Panda Express - Why They're Successful
Summary
TLDRThe video explores the success story of Panda Express, the largest Asian fast-food chain in the U.S., with over 2,000 locations and $3 billion in annual sales. It attributes their success to factors like owning other restaurant chains, flexibility in adapting to various environments, a lack of competition, a menu that appeals to American tastes, early adoption of technology, being a private company, focusing on employee happiness, and charitable efforts through Panda Cares. The video also mentions the brand's immigrant founders, Andrew and Peggy Cherng, and their journey from a single Panda Inn to a global phenomenon.
Takeaways
- 🍽️ Panda Express is the largest chain of Chinese restaurants in the U.S., with over 2,000 locations and expanding globally.
- 📈 The company, Panda Restaurant Group, is owned by Andrew and Peggy Cherng, who are billionaires and immigrants from Taiwan and Hong Kong, respectively.
- 🏆 Panda Express's success is attributed to its ability to adapt its concept to various sizes and environments, including malls, standalone restaurants, and non-traditional locations like airports and military bases.
- 🔍 The lack of direct competition in the fast-food Asian food market has allowed Panda Express to grow without significant challenges from similar chains.
- 🍤 The menu at Panda Express is tailored to appeal to American tastes, with dishes like Orange Chicken and Honey Walnut Shrimp being particularly popular.
- 💻 Technology has played a significant role in Panda Express's operations since its early days, with the use of computers and point-of-sale systems for efficiency and inventory control.
- 🏛 Being a private company, Panda Express has avoided franchising and public ownership, allowing the founders to maintain control over the brand and its quality.
- 👩💼 The company places a strong emphasis on employee satisfaction, offering above-average pay and benefits, which is believed to contribute to better customer service.
- 🤝 Panda Express's charitable efforts, particularly through Panda Cares, have raised significant funds for children's hospitals, education, and disaster relief, enhancing the company's image.
- 📊 The company's growth strategy focuses on reinvesting profits rather than seeking external funding through franchising or public offerings, aligning with the founders' vision for the business.
- 🌐 Panda Express's expansion into international markets, starting with Mexico in 2011 and now including countries like Canada, South Korea, Japan, Russia, and the Philippines, demonstrates its global appeal.
Q & A
What is Panda Express and why is it significant in the fast food industry?
-Panda Express is the largest chain of Chinese restaurants in the United States, with over 2,000 locations, and it is part of the Panda Restaurant Group. It is significant because it has achieved remarkable success, with over 3 billion dollars in annual sales, making it one of the most successful restaurants in the world.
Who are Andrew and Peggy Cherng, and what is their background?
-Andrew and Peggy Cherng are the husband and wife team behind Panda Restaurant Group, which includes Panda Express. They are immigrants from Taiwan and Hong Kong, respectively, who met while studying mathematics at Baker University in Kansas. Andrew managed a restaurant owned by his cousin before opening his own restaurant, while Peggy worked in the Aerospace field and even coded for the U.S. Navy.
What was the initial concept of Panda Express and how did it evolve?
-Panda Express started as a traditional Chinese dining restaurant called Panda Inn. It evolved into a fast-food version of Panda Inn when the developers of the Glendale Galleria Mall asked the Cherngs to create a fast-food version for their food court. This new concept was named Panda Express to convey its faster service.
How has Panda Express adapted its concept to different environments?
-Panda Express has shown flexibility by adapting its concept to various sizes and environments, including shopping malls, standalone restaurants, airports, military bases, and sports stadiums. This adaptability has allowed the brand to operate in diverse locations, from hundreds to thousands of square feet.
What is the significance of Panda Express's lack of competition?
-Panda Express has benefited from a lack of competition, as it has operated in emerging markets for both fast food and Asian food without many comparable chains. This has allowed Panda Express to establish a strong presence and grow without significant competition.
What is Panda Express's stance on franchising and public company status?
-Panda Express is a private company and does not franchise significantly. The Cherngs prefer this approach to maintain complete control over their brand and operations, avoiding the potential quality issues that can arise with franchising or the pressure from investors that comes with being a public company.
