Forget Uber Eats, Panera Bread Launches its Own Delivery Service

Panera store front

It seems like every day, a restaurant brand announces they have partnered with a third-party delivery service like DoorDash, Postmates or Uber Eats to expand its on-demand delivery in a certain market. 

Panera Bread, on the other hand, has made the conscious decision not to partner up with one of these delivery providers and instead, announced last week that the chain now offers national delivery at all stores in 897 cities and 42 states in the U.S.

Customers can use the Panera app to get their lunch or dinner delivered directly to their door for just a $3 delivery fee in most markets. 

“Panera delivery isn’t a pilot program. It’s not in just a few test markets. We now offer delivery across the country,” said Blaine Hurst, Panera CEO in a recent press release. “Delivery is fueling our next phase of growth, and the success we have seen so far is exciting. The combination of providing clean food options via an entirely digital experience is giving us a real advantage, and the momentum is just beginning.”

According to Panera, 30% of sales are made online, via kiosks, or through the app. The chain is aiming to increase that number and has hired 13,000 delivery drivers.

Currently, Panera has 2,000 stores and is known for being tech-savvy with its popular mobile app and loyalty program, along with its massive employment of self- service kiosks within the last few years. 

In April 2017, the chain was purchased by JAB Holdings for about 7.2 billion. It appears as though, JAB is aiming to keep Panera Bread ahead of the tech curve by now offering national delivery.

Not to mention, the chain's popular mobile app has helped the brand harvest valuable customer data. So why give that away to a third-party vendor?

"Panera, which says more than 31% of its sales are currently digital, representing $1.75 billion in revenue last year--which also includes online pickup and kiosk orders--decided its trove of customer data represented an opportunity to learn about and target customers they were unwilling to share," writes Barrons.

The chain was also the largest provider of free Wi-FI in the U.S. back in 2006 and 2007, meaning there has been a lot of customer data collected over the years.

Panera Bread was one of the first fast casuals to reign in the market. Although the chain has had success in the retail market with its soups and sides, in the recent years, the stores have struggled to compete in the saturated fast casual market now filled with hundreds of innovative concepts.

Will national delivery help the chain reach its revenue goals? 

Read more about Panera's delivery program at INC. 

As Uber Eats’ fees continue to increase, we will see more restaurants developing their own online-ordering and delivery platforms.

On the recent episode of The Barron Report below Host Paul Barron argues that Uber Eats has become a pricy partnership for operators and a new feature the delivery app is testing will likely cost operators more money.