Panera Bread Company Essay

Executive SummaryThis report foc substance abuses on what Panera Bread Company (PBC) demand to do in order to be profitable, provide wellnessy and musical note foods to consumers and above totally withhold its leadership potentials in the restaurant and fast food business. The report also flavours at what compositions vision and mission disceptation means. It touches strategical objectives by dealing with dodge formulation, abstract and executing.Corporate nerve has to be used to reposition the operations of PBC, analysis of both the micro and macro environmental lays of opine of the organization where demographic, socio-cultural, policy-making/legal, technical and global considerations of the organization in question. It also dwells on strength, weaknesses, opportunities and threats including ingesting purport analysis of the organization.Porters five forces model, concept of dodging groupings, resource based view, triple empennage gillyflower reporting, value chemical chain analysis and financial analysis would wear to be examined critically so as to make PBC have competitive advantage over its rivals.Based on the above concepts in this report, it is hereby recommended that PBC has toopen new markets and establish branches in other countries by targeting major cities and towns using uniform standards, quality, menu, site selection and construction.develop more healthy and quality foods, unique brands, always be forrard of competitors and try to use trend analysis to know the lifestyles of people, tastes, maintain its unified social responsibility with s shamholders, look at merchandise mix, develop its technological base and have a friendly atmosphere at their various cafes including motivating employeesIf these recommendations be implemented, it is believed that PBC will occupy more than 30% of the market deal deep down the next few years.1.Introduction1.1The aims of the reporthow PBC target reposition its leadership edge by e nsuring the counselling concepts body special, opening up franchises, encourage transp bencies in management practices and beproactive in terms of channelize and innovations.how PBC bear sustain its rising profit and growth levels.1.2Objective of the reporthow PBC can ensure consistency in their vision, mission and strategic objectives by using major processes like strategy analysis, strategy formulation, implementation and corporate governanceAnalyzing the micro and micro environments of PBCUsing Porters five forces model and concept of strategy groupings to make PBC have competitive advantage over their competitors.Using resource base view and value-chain analysis to discern realistic opportunities and threats for PBC.2.Background of the CompanyPBC is a market leader in the restaurant industry business. Started business in 1981 with three bakery cafes and by 1997, their bakery cafes were 160 with branches in five countries and cafes in domestic airports and hotels.PBCs conc ept is to sell only fresh dough and no preservatives. Their mission is a loaf of starting line in e real arm with 18 different products. It intends to establish Wi-Fi access in 2003, and has many awards in its kitty.They have a good distribution cyberspace, franchise operations, management information system and supply chain management and highly professionalized staff.The 2004 first quarter performance showed an increase of 26% over same goal in 2003 with a highly priced shares.3.Case Study synopsisStrategies are set of actions that firms use to achieve its goal. While strategic management focuses where an organization is at present and where it intends to be in the future. The task of analyzing a firms internal and external environment and selecting an appropriate strategy is known as strategy formulation. Strategy implementation involvesputting appropriate controls and organization mechanisms to keep the companys chosen strategy into action. Vision statement is the long run a spirations of the organization while mission statement means what is expected of the organization by its stakeholders.This report focuses on micro-macro environment of PBC in order to retain their leadership role, increase market share and profitability. Resource Based View, Porters five forces model, strategic groupings, value chain, SWOT and financial analysis including triple fucking line reporting, and how these concepts would help the PBC to be a market leader would be lwee-weed.3.1Macro EnvironmentMacro sparing factors are political, socio-cultural, environmental, economic, technological and legal.3.1.1Political considerationPBC has to maintain its corporate governance issue by making sure that taxes are paid like a shot and learning government policies as it affects the business. At the arcminute political consideration is not really a big issue with PBC but if it intends to expand its operations, government polices of countries it wants to do business would have to be examined to cop if it is business friendly or not.3.1.2Demographic forcesAreas that are less profitable by the organizations should be closed eat and move to bowls that increases profitability (Hill et al 2004). Presently there is significant growth for young people and children who seldom cook at home and they patronize these fast casual restaurants. These youths are concerned about their health by eating healthy and quality foods which PBC should target for high profitability.3.1.3Socio-cultural factorsIncreases