I am puzzled because the inside of Panera stores are very well appointed. Good quality furniture, lots of baking equipment and display cases, great counter appearance, good size stores, good service from the large number of employees working. The food quality is also very good. I think based on what I get for what I pay for it is excellent value proposition for the customer. It just seems a little strange why a franchisee would sell the stores back to the company at such a low price of the franchise stores were profiable.
It would be nice if someone could provide insight.
If the Indiana stores are older and not in "hot" locations, they may be worth less than in the East where population densitys are higher. Some stores in SE Michigan are of modest size in strip malls. It has been noted on this board that ~4,400 sq ft is the size range approved by the management. I know from experience that not all stores are doing a booming business all the time. The $1 million number may reflect both local conditions and a prior agreement,
Not that I want to get into the argument about what the stores are worth, but most PNRA's I've seen are in mini-malls which are usually owned by Reits and therefore leased long term. Why would anyone want to put all their up front money into the real estate which has a very low rate of return? If someone has access to the full Edgar online the answers can probably be found.