helped Panera Bread because many people perceive fresher food to be better health wise. However, on that same note, glucose (which is at high levels in much of Panera’s offerings) could prove to have the opposite effect on the business as more and more people become health conscious. Regardless, the business has continued to grow through some of the harder times that the economy has faced in recent years.