Panera Bread: Occupying a Favourable
Position in a Highly Competitive
Industry
Group 3
Group Members:
 Marie Nikki R. Martinez M997Z208
 Marko Marinic M997Z206
 Anja Grgic M997Z2055
What is Panera Bread?
 A chain of specialty bakery-cafes
 Established in 1981
 Operating 1,493 company-owned and franchise-operated
bakery-cafes in 40 states and in Ontario Canada as of June
28, 2011, under the Panera Bread®, Saint Louis Bread
Co.® and Paradise Bakery & Café® names
 Company mission:A loaf of bread in every arm®
 Menus:
Bakery Menu (breads, bagels, egg souffles, pastries and sweets)
Cafe Menu (sandwiches, soups, hand-tossed salads, beverages
and Kids menu)
Changing Consumer Tastes
 The owners observed:
People were increasingly looking for products that were special
(different from typical restaurant food)
but
They didn´t want to give up the convenience of quick service
 Company concluded: consumers wanted the convenience of
fast food combined with a higher-quality experience
Question 1 : Positioning
 Panera Bread has established a unique position in the restaurant
industry.
 “Fast casual” –The position that Panera has established allows it to
capture the advantages of both fast food and casual dining. It is clear
that this unique position has contributed to Panera’s success.
 It provides Panera a distinct point of differentiation between itself and
many of its competitors, and allows the company to sell a fairly large
volume of high margin food products.
Question 2 – five forces analysis
The Restaurant Industry
Competitive Forces
Threat to Industry Profitability
Low
Threat of Substitutes
Threat of New
Entrants
Rivalry among
existing firms
Bargaining power of
suppliers
Bargaining power of
buyers
Medium
High
Question 3 – barriers to entry

Panera has created barriers to entry in the following areas:
1.
2.
Product Differentiation
Cost Advantages Independent of Size
Question 4 – primary sources of
competitive advantage
Panera’s primary sources of competitive advantage are:
1. Its position in the restaurant industry
2. The atmosphere of its restaurants
3. The quality of its bakery products
4. Its brand strength
Application Questions:
 Ethical ways to overlook potential competitors in the fast-casual
category
1. Overlook competitors by doing some online research, trade
magazines, trade associations. Who are the new competitors on
both national and local level. Check the stories in newspaper articles, if
they are publicly traded, read their annual reports (useful information
about future plans, growth strategies, new products or services, is their
sales increasing or not...)
2. In-person market research , visit competitors´ restaurant. If I
am a customer, how would I feel about their service and products?
What are its strong and weak points? What kind of marketing are they
using? Is their web site good? Are their locations crowded? How is the
atmosphere? How is their customer service, do they answer the phone?
Application Questions:
 Other businesses that have established
unique positions in their industries:
1. Zappos- online shoe store
2. Starbucks