How has technology played a role in Panda Express's success?
-Technology has been instrumental in Panda Express's success since its early days. The use of computers and a point of sale system from 1983 gave them an advantage in efficiency, inventory control, and understanding customer preferences, which contributed to their growth.
What is the 'Panda Way' and how does it influence the company's employee focus?
-The 'Panda Way' is a philosophy embraced by the Cherngs that emphasizes happy employees leading to happy customers. This approach has led to above-average pay and benefits for employees, encouragement for personal development, and a low turnover rate, contributing to the company's overall success.
What is Panda Express's charitable initiative and how has it contributed to the company's image?
-Panda Express established Panda Cares in 1999, focusing on raising funds for children's hospitals, education, and disaster relief. Having raised over 247 million dollars, this initiative has contributed positively to the company's image and customer perception.
What is the debate surrounding the authenticity of Panda Express's Asian cuisine?
-There is an ongoing debate about whether Panda Express serves authentic Asian cuisine. The company has made adjustments to its menu to appeal to American tastes and to facilitate quicker preparation, which has been effective but may differ from traditional Chinese dishes.
What are some of the other restaurant chains owned by the Panda Restaurant Group?
-In addition to Panda Express, the Panda Restaurant Group owns other chains such as Hibachi-San, a Japanese restaurant started in 1992, and has involvement in the franchise of Raising Cane's in Hawaii and Alaska.
Outlines
🍴 Panda Express: A Global Success Story
The script introduces Panda Express, highlighting its significance as the largest chain of Chinese restaurants in the U.S. with over 2,000 locations and international expansions. It delves into the history of its founders, Andrew and Peggy Churn, and how their immigrant background and diverse professional experiences contributed to the restaurant's growth. The narrative covers the early struggles, the strategic opening of the first Panda Inn in Pasadena, California, and the eventual creation of Panda Express as a fast-food variant in mall food courts.
📈 Flexibility and Market Position
Panda Express's adaptability and strategic expansion are emphasized, showing how the chain evolved from mall-based locations to various settings like airports and military bases. The segment discusses the lack of significant competition, noting how Panda Express capitalized on the emerging fast food and Asian cuisine markets. Comparisons with competitors like Manchu Wok and PF Chang's illustrate how Panda Express maintained its dominance and continued to grow.
🍛 The Menu and Technological Edge
This section highlights the popularity and adaptation of Panda Express's menu to American tastes, with items like the famous Orange Chicken. It also discusses the early adoption of technology by Peggy Churn, which provided the company with efficiencies in order processing, inventory control, and customer satisfaction. The narrative underscores how these factors contributed to the brand's success and customer loyalty.
🔒 Private Ownership and Employee Focus
Panda Express's unique position as a private company that doesn't franchise extensively is explored. This choice allows for complete control over operations and quality, differentiating it from other fast-food chains. The Churns' emphasis on employee satisfaction, better wages, benefits, and opportunities for advancement are highlighted as key components of their business philosophy, which positively impacts customer experience and company growth.
🤝 Charitable Efforts and Community Engagement
The final segment covers Panda Express's charitable initiatives through Panda Cares, which focuses on supporting children's hospitals, education, and disaster relief. The company's transparency and active involvement in fundraising, such as donation boxes and rounding up purchases, enhance its public image and contribute to its success. The script ends by inviting viewer feedback on their favorite menu items and thoughts on Panda Express's success factors.
Mindmap
Keywords
💡Panda Express
💡Panda Restaurant Group
💡Andrew and Peggy Cherng
💡Panda Inn
💡Fast Food
💡Adaptability
💡Competition
💡Authenticity
💡Technology
💡Private Company
💡Employee Focus
💡Charitable Efforts
Highlights
Panda Express is the largest chain of Chinese restaurants in the United States with over 2,000 locations.
The company has expanded globally, with restaurants in Mexico, Canada, South Korea, Japan, Russia, and the Philippines.
Panda Express is part of the Panda Restaurant Group, which also owns other restaurant chains.
Andrew and Peggy Cherng, founders of Panda Restaurant Group, immigrated from Taiwan and Hong Kong and became successful in the U.S.
