4 Innovation Lessons You Can Learn From Panera

I have had my eye on the Panera Cares café concept since its inception three years ago.  Would it be more than a cause marketing initiative or CSR campaign? Would it positively impact the communities it serves?  Would it be successful?  After hearing founder Ron Schaich’s present “Innovating Philanthropy: Panera’s Social Experiment”, I think the answer is yes to all of the above. In his presentation, he described his inspiration for Panera Cares cafes and the process of taking the idea and making it a reality.   What I walked away with (other than a good feeling about Panera) is a handful of lessons any nonprofit can use to help them innovate.

Study What Others Are Doing and Develop Your Own Approach

Ron knew he wanted to expand on the company’s philanthropic efforts, he knew he wanted to address hunger or food insecurity, but he didn’t know what he wanted to do until he learned about the SAME Cafe in Denver, Colorado.  He visited the SAME Cafe and many similar organizations to observe and learn how they deliver on their mission.   The result is the Panera Cares Café a “pay what you can” restaurant.  The menu lists suggested donation amounts, but every customer is served regardless of whether they are able to pay or not.  Ron took the concept of a community café and modified it to work for Panera.

Focus on the Experience  

Ron anonymously visited community cafes around the country as a customer.  He observed the total experience from the look and feel of the facilities to how diners hung their heads as they ordered.  He was motivated to create an experience in Panera Cares cafes that is “just as good as the one you pay full price for” at the retail store.   And, the experience is entirely Panera – as a guest at a Panera Cares Café you order off the same menu as a Panera retail store and the food, service and standards are all the same.  This was extremely important in order to create an experience that every customer would want and enable non-paying customers to “dine with dignity”.

Hone Your Skills, Perfect the Plan, Iterate Until It’s Right

When the first café opened in Clayton, Missouri Ron worked 80 hours a week running the café to learn and improve upon the initial concept.  He spent hours tweaking the way the café communicated the “take what you need, but leave your share” idea.  Initially customers ignored instructions because they didn’t understand the concept.  They have since modified their communications (it’s the “pay what you can” model) and added a greeter at the door to help walk customers through the process.  He also spent hours creating a custom “point of sale” system.  One that utilizes the technology to place the orders with the kitchen, but that totally and anonymously allows customers to give.  For any skeptics reading, Ron shared that 60% of the guests donate the suggested amount, 20% donate more and 20% donate less.

Don’t stop innovating!

Today there are 5 Panera Cares Cafes and they are all self-sustaining with money left over.  The Panera Cares Foundation is expanding and figuring out ways to do more.  In addition to addressing food insecurities, they are developing job training programs and focusing on at-risk youth.

Panera (the for-profit entity) has 1,652 bakery-cafes nationwide and had $2.1 billion in sales in 2012.  If you ask their employees, what their most proud of, it’s often Panera Cares.

Want more information on the “Experience” check out the Panera Cares reviews on Yelp.

3.5 Stars in Portland, OR  http://www.yelp.com/biz/paneracares-portland

4 Starts in Clayton, MO http://www.yelp.com/biz/paneracares-clayton

3.5 Stars in Dearborn, MI http://www.yelp.com/biz/paneracares-dearborn

3 Stars in Chicago, IL  http://www.yelp.com/biz/paneracares-chicago

4.5 Stars in Boston, MA http://www.yelp.com/biz/panera-cares-boston

Patricia Tynan

Sr. Marketing Manager

Read Full Post »

Endeavor Global: Leading Entrepreneurs to Transform Their Communities through Social Enterprise

Sage customer Endeavor Global has an incredible story and it starts with the vision and passion of Linda Rottenberg and Peter Kellner.  In 1997, Linda and Peter sat down and like many entrepreneurs sketched their vision on the back of a napkin. Endeavor would be a new kind of non-profit one dedicated to high-impact entrepreneurship.  They set out to identify and support entrepreneurs in emerging market countries, create jobs and change attitudes towards entrepreneurship. While Endeavor Global is a nonprofit organization, it is run in the model of a for-profit enterprise and its mission is to lead the global movement to catalyze long-term economic growth by selecting, mentoring, and accelerating the best high-impact entrepreneurs around the world. When you look at the key metrics, you quickly realize Endeavor Global’s model for solving the most urgent social crises in the world is exceptional.  Consider the following stats:

• Since 1997, Endeavor Entrepreneurs have created more than 180,000 high-quality jobs in 14 countries from Mexico to Lebanon.
• 73 Endeavor Entrepreneurs would qualify for Inc’s 500 list of fastest growing US companies.  They have an average growth rate of 59 percent in their first two years.
• In 2011, Endeavor Entrepreneurs raised $100 M in equity capital and generated $5 billion in revenues.
• Endeavor Entrepreneurs earn over $220 for every dollar donated to the organization!

How do they do it? Endeavor pioneered the concept of high-impact entrepreneurship in emerging markets. Believing that high-impact entrepreneurs create an inordinate number of jobs, Endeavor identifies and selects promising entrepreneurs, giving them access to the mentoring, networking, and strategic advice they need to thrive. Endeavor’s goal is to create high-value jobs, increase company revenues, and inspire future generations to become entrepreneurs and give back. Over 80% of their entrepreneurs contribute to their local affiliates and many serve as mentors to the next generation and on Endeavor boards worldwide.

The Compounding Effect and Return on Donated Capital (RODC)

Endeavor Catalyst is an innovative, passive investment pool that uses donated capital to co-invest in Endeavor Entrepreneur funding.  The main goal of the program is to harness the value creation of entrepreneurs to produce investment returns to support Endeavor Global’s operations and future ventures. Unlike the traditional model in philanthropy, Endeavor Catalyst compounds donor capital across multiple cycles.  Over a 20-year period, a $1m donation would result in approximately $9.6m in direct investments to Endeavor companies and $5m to Endeavor operations.  Endeavor would calculate this return on donated capital  – RODC – as a multiple of 14.6. As proceeds are recycled into new investments, initial donations generate ever-increasing funds for social impact, which can be measured as an ever increasing multiple on the original donor capital — Return on Donated Capital, a new impact measurement term introduced by Endeavor.  This graphic illustrates the power of RODC in the Endeavor model.

The result high-impact entrepreneurs create thriving organizations that transform a developing country, bringing jobs and generating millions in wages and revenues.   And just as importantly, they demonstrate the power to succeed while inspiring and mentoring countless others to create, produce and prosper. Together, these entrepreneurs, their investors and their support team hold the key to sustained economic growth in emerging markets. View Endeavor Global’s 2012 Impact Report and be inspired and excited about the future of social enterprise.

Read Full Post »