Shop Talk

Retailers, consumers and prices

Panera’s pick-what-you-pay cafe holds its own

July 28, 2010

panera2Panera Bread’s hometown experiment in altruism appears to be working.

About eight weeks after opening Panera Cares — a nonprofit restaurant that invites customers to take what they need and pay what they can — executives say it appears to be on-track to covering its costs and becoming self-sufficient.

“It’s a fascinating test of humanity,” Panera Executive Chairman Ron Shaich told Reuters.

“On average, we’re coming in around 85 percent of the average retail price,” said Shaich, whom Panera Bread’s CEO has dubbed the “guiding light” of Panera Cares.

St. Louis-based Panera Bread provides the space to house the experimental cafe, which is run by a nonprofit group that grapples with the same labor and food costs as any other restaurant.

Shaich hopes to open two more Panera Cares cafes before the year end, likely in other Midwestern cities or potentially in the Pacific Northwest.

During his two-week stint at the first Panera Cares cafe in Clayton, Missouri, Shaich said he saw a wide range of behavior from diners — who are given a receipt with the retail value of their food and the option to leave a donation.

Some generous souls left as much as $100, he said. But there were others who appeared not so generous, like the trio of college students who left a $3 donation for about $40 worth of food. 

While the occasional C-notes are great, they aren’t what will sustain Panera Cares, said Shaich, who is counting on the patrons who regularly do a little extra to help neighbors who are down on their luck: ”It’s the people who round up to the nearest dollar.”

(Photo provided by Panera Cares)

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