Panera Bread Company Essay
Executive Summary This report targets what Panera Bread Company (PBC) has to do to become profitable, provide healthy and quality foods to customers and first and foremost retain it is leadership possibilities in the restaurant and fast food business. The report also looks at what organization’s vision and quest statement means.
It touches strategic objectives by dealing with strategy ingredients, analysis and implementation. Company governance must be used to shift the functions of PBC, analysis of both the micro and macro environmental parts of view with the organization – where market, socio-cultural, political/legal, technological and global things to consider of the organization in question. In addition, it dwells upon strength, weaknesses, opportunities and threats which includes studying pattern analysis from the organization. Porter’s five makes model, concept of strategy groups, resource primarily based view, double bottom line confirming, value sequence analysis and financial examination would have to be examined seriously so as to produce PBC have competitive advantage over the rivals.
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Based on the above ideas in this statement, it is hereby recommended that PBC must: •open fresh markets and establish divisions in other countries simply by targeting major cities and towns applying same criteria, quality, menu, site assortment and building. •develop much healthier and top quality foods, one of a kind brands, regularly be ahead of opponents and try to work with trend examination to know the lifestyles of men and women, tastes, maintain steadily its corporate cultural responsibility with stakeholders, take a look at marketing mixture, develop it is technological base and have a genial atmosphere in their several cafes including motivating employeesIf these advice are applied, it is assumed that PBC will take up more than 30% of the business within the next couple of years. 1 . Introduction1.
1The is designed of the report•how PBC may reposition the leadership edge by ensuring the management ideas remains particular, opening up franchises, encourage transparencies in management procedures and be proactive in terms of modify and enhancements. •how PBC can sustain its growing profit and growth amounts. 1 . 2Objective of the report•how PBC can easily ensure consistency in their eye-sight, mission and strategic goals by using significant processes like strategy evaluation, strategy formula, implementation and company governance•Analyzing the micro and micro conditions of PBC •Using Porter’s five causes model and concept of strategy groupings to generate PBC possess competitive advantage over their particular competitors. •Using resource basic view and value-chain examination to identify likely opportunities and threats intended for PBC. installment payments on your Background of the CompanyPBC is known as a market head in the restaurant industry business.
Started business in 81 with 3 bakery coffee shops, bookstores and by 1997, their food handling business cafes had been 160 with branches in five countries and restaurants in domestic airports and hotels. PBC’s concept is to sell simply fresh bread and no preservatives. Their quest is ‘a loaf of bread in every arm’ with 18 distinct products. It intends to determine Wi-Fi get in the year 2003, and has its own awards in the kitty.
They have a good division network, business operations, supervision information system and supply string management and highly professionalized staff. The 2004 initial quarter performance showed a boost of 26% over same period in 2003 using a highly priced stocks. 3. Case Study AnalysisStrategies are set of actions that companies use to attain its objective. While strategic management centers where a company is at present and exactly where it expects to be in the foreseeable future.
The task of analyzing a firm’s internal and external environment and selecting the right strategy is called strategy ingredients. Strategy implementation involves putting ideal controls and organization components to keep the company’s selected strategy into action. Eye-sight statement may be the long run dreams of the corporation while mission statement means what is expected of the organization by their stakeholders. This report concentrates on micro-macro environment of PBC in order to preserve their leadership role, boost market share and profitability.
Reference Based Look at, Porters five forces model, strategic groups, value cycle, SWOT and financial analysis including double bottom line confirming, and how these concepts will help the PBC to be a market leader will be analysed. a few. 1Macro EnvironmentMacro economic elements are personal, socio-cultural, environmental, economic, technical and legal. 3. 1 . 1Political considerationPBC has to maintain its corporate governance issue by making sure that taxation are paid out promptly and study federal government policies since it affects the company.
At the moment politics consideration isn’t a big problem with PBC but since it hopes to expand its businesses, government polices of countries that wants to conduct business would have to be examined to see if it is organization friendly or perhaps not. three or more. 1 . 2Demographic forcesAreas that are less rewarding by the agencies should be closed down and move to areas that raises profitability (Hill et ‘s 2004). There is significant growth to get young people and children who also rarely cook at home and in addition they patronize these kinds of fast casual restaurants.
These youths concern their health by eating healthy and balanced and quality foods which PBC should target pertaining to high profitability. 3. 1 . 3Socio-cultural factorsIncreases in the human population of women in workplaces happen to be massive and higher levels of health consciousness have created a boom to a lot of industries (Campbell et al 2006). PBC should study population demographics, income circulation and life styles changes within their areas of operation to their advantage. 3. 1 ) 4EnvironmentalOperating environments have to be friendly.
