Panera plans to clear $7B in sales by 2028 in effort turn around earnings slump
Panera fell from the top fast-casual chain in the nation to number three in 2024
Quick service restaurant chain Panera Bread Company is launching a plan to clear $7 billion in sales by 2028 after a recent earnings slump.
According to data estimates from Technomic reported by Nation's Restaurant News, Panera Bread's sales fell 5.1 percent to $6.1 billion in 2024. The company fell to number three on the list of the nation's top fast-casual chains — just behind Chipotle and Panda Express — after enjoying the top spot for years, according to CNBC.
The new initiative to boost sales has been dubbed Panera RISE. The plan includes refreshing the menu, refocusing on delivering "value," improving customer service, and building new stores.
“Over the past year, we have made considerable progress in strengthening our foundation to better serve our guests," Paul Carbone, CEO of Panera Bread's parent company, Panera Brands, said in a press release. "Panera RISE is a momentum driver, grounded in the areas of differentiation that have made Panera an iconic brand for nearly 40 years."
Carbone took over as Panera's top executive earlier this year.
He said that the Panera RISE plan has the backing of franchisees who operate approximately half of its 2,200 U.S. locations.
The first phase of the plan is reportedly to include the restaurant's food quality and to reverse cost-cutting measures imposed in the face of high inflation.
“We squeezed food costs. We squeezed labor,” he said.
In one case of cost-cutting in 2024, Panera chose to start mixing its formerly fully romaine salads with iceberg lettuce to cut down on food costs. Earlier this summer, the restaurant returned to all-romaine salads.
“You know what guests told us? No one likes iceberg, and no one gets that and says, ‘Oh my God, that white salad, it looks so appetizing,’” Carbone told CNBC.
He also admitted that in other cases, the restaurant cut down on portion sizes while increasing the price of the item.
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“In some instances, we shrunk portions, so guests would walk into our cafe to buy a sandwich that has gone up significantly in price, with lower-quality ingredients, in a smaller size,” Carbone said.
In addition to improving quality, the chain is also going to introduce new items, including "fresca" and "energy refresher" drinks.
The company is also reportedly planning to invest more in its labor. In an effort to cut costs, Panera had scheduled fewer workers to man its stores, which saved money but left customers often waiting for someone to take their order as everyone was busy making orders.
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