The suggested retail price for a steaming serving of turkey chili in a bread bowl at Panera Bread is normally $5.89. But customers ordering that menu item at cafés in St. Louis can now pay more, less … or nothing at all.
Panera’s pay-what-you-can model, part of the company’s charitable hunger-fighting initiative, was first tried in the St. Louis suburb of Clayton in 2010, but this week the company expanded it to all 48 cafés in the metropolitan area.
“We hope the suggested donations offset those who say they only have three bucks in their pocket or leave nothing,” said Panera founder Ron Shaich, whose cafés specialize in bakery items, sandwiches, salads, and soups. Profits from the program go to cover meals for customers who cannot pay the full amount or to local hunger-fighting programs.
While the St. Louis locations offer only a single menu item in the program, Panera Cares Cafés in Dearborn, Mich.; Portland, Ore.; Chicago; and Boston, allow customers to make a donation for any menu item. At those locations, people who can’t afford to pay can either receive their meal for free or contribute time and light labor in exchange for food. These cafés also offer a job-training program.
Kate Antonacci, project manager at the Panera Bread Foundation, said about 60 percent of customers at Panera Cares Cafés pay the suggested retail price. The remaining customers are about evenly split between those who pay more and those who pay less. Overall, these cafés generally bring in 20 to 30 percent less gross revenue than traditional café’s, but they still make a profit, she said.
If the limited-menu model works for Panera cafés in St. Louis, Panera may expand the program to some or all of its 1,600 locations across the country. But Shaich emphasized that there is neither a guarantee for countrywide expansion nor a timetable for a decision.
Panera isn’t alone in adopting the pay-what-you-can go model. One World Everybody Eats, a restaurant in Salt Lake City, adopted the idea 10 years ago. Café Gratitude, a small vegan café chain in California, offers a single item every day that can be purchased with a donation.
But the well-intentioned concept doesn’t always work. Yogaview, which operates three yoga studios in Chicago, tried a donations-only format at its Wicker Park studio for nearly two years before turning to a traditional payment method. Co-owner Tom Quinn said that while many customers were generous, too many others were not. “You’d get a class with six people and there would be 12 bucks in donations,” he said. “It got frustrating to see how some people weren’t owning up to it.”
But Shaich is optimistic. He said he’s seen well-to-do frat boys leaving without paying a dime, but more often, he saw people being generous.
“A lot of cynics think Americans are just gaming the system,” he said. “Our experience is very different. People do the right thing and are willing to take care of each other.”
The Associated Press contributed to this report.