Panera Bread

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Panera Bread

• Steven Button
• Rebecca Hurney
• Jerry Liberatore
• Mindy Snyder

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Table of Contents

• History of Panera Bread- Rebecca
• What is Economics?- Rebecca
• Factors of Production- Rebecca
• Demand- Mindy
• Supply- Mindy
• Opportunity Cost- Mindy
• Substitution Effect- Steve
• Patent- Steve
• Price Discrimination- Steve
• Oligopoly- Jerry
• Product diversification- Jerry
• Conclusion- Jerry

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History of PaneraThe time of bread was dawning
in america

• This name change reflected the vision and focus
  of the expanding company.
  
• Today, Panera ranks as one of the top growth
  companies in the food service industry.

• The company was originally formed in 1981 under
  the name au bon pain Co., Inc. And grew
  internationally.
  
• In 1993, Au Bon Pain purchased St. Louis Bread
  co.
  
• Then, in 1998, the au bon pain co., decided to
  build the original company into a national brand
  named Panera Bread.
  

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What is Economics?

• Economics is the study of how individuals and
  societies deal allocate scarce resources to
  satisfy unlimited wants and the development of
  methodologies for analyzing such problems.

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Factors of Production

• Land
• Labor
• Capital
• Entrepreneurship

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Factors of Productionfor Panera

• Land- The Land on which their 414 Cafes reside
  on
  
• Labor- The 2,478 full time workers and 2,371
  part time workers that make up Paneras labor
  force
  
• Capital- The training necessary for Paneras
  employees and the 79,693,000 in Plant equipment
  owned
  
• Entrepreneurship- the 3.5 million spent in
  advertising costs to market their product
  

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Supply

• Supply is the relationship showing the various
  amounts of an item that sellers are willing and
  able to make available for sale at various
  possible alternative prices, during a given
  period of time, Ceteris paribus.

p
s
q
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Ceteris paribus factors for supply

• Input Prices
• p of flour, s of panera bread
• Prices of alternative goods
• p of subway, S of panera bread
• Technology
• Number of ovens, S of Panera bread
• Number of suppliers in the market
• number of suppliers, S of panera bread
• Expectations of sellers

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Demand

• Demand is the various amounts of an item which
  buyers are willing and able to purchase at
  various possible alternative prices, during a
  given period of time, ceteris paribus

p
d
q
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Ceteris paribus factors for demand

• Income
• income, demand for panerad bread
• Price of related goods
• price of jelly, demand for panera
  bread
  
• Tastes
• taste for panera, demand for panera bread
  
  
• Number of consumers in the market
• number of consumers, demand for panera
  bread
  
• Expectations of consumers

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Opportunity cost

• Opportunity cost is the value of the best
  alternative (s) which must be given up in order
  to get something

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Examples of opportunity costs

• increasing supply of sourdough bread while
  decreasing supply of cinnamon raisin bread
  
• increasing supply of muffins while decreasing
  supply of cookies

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Substitution Effect

• AS the price of a good falls, the consumer
  substitutes that good in place of other goods
  whose prices have not changed.

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Substitution Effect

• Substitutes
• Atlanta Bread Company
• Loafers
• Subway
• Effects of Substitution
• These substitutes keep Paneras prices
  regulated.
  

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Patent

• A Temporary grant of monopoly rights over a new
  product or scientific discovery

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Company trademark

• The name panera bread is of great importance to
  the company and is registered with the united
  states patent and trademark office.

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Price Discrimination

• Charging different prices to different customers
  for reasons other than differences in cost.

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Price Discrimination

• Discount coupons are a form of price
  discrimination used by Panera.
  
• Panera offers discounts to customers who are
  willing to participate in surveys.

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Oligopoly

• A market structure in which a small number of
  firms are strategically interdependent.

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Panera is an Oligopoly

• There are a few other firms in the bakery/café
  market.
  
• Atlanta Bread Company
• Loafers
• Firms are dependant upon each other and realize
  their decisions will impact competitors.
  

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Product Diversification

• Product Diversification- reduces the risk to
  owners and spreads the firms source of income
  among several different alternatives.

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Panera and Diversification

• Panera displays product diversification by
  offering a huge selections of beverages,
  sandwiches, pastries, bagels, soups and bread.

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Conclusion

• Panera enjoys tremendous success, ranking as one
  of the top growth companies in the food service
  industry.
  
• System-wide sales are expected to increase over
  200 million dollars in 2002 from 2001.
  
• Panera Bread Company should enjoy great success
  in their future.

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Any Questions???
Any Questions ???