This should done in such a way that company social responsibility to communities in terms of polluting of the environment, waste disposal and environmental protection laws happen to be adhered to (Johnson et approach 2005). Right now it operates ‘Operation Dough Nation’ in which all funds received and unsold stocks goes back to the community this operates. a few. 1 . 5Economic factorsAlmost all of the industries are prone to general monetary conditions. Large interest and exchange rates, and typical disposal salary can affect agencies to greater extent (Campbell et approach 2006).
At this time business is definitely booming pertaining to PBC, so that it has to consider business periods, product developments, interest rates, pumpiing and also throw-away income of shoppers in order to have a competitive edge. 3. 1 ) 6TechnologicalThis is actually a global sensation in virtually every business. For any company to remain competitive it has to enhance their technological bottom to take on rivals (Campbell et ing 2006). PBC is broadening its technical base by simply introducing point of deal machines and credit cards network at each café.
This helps in planning for promoting information, item mix, more rapidly accounting details and other variance analysis. a few. 1 . 7LegalJohnson et ‘s (2005) remarked that organizations must be cautious of health and merchandise safeties, work laws and legislations. Considered its operation operations to organizations, it has to make sure that organizations’ it enters into deals comply with the standards, quality, menu, internet site selection and construction of cafes. The education program structured by the corporation prior to franchisee starting business is congratulated. 3. 1 . 8GlobalChanges in the environment just like political and economic have formulated a business increase to some countries, while some include witnessed states as a result of this.
Government guidelines and changing cultural habits by consumers have had a good impact in a few industries although some are unhappy with these types of changes (Hill et al 2004). PBC should research these alterations and find out those kinds that influence their business especially intra-country deals where they should convert values of their department companies overseas. 3. 2SWOT AnalysisThis displays the internal pros and cons of an business from the customers’ point of view as they relate to external opportunities and threats (Hannagan 2002). a few.
2 . 1StrengthStrengths of organizations are the fully commited leadership zeal of managers, experience in the industry, clear and articulate series with external stakeholders, solid product design and style and determination to buyers in the area of innovation (Lee ain al 1999). The talents or primary competencies PBC has at the moment over the competitors are the product, syndication and franchising, operations, marketing mix, standard managerial potential and low personnel yield. 3. installment payments on your 2WeaknessesThese may be in the form of zero clear supervision styles, poor image, r and d issue, competitive disadvantage, poor track record, insider problems, financing problems and possible teaching problems by simply managers and supervisors (Dess et al 2007).
PBC has to purchase research and development, increase its image with stakeholders and improve on its sales strategies. 3. installment payments on your 3OpportunitiesThe developing demand for healthful and quality foods can be an opportunity that PBC features at the moment over its competitors and it has to be sustained for making them have got continuous major role in this industry (Stead et al 2004). Managers of PBC should analyse competitive causes in the cafe sector to be able to identify the different opportunities with regards to product development and new items, create new markets and prediction of trends. three or more.
2 . 4Threats: What makes a business to be good is to determine possible hazards within its operational foundation. The risks could be in the form of government procedures, research, competitive pressures, new entrants, changing customers preferences, adverse demographic changes, economic depression, growing negotiating power of suppliers and consumers (Dess ainsi que al 2007). PBC has to lay particular focus on new traders, watch sector indicators, federal government adverse plans and within customers needs and preferences. 3. 3Resource based viewThis considers the opportunities available to a company both to add worth to usana products and providers or look at ways of lowering costs (Dess et approach 2007).
It may be possible to add value to the value chain of an business in terms of procurement of recycleables and creation processes. The current system that PBC is using wherever it has authorized agreement with Dawn Foods and also having economic of scale regarding supplies makes the pricing with their product very competitive. several. 4Porter’s five force market competitionPorter’s five force sector competition are the threat of recent entrants, the bargaining benefits of suppliers, the degree of rivalry amongst competitors inside the same market, the negotiating power of customers and the hazards of alternatives products.
Avoir argues the fact that stronger these kinds of forces happen to be within an industrial setting the more limited corporations raise prices and earn greater earnings (Campbell 2006). As far as this can be concerned a strong competitive pressure can be thought to be a danger because it would drastically decrease the profit of an organization (Williamson 2004). several. 4. 1The threat of substitute productFirms within the same industrial setting are competitive amongst themselves. Substitutes limitations potential returns on an market by placing a ceiling within the prices businesses charge.
This will be a wide range of concern intended for PBC because there are lots of agencies offering same product in the market. 3. four. 2The menace of new entrantsWhen new entrants enter the market they tend for taking extra work in order to take full control over the market. The degree to which fresh entrants may enter a market exerts an important influence on the degree that companies may well act to earn above average in terms of bottom line (Johnson et al 2005).
