A Panera Bread sign hangs on the exterior of the restaurant on July 25, 2025 in Miami, Florida. Joe Raedle | Getty ImagesWhen Panera Bread began shrinking its sandwiches and skimping on salads, it started shedding customers.Now, to win them back, the chain plans to reinvest in the business and undo many of those same cost-cutting measures, it said Tuesday.Once the number one fast-casual brand in the U.S., Panera has dipped to number three, ceding the top spots to Chipotle Mexican Grill and Panda Express. Last year, its sales fell 5% to $6.1 billion, according to Technomic estimates. For years, the chain’s traffic has been shrinking, according to CEO Paul Carbone, who took the reins earlier this year. Controversy after the chain’s foray into energy drinks didn’t help matters, either.Panera’s troubles have coincided with a tough year for fast-casual restaurants. Chipotle, Sweetgreen and Cava have all cut their full-year forecasts as they see younger consumers eating out less frequently.Carbone has a plan to bring back customers. Under the strategy, named “Panera RISE,” the company aims to refresh its menu, focus on value, improve its service and build new restaurants. He said the plan has the backing of the franchisees who operate roughly half of its 2,200 U.S. locations, along with the support of JAB Holding, the investment arm of the Reimann family that owns the company.Panera’s slide has been poorly timed for JAB. The firm has been plotting an IPO for the chain’s parent company Panera Brands, which also owns Caribou Coffee and Einstein Bros. Bagels.In 2021, four years after taking the chain private, JAB struck a deal with Danny Meyer’s special purpose acquisition company for a merger that would take the company public again. But Panera scrapped those plans a year later, citing market conditions. In late 2023, the company confidentially filed for an initial public offering that still hasn’t happened.When asked about the status of Panera’s IPO plans, Carbone told CNBC that the chain’s management team is currently focused on growing traffic and implementing the Panera RISE strategy.Entering the value warsPhase one of Panera’s plan is to improve the quality of its food, reversing cost-cutting measures imposed in the face of high inflation, according to Carbone.”We squeezed food costs. We squeezed labor,” he said.Some of those changes happened while Carbone was chief financial officer. He now calls himself a “reformed CFO” — albeit one who still listens to earnings conference calls.”It’s really about death by a thousand paper cuts, it truly is,” Carbone said about the chain’s downturn.Take Panera’s salads, for example. In the summer of 2024, Panera began using a mix of half romaine, half iceberg lettuce to make its salads, saving the chain money compared to when it was using romaine alone. This summer, it reverted back to entirely romaine salads.”You know what guests told us? No one likes iceberg, and no one gets that and says, ‘Oh my God, that white salad, it looks so appetizing,'” Carbone said.And then there’s the cherry tomato. Carbone said Panera is one of the few restaurant chains that doesn’t slice the bite-sized tomatoes in half, a decision made to save on labor costs.”We make the guest chase the cherry tomato around the bowl,” he said.And when a salad comes with an avocado, customers have to cut the halved fruit themselves, rather than it coming pre-sliced. The chain will start slicing the cherry tomatoes and avocados early next year.Plus, Panera’s salads typica …
