Analysis of Panera Bread Competitors

Analysis of Panera Bread Competitors

Analysisof Panera Bread Competitors

PaneraBread is a chain of restaurants that operates in the fast foods orSpecialty Eateries industry. As such it is possible to compare PaneraBread with hundreds if not thousands of different other companies.However, in order to simplify the analysis, comparison will be madeto Domino’s Pizza Inc, Dunkin Brands Groups Inc, and StarbucksCorp.

Ihave chosen these three companies because they tend to fight witheach other in terms of customers, employees, costs, advertising,products offered, profits, market capitalization, growth, and mostimportantly pricing strategies. However, although Panera Bread isstill making headways in the market it still faces competition fromtraditional food chains, specialty food chains, pizza parlors,bakeries, restaurants, street vendors, and casual dine restaurants.

AsPanera makes its foothold in the market, it is facing stiffcompetition from other established companies such as Starbucks. WhilePanera Bread will easily compete with Dominos or Dunkins in terms ofmarket capitalization this might not be the case for Starbucks.However, current market trends are hard to describe or predict. Forinstance, within a relatively small span of time Apple was able togrow and become the most valuable company in the world. Thishappened, while there were companies within the consumer electronicsmarket such as Google and Microsoft, which had more capital thanApple.

However,within the last year, it is possible to note that in terms of marketcapitalization, Panera Bread was almost at par with dominos andactually had a higher market capitalization than Dunkin brands. Inaddition, it was clear that Panera Bread was able to compete withindustry leaders when it came to key profitability ratios.

Unfortunatelyfor Panera, McDonald’s, the largest player in the fast foodindustry recently introduced premium sandwiches and salads which wasmore of a unique product for Panera. Starbucks’s products alsodirectly compete with products from Panera Bread especiallybeverages. With Panera trying to setup dining places that also act aspopular meeting places it is directly competing with the kind ofsetting offered by Starbucks.

Paneramainly loses out from the bigger players when it comes to marketcapitalization and advertising budgets. Well established and largeplayers such as McDonald’s and Starbucks have higher advertisingand operating budgets meaning that they are more likely capable ofoutselling Panera Bread. On another level, Panera is at risk oflosing its employees in case they are offered better deals by thecompany’s competitors as they try to adopt its mode of operations.

CONCLUSION

PaneraBread continues to operate profitably even with growing competition.For instance, Panera bread has a higher five-year revenue growth thanmost of its competitors meaning that the company’s style ofoperations is profitable. However, the greatest advantage that thecompany has and that prevents it from directly competing with themain competitors is the company’s product niche. The artisan fastfood or the fast casual niche is not common in the specialty eateriesor fast food markets and this sets the company apart from its keycompetitors. This niche involves provision of healthier foods whencompared to traditional fast food outlets. In addition, it offersfast services compared to restaurants. This aspect attracts customerswho would have opted to dine in a restaurant but do not have thetime. Lastly, the many restaurants offering this kind of service arepredominantly local and do not have a national brand name or have alarge advertising budget.

WorksCited

Harrison,Jeffrey S, and John C. H. St. Foundationsin Strategic Management.Mason, Ohio: South-Western Cengage Learning, 2010. Print.

Michman,Ronald D, and Edward M. Mazze. TheFood Industry Wars: Marketing Triumphs and Blunders.Westport, Conn: Quorum, 1998. Print.