New retail model promotes community equity
Posted April 5, 2011 at 1:25PM
Perhaps heralding a new trend toward what social observer Suzie Boss, writing in the Stanford Social Innovation Review, has called “retailing with heart,” a bakery and restaurant has begun offering its wares for whatever prices customers are willing to pay. And, yes, that includes nothing at all if that’s what they can afford. While the establishment indicates suggested values for its products and meals, it does not insist upon collecting on them.
It is, in a sense, placing its trust in the kindness of the community, in the notion that some customers will pay more than the suggested price because they are altruistic, while others will benefit from the subsidy by paying less; and that outright abuse of the system will be rare.
What I find especially significant is that this is the policy not of a lefty co-op but of a large national chain: Panera Bread, with 1400 restaurants across the country. So far, three of them have been designated Panera Cares outlets, in suburban St. Louis, in Dearborn, Michigan, and in Portland, Oregon. They are identical to the others except for the payment policy.
In a press release issued when the Portland branch opened, the company outlined the sustainability goals of its concept:
“Like the other community cafes, this location is easily accessible via public transportation and attracts an eclectic mix of customers, exuding a genuine neighborhood vibe . . .
“Panera Cares is a new kind of cafe – one that exemplifies an entirely different way of giving back. It is a community cafe of shared responsibility. One of the goals of this charitable program is to ensure that everyone who needs a meal gets one. People are encouraged to take what they need and donate their fair share. There are no prices or cash registers, only suggested donation levels and donation bins.
“’The vision for the Panera Cares cafe was to use Panera’s unique restaurant skills to address real societal needs and make a direct impact in communities,’ said [company co-founder and chairman Ron] Shaich. ‘Thus, the [Panera] Foundation developed these community cafes to make a difference by addressing the food insecurity issues that affect millions of Americans.’”
Boss reports that patrons have responded favorably, with about 60 percent paying the suggested price, 20 percent paying more, and the rest taking a deduction. Paul Bellew, writing in Shopper Culture, cites a report that the company hopes to expand the concept to every community in which it operates.
Simon Mainwaring sums the significance of the initiative in his We First blog:
"Even if the Panera Cares Cafes come out behind financially in the short term, the brand itself will come out way ahead. Such a powerful demonstration of concern for the well- being of the entire community in the way it engages both affluent and less affluent customers is simply smart business that contributes to meaningful change. What it demonstrates is a commitment to the well being of society as a whole over the long-term rather than a one-off marketing strategy designed to merely benefit the bottom line."
Nordstrom, according to Suzie Boss, may be the next national chain to start retailing for charity: the upscale clothier will reportedly open a unique store in the SoHo neighborhood of Manhattan this fall, with all profits going to charitable causes. Nordstrom, though, apparently does not intend to brand the store as its own.
Here’s a short video on Panera Cares:
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