Panera Goes Non-Profit, Seeks to Contribute to Charitable Organizations

RestaurantBriefing.com recently featured an article explaining how getting employees involved in local charitable organizations, fundraisers and other events benefited the restaurateur in greater employee loyalty and lower employee turnover rates. Panera has taken this concept a step further.

Top Performer, Panera takes Radical Turn
According to the company’s website Panera Bread was recognized in 2006 by The Wall Street Journal as the top performing restaurant in the area of one, five and ten year returns to its shareholders.  In fact, since 1999 Panera Bread stock has improved 13 fold, creating more than one billion dollars in shareholder value.

Although stellar in its performance, profitability and share returns, Panera Bread has decided to take a radical turn and opened a non-profit, pay-what-you-wish restaurant in Clayton, Missouri an experiment of Panera’s chairman, Rondal Shaich.

Non-Profit Draws Customers, Builds Loyalty
One month after opening its non-profit in Missouri, Shaich revealed that Panera will be able to cover its costs within a few months. The goal is to generate additional capital that can be used to help charitable organizations meet their goals.

As it turns out, nearly all the customers (between 60 and 70 percent) pay full price for the items they choose at the pay-what-you-wish Panera Missouri location. A small percentage pays a bit more and some pay less or nothing at all, but the concept is building a following and developing customer loyalty.

Creative Solutions
Restaurateurs are coming up with creative ways to attract customers who returned to their kitchens during the height of the recession. For some, this means offering discounts and coupons. Others have found that leveraging the power of social media networks to remain connected with customers is an effective solution. Still others have placed greater emphasis on being involved in community activities.

For Panera, they’re finding that creating a revenue stream to support their favorite charitable organizations is a win-win for all involved. .

Charitable Giving: Restaurant Employees Get into the Act

Supporting a charity or becoming involved in charitable events isn’t always an easy decision for business owners. Balancing the financial needs of the business with the desire to give to a local or national charity can be difficult.

The People Report is an organization that monitors human resource practices within the foodservice industry. Recently, The People Report released the results of a study they conducted which discovered that restaurants who give to charity and also offer flexible schedules for employees who participate in charitable activities experience significantly lower turnover among their staff.

Reducing Rate of Employee Turnover
Restaurants can do a number of things to encourage their employees to support local charities and to help make it easy for them to participate in charitable activities.

• Offer flexible schedules
• Allow for time off for charitable activities
• Invite suggestions on which charities to support

These methods show employees that their lives and interests beyond the restaurant matter and are important. And those employees who believe the company places value on them as individuals tend to develop a level of loyalty to the workplace and thereby reduce the rate of turnover.

Building Teamwork into Employees
Offering employees opportunities to volunteer in teams for a worthy cause creates a sense of camaraderie and develops teamwork naturally. These bonds make for happy employees who work well together.

The team-building experiences that occur while volunteering to support a worthy cause also establish the restaurants commitment to the community.  A study recently conducted by the Boston College Center for Corporate Community Relations discovered that 80% of employees believe it is important for a company to establish a good image in the community.

Attracting Employees in the Hospitality Industry
Cone Inc. sponsored a poll which found that 76% of Americans would accept the job offer from a company that supports charitable causes over a similar offer from a company who does not support charities. This means that supporting charities not only helps the business retain employees, but it also helps attract them.

Charitable Giving Supports Community, Attracts Customers

Throughout the economic downturn, restaurateurs have been forced to make difficult decisions in staffing, menu selections and charitable donations.  Determining the best way to balance the needs of employees, customers and the surrounding community with the financial demands of keeping a business solvent when times are tight is challenging to say the least.

Restaurateurs and Charitable Donations: To Give or Not to Give
For some, the answer has been to scale back on all fronts, including charitable giving. For others, charitable giving has become even more important. Those who have managed to continue supporting local and national non-profits have a few things in common:

• Commitment: Restaurateurs who give regularly share a commitment to the community and a recognition that though business may be down, others are also feeling the pinch of the economic downturn. For some, this commitment extends to national non-profits whose donations are down.
• Creativity: Another common trend among consistent givers is an ability to think creatively. Some restaurateurs raise significant capital auctioning meals for 10 in private homes. Others have created specialty drinks whose name or color is connected to a local or national charity and whose proceeds benefit the charity.

Return on Investment
Restaurateurs nationwide are coming up with surprising and inventive ways to support their favorite charitable organizations. And though the decision to do so typically did not start with a question of profits, many have found that working to strengthen the community has the added benefit of strengthening the restaurant.

Customers are attracted by the prospects of a fun evening out or a specialty item that benefits those in need. Gift certificate giveaways, private dinners and other donations promote the restaurant and allow the owner to highlight the facility, its food and its staff.

The Passion of Charitable Giving
The old saying that enthusiasm breeds enthusiasm seems true for charitable giving. Many restaurateurs have discovered that their passion for charitable giving is contagious as both employees and customers often promote the charity and the restaurant with abandon.