Essay on Case Study 2 Panera Bread

Case Study #2- Panera Bread
Sarah Helm

1. The strategy of Panera is to aggressively expand their market presence and they aiming to do this through the quality of the dining experience. The generic strategy that fits most closely with the 5 generic competitive strategies is the broad differentiation strategy. This type of strategy seeks to differentiate the company’s product offerings from competitors. They try to do this by offering superior attributes the products that appeal to a broad group of buyers. Panera’s, “identity was in fresh-baked artisan breads made with craftsman’s attention to quality and detail” and they strived to be the “first choice for diners craving fresh-baked goods, a sandwich soup, a salad or a beverage served in a warm, friendly, comfortable dining environment.”
They strive to live in the space between a typical sit-down restaurant and a fast food restaurant. Panera desires to be the “in-between.” According to the case the target market was “urban workers and suburban and dwellers looking for quick service meal or light snack and an aesthetically pleasing dining experience.” Panera’s goal was to be a nationally recognized brand name and a dominate restaurant operator in upscale, quick service dinning. They wanted to be the top pick of fast-casual restaurants for diners.

2.
Strengths
-Menu Variety (lots of quality options)
- Amount of locations (location close to most anything in larger cities)
-Financially stable (long term success even in recession time)
-Customer Satisfaction (quality food and service with a clean, unique dinning experience)
Weaknesses
-marketing brand/brand recognition (lack of marketing in budget, people don’t know about until they decide to try, word of mouth isn’t always successful)
-Price of food (higher price for night as much food or as high quality as a sit down restaurant)
-High price of opening a franchise (creates lack of encouragement to join the franchise of Panera)
Opportunities
-Catering (high end quality food for large amounts of people)
-International expansion (Canada, South America)
-drive-thru (more competition with fast food but while offering higher quality)
Threats
-economy (although they maintined in a recession this is always a threat
-new entrants in the market (food is an easy market to get into, blazing the path isn’t always a good place to be).

3. A value chain identifies the primary activities and related support activities that create customer value. The idea behind this concept is to create value for customers. A value chain consists of two sections: primary and support activities. Primary activities are the front line of creating value for the customer and support activities facilitate and enhance the performance of the primary activities. The first section of primary activities is the supply chain. The only thing the case talks about is that Panera bread franchisees purchase their dough directly from Panera. Panera wants each of its stores to succeed because they receive royalties from sales. As the supplier to its stores Panera has a desire to keep the cost of dough as low as possible so the sales return from each franchise store is higher, maintaining sustainable franchise operations. In the Operations each Panera store receives the same complete training, set up, basically each store is identical in expectations and the way it operates. This took these tasks off each individual owner therefore decreases the cost to each store. The way that Panera operates in this way has been proven over time to be successful and has lowered costs and created a very well developed company. Another component of the Panera value chain is that the are continually evaluating the food they offer. They are evaluated for customer need/relevance, trends, and season. This takes the weak selling menu items off to increase operations. Distribution goes back to each store/franchise purchasing bread dough directly from Panera. They have dough-making facilities

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