Panera Bread Company’s Competitive Capabilities:
i. Business Strategy:
Panera Bread Company s strategic intent was “to make Panera Bread a nationally ‟
recognized brand name and to be the dominant restaurant operator in the specialty
bakery-café segment.” Panera intended to achieve this by “being better than the guy across
the street” and implementing a successful business model. Panera s business model ‟
satisfyed customers needs through providing quality food in a casual setting that ‟
continued to bring customers in for the ambiance as well as the food. Panera achieved
sufficient profits to cover the costs of providing this value to the customers by selling food
in the cafés and by collecting franchising fees and a percentage of franchisee sales.
Management intended to grow the number of Panera Bread locations by 17% annually and
expand further into suburban markets. Panera focused on achieving a 1 caf per 160,000
people per location ratio by 2010 through effective use of franchising. Panera intended to
build a loyal clientele by employing a superior business model
and offering artisan breads as a base of a high quality menu that changed to reflect
evolving consumer tastes.
The prevailing market in which Panera operated experienced 5% growth in 2006. Thus
Panera s strategy of growth was in sync with market conditions. Furthermore, by focusing‟
on building a loyal clientele through quality breads and a menu that suits customers tastes,
Panera tailored the strategy to strengths the company already possessed. Panera s ability ‟
to create well crafted, predictive strategies and adapt well to changing conditions with
