Business Case Studies & Business Publications

Panera Bread Company

Lipson, Marc L.

Case

Panera Bread Company

Lipson, Marc L.

F-1575 | Published December 31, 2008 | 7 pages Case

Collection: Darden School of Business

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Product Details

As 2007 drew to a close, Panera Bread Company faced a new challenge. To date, it had relied on retained earnings and minor equity infusions to finance operations. But a decline in margins would limit future financing from internally generated funds. Complicating matters was the fact that its stock price was at a historic low and management was contemplating a large equity repurchase. This case can be used to discuss multiperiod financial forecasts and the relative desirability of various financing sources. A teaching note and instructor and student spreadsheets are available.

The learning objectives are for students to generate a multiyear forecast of operations and financial needs, and to explore the nature of various possible financial sources. The case is an excellent introduction to financial strategy, and the forecast illustrates clearly the evolution of a firm’s financial needs.