A write-up that I recently read about Panera Bread’s expansion plans gave me hope in this troubling economy (see: “Panera Looks to New Venues in Expansion,” Reuters, 3/19/09). A national bakery chain with a well-developed brand name, good quality ingredients, convenient and competitive food offerings, and plenty of room for growth, Panera Bread Hours has evolved a formula which should help guarantee solid returns for years to come. Panera currently has 1,250 locations with plans to open yet another 80-90 locations this season, an increase of approximately 7% of its current locations. In California, Panera has just 80 locations, so you can find considerable opportunities within that state alone. Since becoming wholly independent from Au Bon Pain Co. in 1999, Panera’s stock has grown thirteen fold, and in 2006, was accepted as the top performer within the restaurant category for one-, five- and ten-year returns to shareholders, so it’s success is nothing sudden – it has been growing slowly and steadily.
Personally, I love Panera. The bread is freshly baked, the menu offerings are well-thought out, the atmosphere is inviting and warm, and the prices are reasonable…and, I personally can’t consider a fast casual cafe chain that comes even close to winning vs. Panera on any one of those dimensions. Au Bon Pain was made on the same premise that brought Panera success – hospitality, quality, fresh baked goods – yet it is, in my opinion, a pale comparison. Take as an example, hospitality – in Panera Bread Hours, you happen to be given a beeper while waiting for your food, so there is absolutely no confusion when your food is prepared and even, someone behind the counter will fall out of their way to bring your food for your table. The food is served on actual plates with real silverware and also the seating includes comfortable booths and cozy armchairs. In Au Bon Pain, the silverware is plastic, the chairs are stiff and you must bring the food to your table yourself as well as the order process involves a less personal approach of completing a form and handing the form to the order taker. With regards to quality and freshness, Panera also wins hands-down. The bread is served right out of the oven plus they sell their baguettes to consider home, something which Au Bon Pain either does not do or will not effectively communicate that it does.
Most of us know how a hot sandwich can reveal the ingredients’ flavors – Panera knows this and provides paninis – a design of grilling sandwiches that is extremely popular. At Au Bon Pain, instead of paninis, it provides ‘hot sandwiches’, that are sandwiches that are continuously kept warm under a heat lamp. If you’ve had food which is kept warm like that, you’ll know which it just doesn’t taste excellent or very fresh. To get a place that promotes the quality and freshness of the breads, Au Bon Pain simply qxuhyp not do pretty much as good employment executing. Finally, in terms of I can tell, Panera also wins on value. At Panera Bread Headquarters Address, your order of a sandwich automatically comes with a bag of chips along with a pickle thrown in and they also smartly provide a half-sandwich and soup or salad combination, popular with health-conscious customers. At Au Bon Pain, virtually every ingredient is line-itemed and you certainly don’t get the pickle…leading to some tab that is certainly more often than not$1-$2 more. So, what went wrong with Au Bon Pain? In 1999, it went public and after that got shuffled around to various private equity groups. It certainly hasn’t changed much over the years and hasn’t attempted to improve its offerings relative to Panera’s.
Perhaps, due to its success over time and a lack of a severe competitor, it hasn’t needed to. But, let’s get real – in a health-conscious, quality, value driven economy like one that we live in – where can you rather opt for lunch?