Panera Bread 2004 Annual Report Download - page 5

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Our community of franchisees, JV and company operators is dedicated to development and operational excellence. They have a strong
local presence in their markets and exemplify the success that is achievable when a skilled operator is close to the customer.
Franchisees are essential to Panera’s growth and will continue to represent approximately two-thirds of our system. Our JV program,
which allows highly skilled operators of company stores to share in the value they help create, is also a key element of our growth.
We believe so strongly in our JV program that we expect that JV operators will represent the majority of our growth in company-
owned markets.
As we look to maintain our competitive advantage, Panera Bread is constantly exploring new ways to delight our customers through
our food, people, and environment. In the coming year, we plan to raise the bar on the quality and variety of our food, as we did with
our all-natural chicken in 2004. To that end, we are also significantly bolstering our product development and marketing teams,
including substantial investment in marketing research, and expect to see the results of that research in 2006.
Recognizing that the Panera Bread culture is a distinctive asset, we focus on ensuring that Panera Warmth is infused and nurtured
throughout our organization as we expand.
We continue refining and rolling out our G2 bakery-cafe design, which continues to position Panera Bread as the leader in innovative
design in our industry. Just as we have rooted ourselves in an artisan bread tradition, so have we developed an artisan-crafted
environment with G2, where bread is a central theme, as evidenced in our bread wall display and our original artwork. From the colors
and lighting to the furniture and open spaces, everything in G2 is designed to provide a gathering place where our customers always
feel welcomed.
Our ability to create different environments within one bakery-cafe allows our customers to enjoy Panera Bread for a variety of
experiences, whether it’s for a quick bite at lunch, gathering with friends in the afternoon, reading by the fireplace, or stopping in for
breakfast and browsing the morning news on our free WiFi.
We anticipate that our growth, expansion, and planned enhancements to the special experience that is Panera Bread will result in
another year of consistent growth and achievement of our earnings targets. In 2005, we are again committed to executing rapid
expansion and utilizing the scale inherent in our system-wide sales to drive operating margins. As we announced on February 16,
2005, our goal is to achieve our earnings-per-share target of $1.52–$1.57 per diluted share.
OUR THANKS AND OUR COMMITMENT
We continue to be deeply respectful of how our customers experience Panera Bread. Their positive response gives us great confidence
as we look to the future. However, it also holds us to a higher standard.
Our franchisees and our company and JV team members must continue to uphold these standards and work even harder at doing the
things that make Panera a very special place for our guests. I thank them for their commitment and willingness to engage in our shared
vision. On behalf of our entire management team, I thank each of our stockholders for their support and belief in us.
Team Panera takes seriously our responsibility to shepherd Panera Bread’s continued success. We understand what it takes to
accomplish this, and look forward to building this company into a truly significant enterprise that achieves its fullest potential.
Sincerely,
Ronald M. Shaich
Chairman and Chief Executive Officer