Panera Bread Testing The 'Pay What You Want' Model
from the trying-it-all-out dept
Popular restaurant chain Panera Bread has long been interested in experimenting with smart new business models. It was one of the first restaurants out there to push free WiFi in all its locations — at a time when many thought fee-based WiFi was the future — noting how much it helped bring in more business for the food. A bunch of folks are now submitting the news that Panera is testing out a pay what you want model in one of its new restaurants. There are “recommended” prices — but you can pay more or less than those numbers. This seems to be a take on the trend that became popular last year of restaurants offering certain days or nights where you could get free meals, which some restaurants found actually resulted in much more revenue (along with more loyal customers).
While I’m intrigued with how this will work out, I’m not convinced it’s going to be a success (though I’d be pleasantly surprised to find out I’m wrong). The whole thing is actually set up separate from Panera, via a non-profit foundation, which Panera is supporting. The restaurant won’t use the Panera name, but St. Louis Bread Co. Cares, which apparently was the company’s original name. I would guess that many people will feel guilty enough to pay the list price, though some will obviously pay less. I doubt very many (if any) people will really pay much extra, which puts the operation in a tricky position. Since we’re talking about food and salaries, there are real scarcities to deal with in terms of expenses, so a “pay what you want” model seems like it would have difficulty scaling.
Still, as business models go, it’s one worth watching.