panera bread

Foundation of competitive strategy

GHOURRABOU Firdaous

By Mr Mark PORTER

2 lorem ipsum :: [Date]

SUMMARY:

o Pest (el) Analysis o Porter Analysis o Swot Analysis

o Analysis of the company

! Strategy of Panera bread:

- Key Success Factors

! Competitive analysis

! Franchise analysis

! Supply Chain analysis

o Panera Bread Facing a Challenge

Of

PANERA BREAD


(suite)

! Pest(el) Analysis:

" Political:

- Regulations and Licenses Health - Property and Safety rules and laws - Competition regulation - Taxes obligations " Economic:

- Strong Competitors such as BAGL - Economic growth " Social:

- Social preferences and also differences/similarities - Trends and Health issues - Presence and awareness of obesity Guilty Pleasures

" Technology:

- Emerging technology: Pre Ordering online - A high speed internet

As we can hear in too many ways and from too many different people, many legal

regulations about food poisoning exist, so what should Managers do to be straight

and follow it? Well they simply must follow all of them in order to avoid penalties

and legal proceedings, knowing that regulations about employees represent also an

important and major role to maintain stability within the company, and here within

Panera Bread Company.


! Porter Analysis:

Threat of new entry:

The threat of potential new entrant is strong. The barriers to get into the industry are low. Its not

that expensive to start a business in this field. For this reason we can find a lot of new entrants.

Competitive Rivalry:

The competition is really strong for Panera Bread. There are so many direct competitors to the firm

such as Starbucks, Atlanta bread company, Chipotle Mexican grill , Brueggers and many others (

as we can see in the appendix 9).Those firm are all fighting for the same goal : attracting customers

and making profits. Theyre all offering similar products which make it a hard competitive industry.

Threat of substitutes:

The threat of substitutes is Strong. Substitute product can be restaurants, fine dining even fast foods

that offer different products or services from Panera bread. Substitute product can also be all the

indirect competitors that offer different kind of food , locations , services. Given the fact That many restaurants and fastfood chains exist in the United states , It explains That

the threat of substitutes Is really strong.

Bargaining power of buyers :

The bargaining power of buyers is strong. The buyers are

affecting all the aspects ( the competition , the potential new

entrants , and the substitutes ) However we can notice that

Americans dont eat out everyday in a restaurant.

Bargaining power of supplier:

The bargaining power of supplier is weak due to the switching

costs.


! Swot Analysis of Panera Bread

Strengths:

- High Competence in bread baking - Massive customer loyalty and Brand awareness - As student doing supply chain I can theyve screened a very high performance in supply chain - Loyal to its brands image with a good franchise - dough making efficiency, quality - Leading company in the bakery-caf segment

Weaknesses:

- Skinny corps of diversification in menus in comparison with the competitors - Base in U.S and Canada, nearly Unknown in Europe

Opportunities:

- Opening up to Europe and other countries - International expansion - Organic and BIO Products - Advertisement and Promoting

Threats:

- Massive competition : Restaurants industry - Fullness of the Market (Saturation of the Market) - People consume less and go out because of the economic crisis - The increasing of the vegan/organic trends - Extremely high operating costs

S W

O T

Strategy of Panera bread: - Key Success Factors

Differentiation is a key success factor for any business industry and especially for Panera bread. Due to the hard rivalry, its important for each firm to stand out from the competition. Panera Bread is a successful firm in the US for many reasons:

Consistent quality: The company offers to their customers fresh baked goods , as well as a tasty experience by using the best products on the market.

Low operating costs

Place: Multiple locations across the US ( near great amount of traffic) in order to respond to the customers needs. The stores are unique ( fireplaces , high quality furniture, cozy setting areas)

Franchise strategy

Long-term objectives

PGES concept: Product , Environment , great service ( PEGS)

" Panera Bread is doing well by providing to their customers the best quality in terms of product , services and environment.


Competitive analysis

Nowadays, most restaurants are trying their best to attract customers by responding to

their needs and preferences: such as providing the best dishes and menus as well as trendy

food such as organic, vegetarian food. Obviously, Panera has a competitive advantage

against it competitors by offering goods and ingredients that some competitors cant really

afford. Despite the fact that Panera has many competitors in the restaurant/fast food field,

the firm does have its own differentiation strategy fast casual restaurant. On the other

hand, the firm offers higher prices than other regular restaurants but today the customers

are willing to pay more for a better quality. Panera has also a great customer loyalty,

which can be a great competitive advantage.

Franchise analysis:

Franchising has an increasing role in the economy of each country and especially in the united states. Paneras main franchise strategy was to provide its franchisees with market analysis , a training program for employees as well as certifications , benchmarking data and calendar planning assistance. This strategy turned out to be a successful.


Supply Chain analysis: The supply chain system of Panera bread provides bakery cafes with high-Quality food. The firm uses distributors to distribute products and materials to bakery cafes. Franchise-operated cafs operate under contracts with one of Paneras independent distributors. This strategy include 2 initiatives: creating relationship with suppliers and adopting a discipline that allows firms to control costs and risks ( vendor management ) .

From the suppliers of Panera Bread of their raw materials to produce bread and so son

ever, the best bakeries, that they produce in fact themselves in the proper shops, to the

Factories and then to not the Warehouse but to the Bakeries straight away, sometimes in

the same place to be finally sold to the final customers and wait afterwards their feedback

and work on gaining their loyalty.


! The challenge of Panera Bread:

Despite the fact that Panera bread is a successful company (high growth rate, competitive

advantage,..).The firm is operating in a high competitive industry (restaurant/fast food )

which obliges the company to constantly renew their strategy in order to attract customers and

achieve profitable growth as well. Therefore how can Panera renew their strategy and

continue to achieve high profits knowing that the competition is assiduous?

As far as I am concerned I think that Panera should extend their stores not only in the United

States and Canada but also in Europe and specially in big cities such as London, Madrid,

Amsterdam,. This strategy of international extension can allow Panera to have a better

notoriety as well as a higher brand awareness in Europe. However , Panera Should also keep

an eye on the american market which is constantly changing. In order to renew its strategy ,

Panera should propose more healthier options in the purpose to fight obesity and to raise

awareness about health issues that Americans are facing on a daily basis. The firm could also

offer Organic and vegetarian options for specific customers. As a third option , the firm needs

to learn how to promote itself through social networks , commercials and TV spots.

Thank you Sir.

panera bread

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