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Business administration Assignment: A case study of Panera Breads

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1. What does a SWOT analysis of Panera Bread reveal about the overall

attractiveness of its situation? Does the company have any core competencies or

distinctive competencies?

The SWOT analysis is a crucial technique for assessing a business's overall status. A

firm or business's strengths, weaknesses, opportunities, and threats are listed. This is

significant to the management because it offers them the chance to address their areas of

weakness in order to capitalize on the chances presented to expand the company by

developing the necessary plans to make the most of its advantages. The following

conclusions concerning the circumstance at Panera Bread are made with the aid of this tool:

Strengths

Panera Bread's expertise in bread baking and high-quality bread products are its major

strengths. In order to provide high-quality meals at a reasonable price, Panera uses only very

high-quality products free of artificial additions. Additionally, Panera produces a variety of

goods that appeal to a wide spectrum of consumers. Due to the absence of lipids and other

ingredients like gluten, the products are healthy for all consumers. Panera has a strong brand

identity because it is present in 45 US states, Ontario, and the Colombian region and in 2016,

the company was regarded as a clear leader in the fast casual industry, a position it has

maintained until 2021 (Eckhardt & Dobscha, 2018). Panera has a good customer satisfaction

rating. As a highly regarded fast-casual restaurant, Panera has won praise and awards for its

performance. It also has a large customer base that includes schools and events because of its

offsite services. Lastly, it has a solid financial base that allows it to grow and expand.

Weaknesses
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Strong brands such as Starbucks compete with Panera. Panera does not have an

international presence because it only operates in the United States and North America. Its

brand name lags behind those of its competitors. Panera Breads also lacks diversification in

its offering and operation and therefore, its customer base is limited. According to (Eckhardt

& Dobscha, 2018), the company was faced with some law suits that saw it lose its brand

name to rivals.

Opportunities

Panera Breads has a possibility of expanding to all 50 states in the US. It also has an

opportunity to create more supper options to outperform its rivals. In 2016, Panera Breads

grew from 2000 locations to 2076 stations and this shows that the company has a lot of room

for growth. The statistics done by the National Restaurant Association in 2015 showed that

over 68% of consumers were interested in locally produced food and this offers Panera

Breads an opportunity for growth. Lastly, Panera Breads has an opportunity to diversify its

offerings in the market to increase its revenues and growth.

Threats

The food industry is highly competitive. Imitation from competitors on the menu

items is also a major threat to Panera. There is also a threat from new entrants into the food

industry that provide new culinary items that people like. There is also a low performance of

the economy in the US and this is affecting its success. Panera Breads was also affected by

the global pandemic of Covid 19 in 2020-2021 when the effects were dire since the lockdown

imposed by the authorities affected its revenues and it had to be turned into a grocery to

mitigate the risks. Climate change that is also present in the global word has affected food

supply and this has posed as the biggest threat to the company.
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Core Competency

A core competency is defined as the ability of a company to perform an internal

activity that forms the core of its business strategy. A distinctive competency makes a

business compete against its rivals. The main core competency by Panera is its baking

expertise and a friendly environment. Their distinctive competency is its artisan quality and

the provision of ingredients that are free of additives. This distinguishes Panera from its

competitors. The SWOT analysis of Panera is a strong one as it has more strengths and few

weaknesses that need improving. The external threats Panera faces are modest.

2. Select one of the Fast-Casual restaurant competitors to Panera Bread. Compare

the two companies utilizing competitive analysis principles and practices. Which

company is better prepared to be a major force in the Fast-Casual restaurant

space? Detail your rationale for your conclusion.

In my case, I made a comparison between Panera Bread and Chipotle Mexican Grill.

From the analysis, there exists several similarities which include: the two restaurants use high

grade quality ingredients in their menu. The other similarity is that the two are active in

expanding into new locations and thirdly, the two have a strong financial power which has

enabled them to prosper. This said, I find that Panera Breads is much prepared to be a force to

reckon in the fast casual restaurant business since it has a stable performance and continuous

growth since 2010 after the recession that was reported between 2008-2009. Panera is

therefore a clear leader in this industry. It also offers artisan goods that are special to the

customers and this ensures that the customers are satisfied with their services which leads to

loyalty. Lastly, Panera is not recovering from the national crisis of a food virus that was

reported.
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3. Does Panera Bread’s Pay-What-You-Want bakery-café concept constitute an

adequate demonstration of Panera’s stance on social responsibility? Explain

your perspectives

Panera Bread has a social responsibility of giving back to the society. It gives back to the

local community where it operates and an example is when it donates millions of dollars in

some of its unbaked product in its Day End Dough Nation program. The bakery has good

motives to feed and help people in need especially in this world that food security is

becoming an issue. Panera operates in middle class to wealthy places and this has lowered the

number of people who can participate in Pay-What-You-Want bakery café. I concur with the

decision from its leadership to do away with the program and to strategize on its social

responsibility roles.

4. What strategic issues and problems does Panera Bread management need to

address?

Panera Breads has a number of strategic difficulties, including low dinner sales in

comparison to competitors such as Starbucks the dinner has been low historically to help

meet the cost of managing them and this has been a worry to Panera. Better menu items will

increase its supper sales as it seeks to beat the competitors. Another strategic challenge is the

company's poor growth and diminishing profits. The bakery must double-check its earnings

projections and make them work. Furthermore, the corporation must solve the issue of why

franchise stores earn more profit than corporate stores, and last, they must sell their brand in

the media to ensure that it is recognized globally. This will provide an opportunity for them

to change the perception people have on their dinner. Panera is also having issues in terms of

location since it lacks its cafes near its competitors such as Starbucks.
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In 2019, Panera Breads lost over 100% of its workers and this was a trend until the

Covid-19 pandemic came to the country (Stowell & Katz, 2019). This turned the Panera

Bread joints into groceries as its operations were crippled. Competition from McDonald’s in

2019 and 2020 has also been an issue as it added more kiosks that ate deep into the market

share of Panera Breads. The global competition has made the strategic well being of Panera

to be compromised, a case that was not in existence since its inception.

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References

Eckhardt, G., & Dobscha, S. (2018). The Consumer Experience of Responsibilization: The

Case of Panera Cares. Journal Of Business Ethics, 159(3), 651-663.

https://doi.org/10.1007/s10551-018-3795-4

Stowell, D., & Katz, A. (2019). The Panera Bread LBO. Kellogg School Of Management

Cases, 1-30. https://doi.org/10.1108/case.kellogg.2021.000043