Final Project Module 5
Question 1: Discuss the distinguishing features (Market size, Market growth rate, Industry strength, etc.) of the industry. “Market size and growth rate indicates how big the industry is and how fast it is growing. Market size industry’s position includes the product life cycle which includes early development, rapid growth and takes off, early maturity and slowing growth, saturation and stagnation and decline.” Thompson The Panera Bread Company began in 1993 under the name Au Bon Pain’s café style bakeries in the Saint Louis area and the market size grew very rapidly. Panera Bread Company market size was very substantial. Between the years of 1993 and 1997, Panera Bread Company average unit volumes increased by 75 percent. In 1998 management of the Panera Bread Company realized that the company should be rolled out nationwide. The management decided to divest the Au Bon Pain cafes and completely go with the Panera Bread concept. By 1999 the Panera Bread Company had 180 cafes in the Saint Louis area. Between January 1999 and December 2006 an additional 850 cafes were opened. In the year 2000, 172 franchised bakery- cafes were opened by year end and 90 company- owned bakery- cafes were opened. Totally 262 bakery- cafes combined were open in 2000. By the year 2006, 636 franchised bakery-cafes were opened by year end and 391 company- owned bakery- cafes were opened. Totaling 1,027 cafes were open in 2006. The management of Panera Bread wanted to continue to expand the cafes nationally. Panera Bread cafes continued grow by 17 percent annually throughout the year 2010. The market growth rate of Panera Bread Company exploded. In the year 2000, the revenue at company-operated stores was reported at $125.5 million and franchised stores reported $324.9 million. The average weekly sales of company – owned cafes in 2000 were $28,325 and franchised cafes was $32,832. In the year 2000, the revenue at company-operated stores was reported at $666.1 million and franchised stores reported $1,911.6 million. The company reported sales of over $829.0 million and the net income of $58.8 million was reported in 2006. The average weekly sales of company – owned cafes in 2006 were $$37,833 and franchised cafes was $39,894. In 2006, the management enhanced the evening meal menu to assist with building sales. In 2006, there were 40 number of Panera Bread units per 67,000 population per bakery café in Saint Louis and 26 number of Panera Bread units per 152,000 population per bakery café in Washington D.C / Northern Virginia. Panera Bread Company industry strengths were the marketing strategies and commitment to their customers. Panera Bread Company marketed to urban workers and suburban dwellers looking for a quick service meal. The management of Panera Bread Company wanted to provide a more pleasant dinner experience in an environment that was comfortable. Panera Bread Company offered premium fresh soups, salads and sandwiches on fresh baked bread during the morning, lunch, daytime and evening. The fresh baked bread was the signature product of Panera Bread which was made with four ingredients which was water, natural yeast, flour and salt. No preservatives or chemicals were used in the bread. There were over 20 different types of bread baked fresh daily at each location. The cafes were quick and casual but the environment was more homelike feel. Even though the restaurants were quick to serve their clientele the menu items were made to order. Management of the Panera Bread continues to review the menu items and adjusted according to the time of the season. New products were rolled out and introduced the customers which were called “Celebrations.”
Question 2: Discuss the competition within the industry. Who are the main players? How intense is the rivalry? How attractive is the...
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