Wondering what the Panera Bread franchise cost is? Wonder no more as we show you what the bottom line number is. We’ll also guide you with the steps you need to take to start your own bakery-café, fast-casual restaurant.
The Panera Bread Franchise Cost
In 1980, a small cookie store had been born in Boston, Massachusetts. Founder Ron Shaich expanded the business with the help of the late Louis Kane of the French bakery chain, Au Bon Pain. The two ventured further with the acquisition of the St. Louis Bread Company. They later revamped the business with the name change to Panera as well as delectable additions to their menu.
Today, Panera Bread has 2,043 bakery-cafes around the world. It has generated a revenue of $6 billion as of 2018 and employs approximately 100,000 employees globally. Its primary competitors are Chipotle, Wendy’s, Dunkin’, and Taco Bell, to name a few.
To be considered for a Panera Bread franchise, investors must have a net worth of $7.5 million. They also must have a liquid asset of $3 million and experience in operating a multi-unit restaurant. Panera Bread does not offer franchises for single unit restaurants. Instead, they require franchisees to open multiple (at least 15) bakery-cafes in a market area in 6 years.
Breakdown of the Costs
Estimated Initial Investment
Name of Fee
Low
High
Franchise Fee
$35,000
$35,000
Real Property
Varies
Varies
Leasehold Improvements
$402,000
$1,855,000
Equipment
$308,000
$452,000
Technology Systems (Optional)
$0
$172,000
Fixtures
$48,000
$154,000
Furniture
$49,000
$156,000
Consultant Fees
$35,000
$211,000
Supplies and Inventory
$19,000
$25,000
Smallwares
$28,000
$62,000
Signage
$18,000
$97,000
Additional Funds (3 months)
$175,000
$245,000
ESTIMATED TOTAL
$1,117,000
$3,464,000
Other Fees
Type of Fee
Amount
Royalty
5% of net sales
National Advertising Fund
2.6% of net sales
Local Advertising Funds
2% of net sales
Marketing Advertising Fee
0.4% of net sales
Advertising Association
Determined by the Advertising Association
Miscellaneous Administrative Fee
Determined by the franchisor from time to time
Proprietary Ingredients
For the dough, price is not to exceed 27% of “Retail.” For other Proprietary Ingredients, the price is established by the supplier from time to time
Licensed Ingredients
Prices are established by approved suppliers from time to time
Other Food Products and Supplies and Distribution Fees
Varies
Quality Control Program
Varies
Re-Inspection Fee
$3,500
Interest on Late Payments
2% over prime rate
Fee for Insufficient Funds in bank
$30 (bank fee plus administrative fee)
Fees to Evaluate and Approve Alternative Suppliers
The franchisor’s reasonable costs and expenses, ranges between $2,500 and $7,500, costs could exceed depending on the product and the proposed alternative supplier
Audit
Cost of audit ranges between $30,000 and $70,000 assuming the franchisee has maintained adequate books and records
Site Selection Costs
Expected to range between $1,500 and $4,000
Insurance
Varies depending on the circumstances
Maintenance Costs
Varies depending on the circumstances
Attorney’s Fees and Other Costs
Varies depending on the circumstances
Indemnification
Varies depending on the circumstances
Transfer
$7,500 plus cost
All Optional Panera IS Services
Varies
Panera IS Proprietary Enterprise Software, eLearning and Back of the House PC Hardware, and System Training Fees
Varies depending on the circumstances
Optional Charting Services
Not yet determined
How to Start Your Panera Bread Franchise
Aside from the abovementioned criteria, Panera Bread requires franchise applicants to have infrastructure and resources to meet their development schedule. You also must have experience in real estate, specifically in the market area you want to develop. In addition, you must have a passion for fresh bread and pastries and a full commitment to the development of the Panera Bread brand.
