Panera Bread 2011 Annual Report Download - page 10

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quality products, and a warm, friendly, comfortable environment. It calls for each of our bakery-cafes to be a place customers can
trust to serve high quality food. Bread is our passion, soul, and expertise, and serves as the platform that makes all of our other
food special.
We believe our competitive strengths include more than just great food at the right price. We are committed to creating an ambiance
in our bakery-cafes and a culture within Panera that is warm, inviting, and embracing. We design each bakery-cafe to provide a
distinctive environment, in many cases using fixtures and materials complementary to the neighborhood location of the bakery-
cafe as a way to engage customers. The distinctive design and environment of our bakery-cafes offer an oasis from the rush of
daily life, where our associates are trained to greet our customers by name and have the skills, expertise, and personalities to make
each visit a delight. Many of our bakery-cafes incorporate the warmth of a fireplace and cozy seating areas or outdoor cafe seating,
which facilitate the use of our bakery-cafes as a gathering spot. Our bakery-cafes are designed to visually reinforce the distinctive
difference between our bakery-cafes and other bakery-cafes and restaurants. In addition, we believe that our MyPanera® loyalty
program, which we rolled out in the fiscal year ended December 28, 2010, or fiscal 2010, allows us to build deeper relationships
with our customers and entice them to return to our bakery-cafes.
Our menu, operating systems, design, and real estate strategy allow us to compete successfully in several segments of the restaurant
business: breakfast, "AM chill", lunch, "PM chill", dinner, and take home, through both on-premise sales and off-premise Panera
Catering®. We compete with specialty food, casual dining, and quick-service restaurant retailers, including national, regional, and
locally-owned restaurants. Our competitors vary across different dayparts. We understand people choose restaurants depending
on individual food preferences and mood. Our goal is to be the first choice for those customers craving soup, salad, a hot sandwich,
or a hot or frozen drink.
Panera Catering is a nation-wide catering service that provides breakfast assortments, sandwiches, salads, soups, and bakery items
using the same high-quality, fresh ingredients enjoyed in our bakery-cafes. Panera Catering is supported by a national sales
infrastructure, and we believe it represents a meaningful growth opportunity for our business.
Menu
Our value-oriented menu is designed to provide our customers with fairly priced products built on the strength of our bakery
expertise. We feature a menu containing proprietary items prepared with high-quality, fresh ingredients, including our fresh from
the field romaine lettuce and tomatoes and our antibiotic-free chicken, as well as unique recipes and toppings designed to provide
appealing, flavorful products that we believe our customers crave.
Our key menu groups are daily baked goods, including a variety of freshly baked bagels, breads, muffins, scones, rolls, and sweet
goods, made-to-order sandwiches on freshly baked breads, hearty, unique soups and side items, freshly prepared and hand-tossed
salads, and custom roasted coffees and cafe beverages, such as hot or cold espresso and cappuccino drinks and smoothies.
We regularly review and innovate our menu offerings to feature new taste profiles we believe our customers crave. We seek to
continuously improve our products, or develop new ones, such as our improved Turkey Artichoke Panini, premium Sonoma
Chicken Stew, and our Steak Balsamic Panini.
New product rollouts are integrated into periodic or seasonal menu rotations, referred to as “Celebrations”. Examples of products
we introduced in fiscal 2011 include the Thai Chopped Chicken Salad, an improved version of our Chicken noodle soup, and our
Wild-berry Smoothie which were launched in the first Celebration of 2011. The Steak and White Cheddar Panini, Steak and Blue
Cheese Chopped salad, and Steak and Egg Breakfast Sandwich were also added to help build on the success of our lunch and
breakfast entrees in our second celebration. In our third celebration of 2011, our popular seasonal Strawberry Poppyseed with
Chicken returned to our menu along with the Frozen Strawberry Lemonade. In our fourth celebration, we introduced a completely
revised version of our Turkey Artichoke Panini and our new Turkey Cranberry Harvest Salad, which featured antibiotic-free turkey,
along with a new Pumpkin cookie and Chocolate Babka bread. In our final celebration of the year, we introduced the Steak
Basamico Panini and our new premium Sonoma Chicken Stew.
We believe our menu innovation is one reason our value scores with customers remain so strong. Zagat’s 2011 consumer-generated
National Restaurant Chains Survey for eating on-the-go rates us number one among chain restaurants with fewer than 5,000
locations in the Best Salad and Best Facilities categories while ranking us among the top five in the Best Value, Best Grilled
Chicken, Top Service, and Best Breakfast Sandwich categories.
Operational Excellence
We believe that operational excellence is the most important element of Panera Warmth and that without strong execution and
operational skills, it is difficult to build and maintain a strong relationship with our customers. To develop a strong connection