At the moment PBC enjoys some element of financial systems of level, brand recognition, access to distribution channels and experience in carrying out functional activities resulting in lower cost of production. But it really is good for new entrants to the market as this brings about competition in the industry. three or more. 4. 3The power of buyersBuyers are seen as competitive risks when they are capable of demand affordable prices or better service. More over when purchasers are poor, a company can easily raise its prices and declare larger profits (Johnson and Scholes 2002). It has to be taken into mind by PBC following volume of restaurants around.
PBC will need to recalculate the costs as it intends to increase prices simply by 2% to find the justification just before embarking on that. 3. some. 4The benefits of suppliersSuppliers can be viewed threats when they are able to force up the value for raw materials or lessen quality of materials.
Yet , if suppliers are weak, companies can easily force down their prices and require higher raw material top quality. PBC feels it can include cost savings via switching to Dawn. several. 4. 5Rivalry among set up companiesIf competition is fragile this will lead to increase in prices of products at the detriment of consumers and finally increase earnings and vise versa (Johnson 2005). PBC should on a regular basis study competitors’ moves. a few. 5. Value Chain Analysis (VCA)VCA allows managers to know how properly and proficiently the activities of their organizations are structured and coordinated.
In other words, it seeks to provide a comprehension of how much value an organization’s actions add to usana products and solutions compared to the costs of the companies used in their very own production. It will help management to spot core activities, know if there is breakdown or perhaps blockages for their detriment (Tsai et approach 2006). The distribution network of PBC is good mainly because it uses a completely independent contractor that delivers goods to the bakery cafes and therefore making the corporation to put emphasis in the full operations. Their very own franchise functions should be sustained.
3. 6Strategic groupsPotter (1980) defined tactical (SG) groupings as group of firms in the same profession having identical strategy following through the tactical direction. Carroll et approach (1992) since cited in Flavian and Polo (1999) organizations in the same SGs often compete for market share. PBC provides a lot of businesses within the same SGs, and so should make use of this to their edge by understudying their opponents strengths and weaknesses. three or more. 7Tripple lower part lineThis is definitely the combination of sociable, environmental and financial reporting for an organization to it is stakeholders (Dess et al 2006).
PBC does not present its statement in this formatting, although this can be optional pertaining to organizations but for enable stakeholders understand PBC’s business better they should incorporate this into their report such as the Operation Money Nation plus the unsold inventory proceeds. 4Recommendation•Encourage research for new products and personalisation. •Explore associated with new limbs across region. •Improve promoting drive to improve sales as its closing products on hand in the year 2003 was $8066 million dollars as against $5191 , 000, 000 dollars in 2002. •Identify threats and weaknesses through strategic groupings•Pursue recovery of debts by debtors which will shows $9646 million in 2003.
Reduce its liabilities which provided $35, 552 million us dollars. •Plan pertaining to succession incase of likely changes in command hierarchy. a few. ConclusionIn realization, PBC should regularly search within the tiny and macro environments for signals of environmental changes or basic trends which can be occurring. About observing a trend which may lead to an industry changes, the business needs to keep an eye on the alter so it provides a better comprehension of the exact characteristics of the modify and if it is applicable to the organization.
In the event the monitoring mechanism suggests the change is relevant, then the firm needs to forecast how the modify will impact its businesses in future. It really is then necessary to assess the outlook implications to determine whether the marketplace change will demand a change in the company’s approach. Benchmarking, reengineering and total quality administration should not be omitted.. References Dess, GG, Lumpkin, GT, Eisner, AB 2007, ‘Strategic management’, 3rd edn, McGraw-Hill, Nyc.
Campbell, D, Stonehouse, G, Houston, B 2006, ‘Business strategy’, 2nd edn, Elsevier Butterworth-Heeinemann, Oxford. Stead, EW, Stead, GJ, Starik, M 2004 ‘Sustainable strategic management’, M. Elizabeth. SharpeInc., New york city. Tsai, YC, Fan, CRAIGSLIST, Liou, CN, Wu, CRAIGSLIST 2006 ‘The application of parts control and standardization by simply exploration of the value chain in new product creation and innovation’, The Business Review, vol. 6th, no . two, pp 213 (online Emerald).
Hanaagan, Capital t 2002 ‘Mastering strategic management’, Palgrave, Ny. Hill, CWL, Jones, GRMS, Galvin, P 2004, ‘Strategic management: a built-in approach’, fifth edn., David Wiley, Milton. Johnson, G, Schooles, K, Whittington, R 2005, ‘Exploring corporate strategy’, 7th edn, Prentice Hall, Harlow.
Williamson, D, Jenkin, W, Cooke, P, Moreton, KM 2005, ‘Strategic supervision and organization analysis’, Elsevier Butterworth-Heinemann, Burlington. Johnson, G, Scholes, T 2002, ‘Exploring corporate strategy’, 6th edn., Prentice Area, Harlow. Avoir, ME 1980, ‘Competitive strategy’, The Free Press, Ny