In this unit, we have talked about how companies try to set up barriers to entry in their markets. Apparently, a Panera Bread bakery in a Massachusetts mall wrote into their contract that no other sandwich shop could open in that mall. They then used that clause to try and stop a Mexican burrito place from opening in the mall.
This leads into a court having to rule whether a burrito is a sandwich. The court ruled in favor of the burrito place saying that a burrito is not a sandwich.
(Source: Greg Mankiw's Blog)
Subscribe to:
Post Comments (Atom)
8 comments:
Haha this is the lamest court case i have hear dof in a while. I like many other Moe's and Willie's enthusiasts clearly know the answer to this case. A burrito is NOT a sandwich. I can't even believe Panera tried to overrule them on this one. I think it is stupid first of all that Panera was able to sign a contract limiting other sandwich shops from entering the mall because I just thought that any space available was open to a leaser. Obviously the mall must approve of the store first though. When was the last time you put black beans, guacamole, sour cream, cheese sauce, RICE, and an assortment of other items on a sandwich??? Thats what I thought. I know that I never have. The burrito place probably doesn't even have any other choice of wrappings other than a tortilla or nothing at all(naked burrito). Panera doesn't have nachos, burritos, or quesadillas on their menu. They need to just suck it up that they will be going out of business soon b/c of this burrito place though. Sorry Panera, this is a lame argument.
I agree with however wrote that comment... Panera should have known that they were going to lose that battle. When you ask someone what they want on their sandwich you might expect a reply of turkey or ham, but i have never heard of anyone asking for a sandwich with black beans and chicken. Though Panera is clearly trying to weed out competition in order to create a more monopolistic situation for themselves, they should realize that burritos and sandwiches are as close of substitutes as they were trying to make them. The way I see it, you are either in the mood for sandwich/salad or a quesidilla/burrito. Sure Qdoba might pull away some of Panera's customers just by the fact that now the consumer has more options. In fact, instead of trying to claim that their sandwiches are the same as Qdoba's burritos, they should try to differentiate the products. They aren't really selling the same kind of food so why are they acting like it? I think that Panera was just worried about the competition and didn't want to have to spend more money on advertising, so they tried to find a loophole. Even though i like Panera,unfortunatly, now they just look ridiculous and power hungry (no pun intended).
-Natalie-
I would say that panera makes a pretty good argument. in our society how different is Moe's from subway?..in mexico burritos probably are treated like PB & J's. Now this also seems like a great job by panera to form a legal monopoly in the mall. If its in the contract i wold be pissed because in my point of view there is very little difference...
- wiles
according to dictionary.com, a sandwich is "two or more slices of bread or the like with a layer of meat, fish, cheese, etc., between each pair" or "something in horizontal layers." a burrito does not quailfy as either of these. a burrito is not in between two pieces of anything. a burrito is a wrap. Panera is ridiculous, while very tasty. I agree with natalie in that panera is probably just worried about competition. so if panera really wants the burrito place gone, then they need to change their contract so that all other food places are removed, because those also take away from their revenue. but who wants to eat at panera everyday. you could get sick of it and you will probably lose a lot of money, considering it is pretty pricey. think about the people who work in the mall and that is the only food that they can eat at lunch. panera is silly.
-carolyn daniel.
I think most businesses would try to find a way to keep business out if at all possible. That is why oligopolies form cartels to seem more like monopolies profit wise. The burrito restaurant, on the other hand, was wise to find the loophole in the "no other sandwich restaurant" clause. A burrito is defintely not a sandwich, just like steak is not chicken. The word sandwich is not vague enough to include all possible lunch items from all countries spanning the world. Panera, interestingly enough, chose to decide that a burrito is a substitute for the sandwich, when they could be differentiating their product more by telling the people in the mall how much more filling and delicious their sandwich is than any burrito. Maybe that is what the Panera will do, considering the restaurants really do carry two entirely different sets of food choices.
-Kate Vanderlip
This is by far one of the weirdest stories...The fact that Panera would fear competition so much that they form a kind of agreement like that is ridiculous! Since they want no competition, it only shows how lame and scared they are of a little rivalry. It only shows how they lack the inicitive to try their hardest. With that agreement, it allows them to slack instead of reaching their highest potential. I think that the whole concept of this contract or whatever they have with the mall is almost as ridiculous as the arguement itself. And NO a burrito is not a sandwich! Idiots.
-Veronica
Although it is legitimate that Panera doesn't want competition with other sandwich shops in the mall, they can not rule out any food with bread and something inside of it. That is ridiculous. Everyone knows that sometimes you are in the mood for Mexican food and other times you want a good old fashioned sandwich. They are two totally different things, and in my opinion a burrito is not a substitute for a Panera sandwich. Any other restaurant in the food court will be competition for Panera, so excluding a burrito place just because they have a similar product (in Panera’s opinion) is not worth it, you may as well just say no one else is allowed to sell food here.
-Hope
Post a Comment