in the population of women in workplaces are massive and higher levels of health consciousness have created a boom to many industries (Campbell et al 2006). PBC should study population demographics, income distribution and lifestyles changes within their areas of operation to their advantage.3.1.4EnvironmentalOperating environments have to be friendly. This shoulddone in such a way that corporate social responsibility to communities in terms of pollution, waste disposal and environmental aegis laws are adhered to (Johnson et al 2005). At the moment it runs Operation Dough Nation where all monies received and all unsold inventories goes back to the community it operates.3.1.5Economic factorsAlmost all the industries are prone to general economic conditions. High liaison and exchange rates, and average disposal income can affect organizations to larger extent (Campbell et al 2006). At the moment business is booming for PBC, therefore it has to consider business cycles, product trends, interest rates, inflation and also useable income of consumers in order to have a competitive edge.3.1.6TechnologicalThis is now a global phenomenon in almost every business. For a company to remain competitive it has to enhance its technological base to compete with rivals (Campbell et al 2006). PBC is expanding its technological base by introducing point of sale machines and credit cards network at distributively caf. This helps in planning for marketing informa tion, product mix, quicker accounting information and other variance analysis.3.1.7LegalJohnson et al (2005) pointed out that organizations should be cautious of health and product safeties, employment laws and legislations. Taken into account its franchise operations with other organizations, it has to make sure that organizations it enters into balances comply with its standards, quality, menu, site selection and construction of cafes. The training program unionized by the organization prior to franchisee starting business is applauded.3.1.8GlobalChanges in the environment such as political and economic have created a business boom to some(a) countries, while some have witnessed economic recession as a result of this. Government policies and ever-changing cultural patterns by consumers have had a positive impact in some industries while some are unhappy with these changes (Hill et al 2004). PBC should study these changes and know those ones that affect their businessespecially in tra-country trades where they have to convert currencies of their branch companies overseas.3.2SWOT AnalysisThis shows the internal strengths and weaknesses of an organization from the customers point of view as they relate to external opportunities and threats (Hannagan 2002).3.2.1StrengthStrengths of organizations are the committed leadership zeal of managers, experience in the industry, clear and articulate line with external stakeholders, strong product design and commitment to consumers in the area of innovation (Lee et al 1999). The strengths or core competencies PBC has at the moment over its competitors intromit the product, distribution and franchising, operations, marketing mix, general managerial ability and low personnel turnover.3.2.2WeaknessesThese can be in the form of no clear management styles, poor image, inquiry and development issue, competitive disadvantage, poor track record, insider problems, financing problems and achievable training problems by managers a nd supervisors (Dess et al 2007). PBC has to invest in research and development, improve its image with stakeholders and improve on its marketing strategies.3.2.3OpportunitiesThe growing demand for healthy and quality foods is an opportunity that PBC has at the moment over its competitors and it has to be sustained to make them have continuous dominant role in this industry (Stead et al 2004). Managers of PBC should analyse competitive forces in the restaurant sector in order to identify the various opportunities in terms of product enhancement and new products, create new markets and prediction of trends.3.2.4ThreatsWhat makes an organization to be strong is to identify possible threats within its operational base. The threats could be in the form of government policies, research, competitive pressures, new entrants, changing customers tastes, adverse demographic changes, recession, growing bargaining causality of suppliers and customers (Dess et al 2007). PBC has to layparticular emphasis on new entrants, watch industry indicators, government adverse policies and changes in customers of necessity and tastes.3.3Resource based viewThis considers the opportunities available to a company either to add value to its products and services or look at ways of lessen be (Dess et al 2007). It may be possible to add value to the value chain of an organization in terms of procurement of raw materials and production processes. The present system that PBC is using where it has signed agreement with Dawn Food Products and also having economic of scale in terms of supplies makes the pricing of their product very competitive.3.4Porters five force industry competitionPorters five force industry competition include the threat of new entrants, the bargaining power of suppliers, the degree of rivalry among competitors in the same industry, the bargaining power of buyers and the threats of diversifys products. Porter argues that the stronger these forces are within an industri al setting the more limited companies