What is the strategy of Panera Bread and which of the five generic competitive strategies discussed in Chapter 5 best aligns with Panera Bread’s approach? What kind of competitive advantage is Panera Bread aiming to achieve?
The approach of Panera was to widely offer excellent bread to consumers all over the United States. Their bakery-cafes had an appealing menu and a pleasant dining atmosphere, leading to significant growth potential. This was notable considering the highly competitive nature of the restaurant industry. Additionally, Panera was acknowledged as the top player in the specialty bread category nationwide and achieved the highest level of customer loyalty among quick-casual restaurants.
Panera utilizes the best-cost provider strategy as their generic competitive approach. The reason for this choice is:
First, we will explain the best-cost provider strategy. This strategy aims to provide customers with more value for their money by meeting their expectations for qualities, features, performance, and service attributes, while also surpassing their price expectations. The goal is to have the lowest costs and prices compared to competitors who offer products with similar distinguishing attributes.
The main idea behind Panera is to offer a high-quality bakery and cafe experience to both urban workers and suburban residents. Panera specifically targets urban workers and suburban residents who are looking for a quick-service meal. They compete in five different submarkets within the food away from home industry, which include breakfast, lunch, daytime “chill out,” light evening options, and take-home bread. Panera’s growth strategy revolves around taking advantage of their market potential by opening both company-owned and franchised Panera Bread locations at a prudent pace. The competitive advantage that sets Panera apart includes their dough facilities, scale economies through the franchise system, and the software they utilize.
Management of Panera Bread needs to address what strategic issues and problems?
Panera faces a challenge with low market penetration in major cities, requiring strategic expansion efforts to address this issue.
Is there another thing?
To improve their dinner menu, as it is currently inadequate for that time, they may consider exploring options in other countries like some of their competitors.
