Panera Bread Extending Pay-What-You-Want System To More Locations

Panera Bread is trying out a pay-what-you-want system that will allow customers to determine what they believe is a fair price for fresh-made food.

The pay-what-you-want experiment has already been going on for three years at certain locations. Now, the St. Louis-based bakery and sandwich chain announced that it would be extending the concept to all 48 of its cafes in the St. Louis area.

The catch is that the pay-what-you-want system only works on a single menu item, the Turkey Chili in a Bread Bowl. The system might be in part a promotion to bring attention to the new item, which features all-natural, antibiotic-free turkey along with vegetables and beans in a sourdough bread bowl.

Proceeds from the sale of the turkey chili will go to St. Louis-area hunger initiatives, but Panera officials see it as a two-fold benefit. Those in need in the city have the chance to get the 850-calorie meal, a nearly a day’s worth of nutrition, for whatever they can afford.

“We hope the suggested donations offset those who say they only have three bucks in their pocket or leave nothing,” said Ron Shaich, founder, chairman and co-CEO of the chain and president of its charitable arm, Panera Bread Foundation.

The company has gone a step further in its pay-anything experiment with another venture, Panera Cares. The company has opened these cafes in a handful of cities, with all menu items are under the pay-what-you want system and funded by donations. Roughly 60 percent of the customers pay the suggested retail price, with the rest evenly split between those paying more and others paying less.

“We don’t want this to be self-serving,” Shaich said. “We want to make this an intellectually honest program of integrity.”

Panera’s pay-what-you-want system has already been tested and found successful in other industries. The band Radiohead tried the system in 2007 for its album In Rainbows, asking listeners to come up with their own price. The attempt was deemed a success.

If Panera customers don’t like the pay-what-you-want system, they can always go with the ticket price for the turkey chili — $5.89 (tax included).