Case 8: Panera Bread Company in 2011—pursuing growth in a difficult economy
This case study provides information regarding the past performance, current analysis, stock valuation, market evaluation, and industry comparison. In this analysis and case study, The following key elements comprise the Panera Bread strategy:
1. Capitalize on market potential by opening both company-owned and franchised Panera Bread locations as quickly as possible. Management planned to expand the number of Panera Bread locations by 17% annually through 2010 and to achieve EPS growth of 25% annually. The addition of the franchising option to the strategy has proven to be key in acquiring desired ...view middle of the document...
Case 3: Competition in energy drinks, sports drinks, and vitamin-enhanced beverages
The huge increasing in soft drink consumption has not happened by chance. It is due to different reasons. These reasons can be divided into internal ones and external ones. Following is the lively chart and analysis.
1. Real Prices Decline
Although cola and other soft drinks’ retail prices are rising slightly from 1970 to today, the prices after inflation-adjusting are really lower. They are due to the cost controlling, including mass purchase of raw materials, the marketing channels accumulating and so on. So folks can afford the cheap drinks easily to taste the new or chill themselves in the hot days or even quench their thirst. These unhealthy drinks are not more expensive than the common water but make people feel good by the ingredients.
2. Real Per Capita Disposable Income Stabilize
Disposable income (DPI) is total personal income minus personal current taxes3. Most people thought their income had been increasing steadily. Was it true? Or did it happen to everyone? The answer is NO. The U.S. Bureau of Economic Analysis (BEA) uses the average dollar value in 2005 for inflation adjustment. The first chart shows both the nominal per capita disposable income and the real (inflation-adjusted) equivalent since 2000. Year-over-year disposable per-capita income is up a meager 1.45%. But if we adjust for inflation, it is only up 0.43%.
3. New Products
As mentioned above, the soft drink industry can adjust the direction and endeavor in innovation when the life style changes. When people improved their health consciousness, diet cola and other vitamin drinks came out. When people did more excises and hiking, the energy drinks came out. Folk concept changing and new products coming out is the major reason for soft drinks increasing.
Soft drink companies spend billions on advertising. Much of these marketing efforts are aimed at the people who like sports and children. Their efforts have paid off. The whole soft drink industry is booming.
The war between Coke and Pepsi has played a substantial role in both companies’ profits. As the competition increased, and as each...