CAGR= (End Value/Begin Value) (1/# of years) -1
Total Revenue: 30.91%
Franchise royalties and fees: 21.87%
Fresh dough sales to franchisees: 24.85%
Net Income: 28.93%
EPS:
Basic: 26.25%
Diluted: 28.88%
Net cash provided by operating activities: 22.67%
Revenues at company-operated stores: 51.78%
Revenues at franchised stores: 58.09%
Revenues per company-operated bakery café: 7.54%
Revenues per franchised bakery café: 4.89%
If you notice, the above percentages that were calculated shows that Panera Bread is increasing in every part over that past 4 years. CAGR (Compound Annual Growth Rate) shows that there was a 31% increase in total revenue since 2002. Based on the income statements, Panera Bread’s performance is quite impressive – especially from franchised stores with a 58% increase. Panera Bread made a smart decision by not granting a single unit franchise but instead entering into agreements that made the developer open a certain amount of Panera Bread stores in a certain amount of time.
Panera Bread makes most of its revenues and profits from the company bakery/café operations. Even though there is more depreciation/amortization and expenditures for the bakery/café to maintain its operations, the revenue and profits well exceeds that amount.
Just by looking at the revenues and profits from 2006 alone shows that profit margins are particularly beneficial in the franchise segment. It may not be the most amount of revenue coming in but it has the least amount of money being taken to maintain it.
To help Panera Bread strengthen its competitive position and business prospects against other restaurant chain rivals, I believe they should start by opening more Panera Bread restaurants for better customer accessibility. They could also strategically place the restaurants in office locations. Most of the Panera Breads I have seen have been in strip malls and shopping locations. They could try stand alone building locations and put them...