In-Depth Strategic Management Analysis of Panera Bread Company

This report provides a comprehensive strategic management analysis of Panera Bread Company, examining its external and internal environments, competitive positioning, and financial performance. It includes an overview of the company's mission, vision, and objectives, followed by a PESTEL analysis, Porter's Five Forces analysis, and a strategic group map to assess the competitive landscape. The report also evaluates Panera Bread's marketing strategies, key success factors, and competitive profile matrix in comparison to rivals like Starbucks and Chipotle. A value chain analysis and ABC costing are used to understand the company's cost structure, while profitability, liquidity, asset efficiency, and gearing ratios are analyzed to assess its financial health. Finally, a SWOT analysis identifies internal strengths and weaknesses, as well as external opportunities and threats, to determine if the company's strategy is a winner. This document is available on Desklib, a platform offering a wide range of study resources and AI-powered tools for students.

Running head: STRATEGIC MANAGEMENT
Strategic Management
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Executive Summary
The report helps in analysis of the strategic management of the Panera Bread Company as
this will help in analyzing the different competitors in the entire market. The proper external
and internal analysis of the company is required to be done as this helps in managing their
condition in the market which will help in solving the issues effectively. It has been noticed
that there are financial ratios and other ratios which helps in managing their activities
effectively.

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Table of Contents
Introduction................................................................................................................................4
Overview of Panera Bread Company.........................................................................................4
Mission and Vision................................................................................................................4
Objectives...................................................................................................................................5
Macro Environment...................................................................................................................5
Porter’s Five Forces Analysis of Panera Bread Company.........................................................6
Marketing of Panera Bread Company and Strategic Group Map..............................................7
Position of the Industry Rivals in market...................................................................................8
Three Year Sales of the Panera Bread Company...................................................................8
Key Success Factors of Panera Bread Company.....................................................................10
Analysis Tool and Evaluation..................................................................................................11
Competitive Profile Matrix of Panera Bread Company...........................................................11
Value Chain Analysis and ABC Costing.................................................................................12
Business Level Strategy of Panera Bread................................................................................13
Ratios and Financial Instrument Analysis................................................................................14
Profitability Ratios...............................................................................................................14
Liquidity Ratios....................................................................................................................14
Asset Efficiency Ratios........................................................................................................15
Gearing Ratios......................................................................................................................15
Financial Instrument.............................................................................................................16
Internal Factors Evaluation of Panera Bread (SWOT Analysis).............................................16

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Is Strategy of Company a Winner?..........................................................................................18
References................................................................................................................................20

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Introduction
The report helps in analysing the strategic management of the Panera Bread Company
which will help in managing and identifying the different kinds of growth strategy which is
adopted by the company. Furthermore, the external and internal analysis will be performed in
order to analyse and adopt the different strategies which will improve the growth of the
company in an effective and appropriate manner.
Overview of Panera Bread Company
Panera Bread Company is the American chain of bakery café which is the fast-casual
restaurants based in United States and in Canada. The headquarters of the company is
situated in Sunset Hills, Missouri. The company was founded in the year 1987 which was 31
years ago and the founder of the company was Ken Rosenthal and Louis Kane. The offerings
include soups, salads and sandwiches.
Mission and Vision
The mission of the company helps in describing the path in which this has helped
them in managing the different kinds of offerings which are provided to the individuals in an
effective manner.
The vision of the company is to focus mainly on producing various soups along with
different sandwiches. The vision helps in describing the path wherein the organization is
heading and there are different reasons behind the same as well.
The values of the company is to provide the different customers with cleaned along
with nutrient rich food items which is essential in nature.

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Objectives
 To differentiate their products from the other competitors in the market
 To target the urban individuals and analyse their dining experience
 To open more than 100 outlets in different other locations
Macro Environment
Political Factors- play a significant role in gaining long term profitability of the
company in an effective manner. Proper analysis of the risk of the military evasion is required
to be analysed wherein there are different trade regulations and tariffs related to the different
services (Hill et al. 2017).
Economic Factors- It plays a significant role wherein the economic factors have a
significant impact on the business. The purchasing power of consumers along with supply of
the money is wherein it is working as the economy. The impact of the economic factors is
high on the business of Panera Bread Company.
Social Factors- This affects the business in an effective way wherein the trends and
culture of the surroundings keeps on changing in an effective manner. Furthermore, as the
society is growing towards the entire trend of being more health conscious in nature. The
social factors have positive impact on the business.
Technological Factors- This is the other factor wherein effect of the technology is
greater in the business and company has introduced 2.0 app in which it helped the customers
in differentiating between dine in and large orders. At the end of the 2015, Panera Bread was
successful in their mission of attracting more than 20 million members in an effective
manner.
Legal Factors- This is the other factor wherein there are different threats faced by
employees in 2012 as there was engagement of different union activities. Furthermore, the