Panda Express started as a traditional Chinese dining restaurant called Panda Inn before transitioning to a fast-food concept.
The company has shown flexibility by adapting their concept to different sizes and environments, including malls, standalone restaurants, and various other locations.
Panda Express has faced minimal competition in the Asian fast-food market, which has contributed to its success.
Menu items like Orange Chicken and Honey Walnut Shrimp have become popular and contribute significantly to the brand's success.
Panda Express has leveraged technology, including point-of-sale systems, to improve efficiency and inventory management.
The company is privately owned and does not franchise, allowing for complete control over the brand and its operations.
Panda Express focuses on employee satisfaction, offering better pay, benefits, and opportunities for growth.
The company's charitable efforts through Panda Cares have raised over $247 million for children's hospitals, education, and disaster relief.
Panda Express has a unique approach to business, valuing long-term growth and maintaining the family's vision over short-term profits.
The company's success is attributed to the 'Panda Way' philosophy, which emphasizes employee happiness leading to customer satisfaction.
Panda Express has a low employee turnover rate, indicative of a positive work environment and company culture.
The brand's image is positively influenced by its charitable work, which is well-known to its customers.
Panda Express's menu has been adapted to appeal to American tastes while maintaining the essence of Asian cuisine.
Transcripts
foreign
[Music]
this is a topic that I'm excited to talk
about because I would estimate that I've
been to Panda Express more than any
other fast food restaurant and I'm
guessing that most of the people
watching this have been there as well I
say that because they are the largest
chain of Chinese restaurants or any
Asian food in the United States that is
a big title they have over 2 000
locations that are mostly in the United
States but in 2011 they opened a
restaurant in Mexico and have since been
making their way all across the world
for example you can now find them in
Canada and South Korea Japan Russia the
Philippines and all totals to over 3
billion dollars in sales a year making
them one of the most successful
restaurants in the world so I thought it
would be interesting to take a closer
look at Panda Express and try to zero in
on the biggest reasons behind that
success while talking about how they
grew into what they are today my first
reason behind their success is the fact
that this company owns other chains of
restaurants that have proved to be
helpful on multiple levels see the
company that I'm talking about here is
Panda Restaurant Group and even though
Panda Express is by far the largest
brand that they own they are not the
only one nor were they the first the
main people behind all of it are the
husband and wife team Andrew and Peggy
churn today they are in fact
billionaires so it's a great story of
immigrants succeeding in the U.S Andrew
was raised mostly in Taiwan while Peggy
came from Hong Kong they met each other
in the 1960s when they were students
studying mathematics at Baker University
in Kansas after graduating Peggy
continued her education earning her PhD
in electrical engineering and going to
work in the Aerospace field for various
companies and even did some coding for
the U.S Navy but Andrew surprisingly
went on to manage a restaurant that was
owned by his cousin honestly it doesn't
sound like the best job he says that he
would typically work seven days a week
and get paid eight hundred dollars a
month for it plus it sounds like he had
a lot of disagreements as far as how it
should be operated so in 1973 he left
his position there and set out to open
his own restaurant he raised sixty
thousand dollars partially from a loan
from the small business administ
registration but most of it came from
his friends and family his father was in
fact a chef so he was a valuable partner
and teaming up with Andrew to open the
Panda Inn in Pasadena California unlike
the Panda Express that we know today it
was more of a traditional Chinese dining
type environment the costs were fairly
low because most of their labor force
consisted of family members working for
free but the sales were there because
there was a diverse community in the
area that was receptive to the foreign
Cuisine so for the next nine years they
existed as that single successful
restaurant then all of that changed in
the early 1980s in that short time
Andrew's father died Peggy left her
career to help run the business and they
opened a second Panda Inn in Glendale
California that also proved to be
popular so much so that they were asked
by the developer of the nearby Glendale
Galleria Mall to essentially make a fast
food version of the Panda Inn to be
opened in their food courts the churns
thought that there was potential there
so they agreed to do it and when it came
to naming it they called it Panda
Express to convey that it was a faster
version of their existing panda in by
the way the panda in chain still exists
today as five locations in California
and clearly without the foundation that
it provided Panda Express would have
