Franchise Deep Dive: Panera Bread Franchise Costs, Fees, Profit and Data

The beloved fast casual restaurant brand does not sell single-unit franchises. Instead, franchise owners will need to develop an entire market, typically opening 15 bakery-cafes in a period of six years.

By Luca Piacentini1851 Franchise Managing Editor

8:08AM • 06/23/23

LAST UPDATED: May 22, 2023

FRANCHISE WEBSITE: https://www.panerabread.com/en-us/company/franchise-information.html

NUMBER OF LOCATIONS: 2,164

REPORTED COST TO GET IN: $1,117,000 to $3,464,000

REPORTED ROI (Item 19): $2,699,198 (2021 Panera Average Unit Volume)

Panera Bread is an American chain of fast-casual restaurants with over 2,100 locations, all of which are in the United States and Canada. With savory baked breads, soufflés and sweets, as well as a full offering of café fare — panini sandwiches, hand-tossed salads, delectable soups — Panera Bread draws a crowd from morning to night. In addition, the family-friendly, coffeehouse-type atmosphere in Panera Bread locations encourages customers to relax; sip coffee and chat; read; or work online.

How Many Panera Locations Are There?

In 1981, the first Panera Bread location was opened under the original name of Saint Louis Bread Company, as a cozy bakery-café nestled in Kirkwood, Missouri. The founders Ken Rosenthal and Ron Shaich were two childhood buddies who held an intense affection for the art of baking. A dozen years later, in 1993, they decided to rebrand the business as Panera Bread, setting in motion the opening of additional branches in St. Louis and neighboring Midwest cities.

The ensuing 10 years witnessed a rapid ascent of the company as it diversified across the nation, assimilated other businesses, and broadened its menu to include salads and sandwiches. Panera made a significant leap in 2001 when it acquired Au Bon Pain Co., Inc., catapulting its presence to more than 500 bakery outlets across the country. This merger also brought with it Au Bon Pain's renowned offerings like the tomato basil bread and the cinnamon crunch bagel.

By 2012, Panera had established itself as the predominant bakery-café chain in the United States, boasting a network of 1,800 outlets from coast to coast. In 2014, Panera unveiled its intention to go public, subsequently getting listed on the Nasdaq stock exchange with the ticker symbol PNRA. A year into being publicly traded, they augmented their business by acquiring Paradise Bakery & Café, a café chain native to Arizona, thus incorporating close to 100 more outlets into their already vast repertoire.

Currently, Panera Bread stands as a trailblazer in the arena of fast-casual dining, with an expansive footprint of over 2,000 bakery-cafés spread across 43 states and the District of Columbia.

What Is the Panera Business Model?

Panera Bread aims to be a digital-first cafe. The brand’s loyalty program MyPanera has the highest number of members in the retail industry, with over 40 million members. Its coffee subscription add-on has only helped to boost enrollment. Although off-premise orders are increasing in popularity, Panera Bread still believes in the importance of an elevated dining experience. The company announced last year that it is launching a new, more compact restaurant design, which features exposed ovens where customers can see Panera’s popular bread while it's baking.

Panera Bread does not sell single-unit franchises, so it is not possible to open just one bakery-cafe. Rather, the brand develops markets by selling whole areas, which require the franchise developer to open a number of units, typically 15 bakery-cafes in a period of six years.

Panera Bread franchises must be well-capitalized to open great bakery-cafes and meet this aggressive development schedule. Additionally, they must have a proven track record as excellent multi-unit restaurant operators to operate great Panera Bread bakery-cafes.

Qualification Criteria (Domestic):

Experience as a multi-unit restaurant operator
Recognition as a top restaurant operator
Net worth of $7.5 million
Liquid assets of $3 million
Infrastructure and resources to meet our development schedule
Real estate experience in the market to be developed
Total commitment to the development of the Panera Bread brand
Cultural fit and a passion for fresh bread

How Much Can Panera Franchise Owners Make?

A Panera Bread franchise makes $2,599,432 in sales per year on average. This figure is the average yearly sales of 1,099 Panera Bread franchised bakery cafes. The lowest sales for a store was $1,060,142 versus up to $5,113,281 for the most successful bakery.

Initial Investment (midpoint)	%Profit margin of average franchise sales	Estimated profits	Time to recoup investment
$2,290,500	12.5%	$337,399	8.25 years
	15%	$404,879	7.25 years
	17.5%	$472,359	6.5 years

How Much Does It Cost to Open a Panera?

The total investment necessary to open a Panera Bread franchise ranges between $1,117,000 to $3,464,000. This includes:

Category	Actual or Estimated Amount	To Whom Paid
Franchise Fee	$35,000	Panera
Leasehold Improvements	$402,000 to $1,855,000	Contractors
Equipment	$308,000 to $452,000	Equipment Vendors, Panera
Optional Technology Systems	$0 to $172,000	Panera
Fixtures	$48,000 to $154,000	Vendors
Furniture	$49,000 to $156,000	Vendors
Consultant Fees	$35,000 to $211,000	Architect, Engineer, Expeditor, etc.
Supplies and Inventory	$19,000 to $25,000	Panera and other suppliers
Smallwares	$28,000 to $62,000	Suppliers
Signage	$18,000 to $97,000	Suppliers
Additional Funds (3 months)	$175,000 to $245,000	Vendors, Suppliers, Employees, Utilities, Landlords, etc.
TOTAL	$1,117,000 to $3,464,000 (excluding real estate and related costs, and landlord allowances)

What Is the Franchise Fee for Panera?

The initial franchise fee is $35,000.

Who’s On Panera’s Leadership Team?

What Helpful Articles Can I Read to Learn More About Panera?

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