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legal risks need to be solved by the company by introducing different legal rules and acts and
the legal factors have moderate impact on the company as well.
Environmental Factors- The different environmental factors such as change in
climate and pollution and this affects the business in an effective manner. The impact of the
environmental factors do not have much effect on the Panera Business.
Porter’s Five Forces Analysis of Panera Bread Company
Threat of new entrants- It has been seen that the new entrants are introducing
innovative strategies and this is affecting the brand image of Panera Bread Company.
Bargaining power of the suppliers- It can be seen that the suppliers are in dominant
position and this can decrease the margin and this affects the morale of the morale of the
employees.
Bargaining power of the Buyers- It can be seen that buyers demand a lot and they
prefer to the choose the ones which will provide the same products at a less price and this
affects the brand name of Panera Bread.
Threat of Substitutes- This can be seen that there are different other competitors such
as Starbucks which provide same kind of food and this will create huge pressure on the
company as well.
Rivalry among the competitors- This is the other concern wherein there is rivalry
among the existing competitors and this affects the entire brand image of the company in a
negative manner.

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Marketing of Panera Bread Company and Strategic Group Map
Products- Panera Breads is famous in owning and franchises different kinds of
restaurants within the entire fast food industry. The restaurant helps in offering fresh baked
goods, made to order sandwiches, soups and salads along with different kinds of providing
catering services.
Target Market – The different customers that Panera Bread Company aims is to
capture the families and individuals who pursue healthy lifestyles. Additionally, these are the
different customers who are technologically inclined towards purchasing the different
products and services in an effective manner and they earn a salary of more than $75000 per
year. The marketing development of the company helps in focusing mainly on the families
and the smart well-being.
Positioning of the product- The product position of Panera Bread Company has not
been clear in the recent era. The CEO of the company came with the letter describing in
which the future of the company has been seen and analysed. The main goal of the company
is to promote the healthy environment which will bring proper sustainability in the market.

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Position of the Industry Rivals in market
As it has been mentioned previously, the main competitor of Panera Bread Company
is Starbucks. Starbucks has tried to expand the offerings beyond only offering coffee to the
customers and they try to enhance the competition in drastic manner as well. The menu of the
Starbucks will include more options of food such as different kinds of sandwiches along with
salads. Furthermore, Starbucks has tried to add different drive thrus to different locations
which will help in managing the different locations in an effective manner (Hill 2017).
Starbucks, which is the main competitor of Panera Bread company has the different
customers who are technologically kind of inclined and the company wants a place wherein
the customers can spend quality time and food along with different beverages. The
competition is keener in nature between the two companies as Panera Bread Company and
Starbucks have overlapping the target audiences. On the other hand, the other major
competitor of Panera Bread company is Chipotle Mexican Grill which is the major
competitor (Robson 2015).
Both the organizations are the companies which tries to operate food chain restaurants
which are considered to be fast casual kind of food and this will help them in managing the
differences in an effective manner. The segment of fast casual of the entire market helps in
tending which shares different kinds of similarities which includes quality ingredients along
with more upscale kind of décor of the restaurant and customizable food options for the
customers who visit the restaurants.
Three Year Sales of the Panera Bread Company
The sales figure in the respective table below illustrates that both Panera Bread
Company and Starbucks Corporation along with Chipotle Mexican Grill which have

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experienced greater success in the sales than the Panera Bread Company over the last three
years.
Figure 1: Total Sales in Comparison of Panera Bread Company’s Competitors
From the above figure, it can be analysed that the three-year stock performance of
Panera Bread Company, Chipotle Mexican Grill and Starbucks Corporation helps in showing
that the stock prices of Panera Bread Company are fluctuating in a higher manner in
comparison to the different other two competitors in the market that includes Chipotle
Mexican Grill and Starbucks Corporation (Rothaermel 2015).

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Proper competitor analysis is essential which is required to be analysed in an effective
manner as to understand the moves of the competitors and this will help the company in
managing the sales effectively as well. Furthermore, it has been seen and identified that the
positioning of Panera Bread is such that it is the fast-casual chain of restaurants which helps
in serving good and fresh quality breads along with coffee and different bakery products as
well. Furthermore, the competitor analysis will help the company in understanding the threats
which can be faced by them along with the opportunities that can be utilised to adopt such
strategies to improve their growth and focus mainly on the quality in an effective manner.
Key Success Factors of Panera Bread Company
The business model of Panera Bread helps in incorporating the main focus on the
high-quality foods which are offered to the customers at low costs. Furthermore, this has been
observed that there is growing trend within the food industry especially for the quick service
restaurants. In the previous scenario, it can be analysed and seen that the different restaurants
mainly focused on providing the clean kind of facilities along with proper and efficient
customer service as well. These are the different cost-effective methods which are the
different ways to save money and bring more individuals into the restaurant.

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Furthermore, Panera Bread has tried to insert another kind of technique by adding the
other concept which includes the creative recipes that helps in featuring cheap proteins as this
helps the company in making profit while this will help the customers in saving the money as
well. Panera Bread Company is the fastest growing chains in the United States and there are
more than 1400 stores which helps them company in gaining huge amount of profit as well
(Hitt and Duane 2017).