Panera Cares Proves People Care

Ronald Shaich is the founder of Panera Bread, the best performing restaurant stock when measured over the last decade. But that isn’t enough for Shaich, especially when 1 in 6 Americans live in “food insecure” homes. A few years ago, he was inspired when he saw a news report that covered Same Café in Colorado, an establishment that fed everyone at whatever price he or she could pay. Shaich began to study other models and became interested in “community cafés,” which were part of a powerful movement but the facilities were small and often operating out of the back of a church.

When Shaich began conceptualizing the Panera Cares Community Café – a pay-what-you-can model – he was determined to replicate the full Panera Bread experience. As the CEO of a public company, he had to fight an uphill battle with his shareholders to prove that it made business sense. Essentially it would be the same costs as his other stores but the net income was much harder to determine. To navigate this, they decided to create the Panera Foundation to cover the café’s expenses; Panera corporate’s gift to the foundation was the physical asset of the café. The two would operate as separate entities with full transparency. But how would the café actually work?

Shaich determined that the cafés had to be located in diverse communities, ones with both people who could afford to pay the suggested price and those who couldn’t. The idea is to empower people in communities to take care of each other. The cafés employ people on the lower end of the economic spectrum, which makes them more dedicated to the business, and the cafés even have a job-training program for at-risk youth. Instead of cashiers, payment is submitted in donation boxes in order to protect patrons’ dignity, something that proved incredibly important. People don’t want something for nothing and many lower income customers wanted to volunteer in order to get food.

So the big question is: does it work? One year after the first café opened in Clayton, MO, Shaich was proud to tell the audience at Sustainable Brands ’11 a resounding YES. About 20% of customers leave more money than the suggested donation with no pressure, and 20% pay less. There is now a café in Dearborn, MI and a third was recently opened in Portland, Oregon. Shaich hopes to open a new café each quarter.

Through this endeavor, Shaich has proven that humanity is good – that when you trust in people, they won’t disappoint. He claims that Panera’s transparency is the foundation for this trust. With such an important and inspiring message, it’s surprising that Shaich doesn’t promote this story on the company’s website and a Google search only reveals mention of it from the company through press releases.

During a panel at the conference, Shaich revealed that he struggles with publicizing doing good because then it seems like you only did it for the PR buzz. In the case of Panera Cares Community Cafés, I urge Shaich to rethink this. While I understand his predicament, his story is too important not to share as other companies need to learn from his innovative approach to integrated philanthropy.

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Ali Hart is a sustainable communications and engagement strategist with a passion for life’s essentials: food, water and storytelling. Her background in the Entertainment industry, penchant for humor and MBA in Sustainable Management from Presidio Graduate School are Ali’s secret weapons in her quest to master the art of behavior change and to make sustainability inconveniently fun.