Panera Bread 2004 Annual Report Download - page 4

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2
stable pricing to our company and franchise locations, while taking prudent measures to protect against price spikes to the degree
possible.
OUTSTANDING CUSTOMER LOYALTY
When we look beyond our past financial performance, we can best gauge our future by monitoring consumer acceptance of the Panera
Bread concept. We are gratified that Panera continues to win the highest industry rankings on every important consumer satisfaction
survey in which we have been judged.
For the third consecutive year, Panera Bread rated highest overall among 117 other chains in the Sandelman & Associates annual
survey of 67,600 consumers, which we consider to be the definitive measure of customer satisfaction within our industry. In fact, we
scored 22 percentage points above the all-chain average.
Panera Bread’s success in the Sandelman & Associates 2004 “Satisfaction Survey” comes on top of our number-one ranking in the
J.D. Power and Associates 2004 “Restaurant Satisfaction Study.” This study of 55,000 customers ranked Panera Bread highest among
quick-service restaurants in the Midwest and Northeast regions of the United States in all categories, which included environment,
meal, service, and cost.
For the third year in a row, Panera also earned a top spot in the esteemed “Choice in Chains” awards, sponsored by Restaurants and
Institutions magazine. The first-place award in the sandwich/bakery category recognized Panera Bread for high consumer rankings in
seven key areas including: food quality, menu variety, value, service, atmosphere, cleanliness, and convenience. We also received the
number-one ranking for food quality among 95 competitors included in the “Choice in Chains” survey.
In addition, Panera Bread’s Supply Chain leadership won Operations Executive of the Year, conferred by Baking & Snack magazine
for the company’s revolutionary fresh dough manufacturing and supply chain system.
2004 HIGHLIGHTS
Committed to seeking the highest-quality ingredients and best taste for our customers, in November 2004 we introduced a new, all-
natural chicken product for use in our salads and sandwiches. This chicken exceeds the USDA’s definition of all-natural: Our chicken
is raised on an all-natural, antibiotic-free, vegetarian diet in a stress-free environment. Although it costs the company significantly
more, we believe it is the best-tasting chicken available—and our customers clearly know the difference.
In 2004, we also witnessed the rollout of Via Panera®, bakery-fresh catering assortments from the Panera Bread menu. Via Panera
brings selections from the Panera Bread menu and the Panera experience off-site in attractive packaging for business gatherings, social
occasions, and other events. Now established system-wide, Via Panera is expected to continue to grow as customers become more
familiar with this option.
Operationally, we made great strides as well through a steadfast focus on quality of service—specifically, in friendliness, knowledge,
speed, and accuracy. Our operators improved speed of service, a constant priority, by more than one minute per transaction, year over
year.
Panera Bread reached another milestone in 2004, becoming the largest provider of free WiFi access in the United States, breaking
away from the traditional pay model. Currently, more than 600 bakery-cafes offer this service, allowing customers to surf the Internet
for free in the comfort of their local Panera Bread bakery-cafe.
LOOKING AHEAD
In 2005, our plan is for the growth of Panera Bread to continue its ambitious pace, while maintaining the quality of experience that has
earned national accolades from our customers.
For 2005, we are targeting 150 to 160 new bakery-cafes (70 company and 80 to 90 franchises), with the goal of approximately 900
bakery-cafes system-wide by year-end. Building on our success in southern California, Panera Bread is moving ahead with expansion
plans for northern California and the Pacific Northwest. Our plan for growth will put us on a schedule of celebrating a new bakery-
cafe almost every other day.