Panera makes news by not discounting its bread
Filed under: Food
In times like these, people: they want quality, not quantity; and they'd rather stick with reliable businesses no matter what the price. The company that survives? It'll offer plenty of valuable perks; customers in the know are happy to pay more for good service with the extras.Wait: huh?
That's what competitors are saying in a mix of horror and awe as bakery/coffeeshop chain Panera Bread continues to fill tables with customers, cheerfully paying the same for the same bread, pastries and sandwiches as they did when times were good. The company is reporting that same-store sales rose 2.8% in the first 27 days of the third quarter, and is predicting more growth across the board -- operating profit, average customer check, and number of transactions -- for the quarter. And according to the Wall Street Journal, this is because the company is offering quality products and "bucking industry trends" by refusing to cut prices. Loyal customers point to the free Wi-Fi, a perk Panera has long offered its customers.
The CEO's statements may not make him any friends among his customer base. Ron Shaich says that he's "focused on the 90% [of Americans] that are still employed." Well, fuzzy math aside -- 10% unemployment rate does not mean that 90% of the country has a job, it's far less than that (here's one explanation, which doesn't even count those who are unemployed by choice) -- this is sort of insulting.
What's more, WalletPop writers as a group were skeptical. Sure, many of us have used the Wi-Fi at Panera. But Gina Roberts-Grey, in upstate New York, reports that her local Panera Bread is far less busy than its less-fancy competitors. "At noon, the height of the lunch rush, I had my pick of empty tables, unlike the McD's right next door whose drive-thru line was in the street and dining room was full," she writes. Outside of Detroit, where the unemployment rate is high, Shaich's theory seems to hold true; Jennie Phipps reports that her local Panera enjoys "an amazing business -- always full of people during the day."
Here in Portland, the Panera across the street from my children's pediatrician seems to always have a few tables full, even in the middle of the afternoon. But busy it's not, and I am personally no fan of their overly-sweet pastries which display little in the way of bakery prowess. The independent bakeries sell goodies for similar prices, and they're actually baked on site from scratch. I never get the feeling the Panera Bread employees know their sponge from their proof.
I see Panera's success as a fluke, not evidence of brilliant strategy; and predict the press around the company's growth -- with its spotlight on Panera's $16.99 lobster sandwich -- will only affect it negatively. Are you still going to Panera? Will you after today's news?
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Reader Comments (Page 1 of 7)
8-18-2009 @ 7:53PM
Fk said...
Now wait a minute! You mean when talking about Barak the unemployment rate is always less than reported but when talking about a successful company it's more than is reported?
Gad! Is there ANY truth in the news media anymore. Well, I mean of course, outside of the Wall Street Journal and Fox News.
Yada, yada, yada ...
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8-19-2009 @ 5:01AM
g, said...
Are you just joking? I thought everyone knew that.
8-18-2009 @ 8:01PM
Kathy said...
I love Panera. We only have Atlanta Bread in our small town in South Carolina. There is no comparison even though they are owned by the same company. AB's salads have no taste and they NEVER vary the menu. Each and every month it is the same menu. Panera's salads vary every season and have so much more taste. I sincerely wish they would come to our town!!!! Whenever I am in a town that has a Panera I go several times during my visit!!!
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8-18-2009 @ 9:15PM
john said...
That is common many people think they are the same company but panera and ab are not owned by the same people at least on a corperate level .Some may be owned by the same franchisee
8-19-2009 @ 12:05AM
Laughing said...
No you dumb ass, it means 100% of the people in the country don't work even when there is 0% unemployment. Retirees, the disabled, children. 50% or more of the population. You GOP sheep have been spoon fed bullshit by the party for so long your brains don't even click on anymore.
8-19-2009 @ 6:28AM
Martha said...
Atlanta Bread isn't owned by Panera. I'm 100% sure of this. I like the rest of your comment.
8-19-2009 @ 1:11PM
Dan said...
Atlanta Bread is not the same company as Panera Bread. They are two completely different companies.
8-18-2009 @ 8:06PM
Beth said...
We seldom go to Panera anymore. They have made their portions smaller, their prices higher, and the service is abyssmal at best (at the location in Ramsey, NJ). Forget it if you ask for one deviation from the menu -- they always get it wrong. They're just not worth it.