raise prices and earn greater profits (Campbell 2006). As far as this is concerned a strong competitive force can be regarded as a threat because it would drastically reduce the profit of an organization (Williamson 2004).3.4.1The threat of substitute productFirms within the same industrial setting are competing amongst themselves. Substitutes limits potential returns on an industry by placing a ceiling on the prices companies charge. This should be a lot of concern for PBC because there are lots of organizations oblation same product in the market.3.4.2The threat of new entrantsWhen new entrants enter the industry they tend to take extra effort in order to take full control of the industry. The extent to which new entrants can enter an industry exerts a significant influence on the degree to which companies may act to earn above average in terms of bottom line (Johnson et al 2005). At the moment PBC enjoys some element of economies of scale, b rand recognition, access to distribution channels and experience in carrying out operational activities leading(p) to overthrow cost of production. But it is good for new entrants to enter themarket because this brings about competition in the industry.3.4.3The power of buyersBuyers are seen as competitive threats when they are in a position to demand lower prices or violate service . Conversely when buyers are weak, a company can raise its prices and produce higher profits (Johnson and Scholes 2002). This has to be taken into account by PBC following volume of restaurants around. PBC should recalculate its costs since it intends to increase prices by 2% to see the justification prior to embarking on it.3.4.4The power of suppliersSuppliers can be viewed as threats when they are able to force up the price for raw materials or reduce quality of materials. However, if suppliers are weak, companies can force down their prices and demand higher raw material quality. PBC believes it c an have cost savings from switching to Dawn.3.4.5Rivalry among established companiesIf rivalry is weak this will result to increase in prices of products at the detriment of consumers and ultimately increase profits and vise versa (Johnson 2005). PBC should regularly study competitors moves.3.5.Value Chain Analysis (VCA)VCA helps managers to understand how effectively and efficiently the activities of their organizations are structured and coordinated. In other words, it seeks to provide an understanding of how untold value an organizations activities add to its products and services compared to the costs of the services used in their production. This helps management to identify core activities, know if there is breakdown or blockages to their detriment (Tsai et al 2006). The distribution network of PBC is good since it uses an independent contractor that delivers products to the bakery cafes and thus making the organization to concentrate in the retail operations. Their franchise operations should be sustained.3.6 strategical groupsPotter (1980) defined strategic (SG) groups as group of firms in the same line of business having identical strategy followingthrough the strategic direction. Carroll et al (1992) as cited in Flavian and Polo (1999) organizations within the same SGs often compete for market share. PBC has a lot of organizations within the same SGs, and therefore should use this to their advantage by understudying their competitors strengths and weaknesses.3.7Tripple bottom lineThis is the combination of social, environmental and financial reporting for an organization to its stakeholders (Dess et al 2006). PBC does not show its report in this format, although this is optional for organizations but to enable stakeholders understand PBCs business better they should incorporate this into their report like the Operation Dough Nation and the unsold inventory proceeds.4RecommendationEncourage research for new products and branding.Explore the possibili ty of new branches across borders.Improve marketing drive to increase gross revenue since its closing inventory in 2003 was $8066 million dollars as against $5191 million dollars in 2002.Identify threats and weaknesses through strategic groupingsPursue recovery of debts from debtors which shows $9646 million in 2003. Reduce its liabilities which gave $35,552 million dollars.Plan for succession incase of possible changes in leadership hierarchy.5.ConclusionIn conclusion, PBC should regularly scan the micro and macro environments for signals of environmental changes or general trends that are occurring. On observing a trend that may lead to a market changes, the company needs to monitor the change so it has a better understanding of the exact nature of the change and whether it applies to the organization. If the monitor mechanism suggests the change is relevant, then the company needs to forecast how the change will affect its operations in future. It is then necessary to assess the forecast implications to determine whether the market change will require a change in the companys strategy. Benchmarking,reengineering and total quality management should not be left out..ReferencesDess, GG, Lumpkin, GT, Eisner, AB 2007, Strategic management , 3rd edn, McGraw-Hill, New York.Campbell, D, Stonehouse, G, Houston, B 2006, vexation strategy, second edn, Elsevier Butterworth-Heeinemann, Oxford.Stead, EW, Stead, GJ, Starik, M 2004 Sustainable strategic management, M.E. 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