Monday, February 15, 2010

What's in Panera's oven, Grasshopper?

After Ron Schaich resigns this May as CEO of Panera Bread, maybe he’ll grow a long white beard and sit atop a mountain somewhere, dispensing wisdom to chain execs who make the climb. Consider the profundities he uttered after Panera posted the sort of fourth-quarter results that would’ve prompted whispers of steroid use if this were baseball.

On the sales impact of operations: “Though operations are never given credit for driving sales, I am convinced we would not be having the success we are without improved operations,” said the Wise One. (That success, by the way: comp sales increases of 8.4% for company stores and 9% for franchised units for the first six weeks of 2010, even with bad weather depressing intake by an estimated 4%.)

On the zen of catering: “In my view our weakness in catering [during the first half of 2009] was a good thing. It forced our team to determine what really mattered in building catering sales.” Shaich noted to investors that 2010 catering sales are running 17% year to date above the comparable period’s for 2009.

On the addition of dinner-type items, like the new Mac and Cheese and a salmon-topped salad: “People often make this mistake. They think of the evening business as dinner. We don’t. We think of the evening business as lunch in the evening. Panera is never going to be in the business of serving what would be considered classically casual dining fare for date night.”

Shaich also offered a few glimpses into Panera’s future, including the introduction of a new customer loyalty program in company-operated units in April, and the possibility of licensing its name to retail products. He noted that a Panera-brand soup is already being sold on an experimental basis by Costco, one of 30 to 50 tests currently underway for the chain.

Thanks to for making available a transcript of Panera’s fourth-quarter conference call. It spared me from having to scale a mountain.


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