Panera Bread business model and operations

Panera Bread

Product Life Cycle

There are various phases generally attributed to any product's lifecycle (Gorchel, 2010). There four phases of the product lifecycle are introduction, growth, maturity, and decline. These phases are necessary to understand in order to manage a product life from its beginning to end. This model could be best applied to the industry niche that Panera operates in rather than anyone of their products. Panera's niche is something of a hybrid between different restaurant service models.

Traditionally, the restaurant industry has consisted of two main sectors: full-service restaurants and fast-food restaurants. The fast-food sector typically serves foods such as hamburgers, chicken, sandwiches, pizza, Mexican dishes, and breakfast and snack items which can often be purchased through a drive through window. However a new niche is developing that offers food quickly in a sit down style environment. This industry niche is often referred to as fast casual and organizations, such as Panera Bread, have picked up on the trend and have brought the trend to the mainstream franchise market. This industry is most likely still in the growth phase as more and more consumers become familiar with the business model.

Market Segmentation

Panera bakes their own breads each morning and offers a variety of fresh salads, soups, and sandwiches. The quality of foods is higher than many of its competitors however the prices that Panera's offers are also substantially higher than traditional fast food establishments. Therefore Panera will typically draw a more professional crowd with higher disposable incomes. Furthermore, Panera's will likely appeal to the health conscious consumers over alternative establishments such as McDonalds because the quality of their foods is much higher and healthier. Thus Panera's will likely appeal to people that has a healthier lifestyle.