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8-18-2009 @ 9:12PM
hrrecruitmis said...
just about everything in NJ is worse than the rest of the country. I lived there and am GLAD to be out. Taxed, overcrowded, idiot drivers, corrupt politicians, and the sun is in your eyes in each way of the commute to NYC.
8-18-2009 @ 8:08PM
ran264 said...
I never did like Panera and can't understand what others see in it. They are way overpriced vs. quality, plus the serving sizes are little compared to other similar businesses. I can't believe people flock there just for the free wi-fi and the food. I think it's just people that still work that want to be seen there because they think it is a status statement that one has money. Panera is the last place I would go to eat.
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8-18-2009 @ 8:11PM
ran264 said...
wow, it sounds like the one in Vienna, WV
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8-18-2009 @ 8:15PM
fergstr said...
Panera bread is not as good as the prices they charge
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8-18-2009 @ 8:34PM
Margaret Soutar said...
I have been a loyal customer of Panera for a long time, since before they arrived in NYC and still go there for the value and quality of their food. The salads are huge and great tasting and their sandwiches are the best. I buy the French Baguette all the time for home made Italian food and always get compliments for the bread.
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8-20-2009 @ 6:27AM
Mujahid Aleem said...
Wow! I don't know where some of these people work or live but the towns next to mine have Paneras and my wife and I have our date nite there every Wednesday evening. The workers are friendly, knowledgeable and always helpful. Yeah, its a little pricey but what isn't that has value? You usually get what you pay for and quite a few folk seem to keep coming which suggests that we tend to agree. I never thought of it as a status symbol but just a great place to get some basically good sandwiches and salads and the few desserts I have tried were tasty. Overall, I would give them a 4 out of 5 for getting it right. Sorry you don't live where I do-- western Massachusetts.
8-18-2009 @ 8:18PM
Maddie said...
I live in Fort Wayne, Indiana and our Panera by the mall is always busy. Personally, I don't care for Panera. I remember one time I was there I bought a grilled cheese sandwich and the cheese wasn't even melted, I took to the back and they put it back on the grill. Still didn't melt! They had too many slices of cheese on it and the bread was really thick so of course it wasn't going to turn out right.
They're soup isn't too bad, but the bread they serve with it never tastes fresh and it tastes like cardboard.
Needless to say I never go there, except when I'm carpooling with my older sister, and I either take the apple she gets with her meal or I get a fruit cup when they are available. Their food quality isn't worth the price.
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8-18-2009 @ 8:22PM
Barista said...
Not only does Panera overprice, underportion, and treat their customers badly, they treat their employees like dirt. I'm so glad I got out when I did and went to work for a company that actually cares.
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8-19-2009 @ 1:06AM
d said...
Where would that be after 33 years in the work force I have yet to find a company that remotly cares about employees.
They expect you to give 100% but they put you out like the trash the moment you dont.
8-18-2009 @ 8:27PM
Ruby said...
I tried this place w/ a guest when it opened in Dublin, CA. We both had some fancy chicken sandwich. It was so awful. We both felt bloated the whole day. The ingredients were old, especially the chicken. It was so overpriced for what we got. I've never gone back. I pass by every time I shop at Target or Safeway and wonder who on earth would go back when there are other alternatives that offer value and freshness. Must be many first-timers. They have an outdoor patio, but I never see anyone eating out there.
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8-18-2009 @ 8:28PM
Dac said...
Panera breads are over priced, some are very good, others are nothing special. I can pay less at my local bakery and have the same quality if not better. I could not see going there for lunch. It is the Friendly's Ice Cream type menu and expensive for the portions.
So they won't reduce the prices; well, they are in it for the dough!
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8-18-2009 @ 8:31PM
shannon said...
I hate Panera, especially when I worked for them as a baker. The bread comes in par-baked, the muffins are pre-mixed batter, the soups are pre-made (just heat in the bag in boiling water), and the "pastries" are nothing more than stale bread with some sweet flavoring addded. The people who work there are rude, unattentive, and never smile. The managers are always under pressure to beat the previous year's sales and keep costs down (FYI.. Panera does NOT carry Worker's Comp insurance. If you have your own insurance, you have to use that). They're called the Starbucks of the bread world..overpriced and not worth it.
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