never existed a couple of other
restaurant chains that they own that
have potentially helped them in
different ways would be a Hibachi's son
that's a Japanese restaurant that they
started in a mall in Minnesota in 1992
and raising canes they didn't start that
one but as of 2018 they do earn money
from the ones that they franchise in
Hawaii and Alaska all right that was the
longest one my next reason behind their
success would be flexibility and for
this I'm mostly referring to their
ability to adapt their concept into
different sizes and different
environments I mean I just talked about
how the chain was started by adapting
their panda in restaurant into an
Express Mall based concept but it kept
evolving from there after five years
they had about a dozen locations that I
believe were all in shopping malls but
then they started opening bigger
Standalone restaurants as well as some
others that were inside of other types
of buildings it started when they they
open one inside of a Von supermarket in
1988 but today you can commonly find
them just about anywhere I'm talking
about airports military bases sports
stadiums some of them are hundreds of
square feet While others are thousands
of square feet they all have to be
operated differently and Panda Express
has been flexible enough to make all of
it work next up on the list is a lack of
competition not to take anything away
from them but for pretty much their
entire existence Panda Express has not
been operating in the most competitive
environment sure maybe in some ways but
I'll challenge you to name another chain
of restaurants that is comparable to
Panda Express in their early days fast
food was considered to be an Emerging
Market in the U.S as was Asian food and
there weren't many others taking
advantage of both of those at the same
time I thought it was interesting that
they say they started habachi-san as a
way to protect Panda Express from the
competition that they were getting from
Japanese restaurants probably the most
notable direct competitor that they've
ever had to face would be Manchu walk
it's a similar chain of mall-based
Chinese restaurants that used to be
pretty big on the east coast in the
1990s when Panda Express was first
trying to enter the eastern part of the
country they initially had some trouble
drawing people away from the already
familiar Manchu walk but it didn't take
long they don't seem to get the best
reviews not anymore anyway and Panda
Express was just expanding quicker today
they are not even a factor with only 13
locations in the US remaining another
competitor worth mentioning would be PF
Changs being that they are another large
chain of Asian restaurants but that
one's more of a casual dining sit-down
restaurant almost anybody who's been to
both of them will tell you that they are
very different from each other plus with
only around 215 locations PF Chang's is
technically about 10 percent the size of
Panda Express so overall Panda Express
got in early in some emerging markets
and never really let anyone catch up to
them going back to the list how have I
talked about Panda Express for so long
without even mentioning their menu if
you haven't tried their honey walnut
shrimp what have you been doing now it
does cost a little bit extra but it is
well worth it there's a whole debate out
there as to whether or not they serve
authentic Asian Cuisine I don't want to
be part of that debate or get into the
specifics but obviously it's not the
same thing that you would get in China
they have made changes to make the food
more appealing to the American customer
base and they have made changes to allow
them to make it quicker it changes that
have obviously been effective their
famous orange chicken for example was
actually invented by a chef working for
them in 1987. it has since become their
most popular menu item and the reason
that many people go there they sell tens
of millions of pounds of it each year so
that alone probably accounts for a good
portion of their success really I could
stay here talking about their menu for a
while but for the purposes of this video
I just want to convey how effective
they've been in introducing Asian food
to the American markets so much so that
for many Americans this has been their
first and biggest exposure to it next on
my list I want to briefly talk about how
technology has been helpful for Panda
Express for this I'm looking at Peggy
churn giving her various degrees science
and experience in the field she knows
about technology and maybe the biggest
way that this has helped them is the
fact that from the beginning in 1983
they were using computers and a point of
sale system giving them an advantage
over the rest of the industry because
most of the others weren't doing it yet
it made them more efficient in that it
allowed people to place their orders
faster it gave them better control of
their inventory they learned which items
were selling better than others helping
them reduce their cost and making the
customers happier in the process okay my
next reason behind their success is a
debatable one but Panda Express is
amazingly a private company that doesn't
franchise I should say that there are a
few minor exceptions on the franchising
part but nothing significant this right
here has to be one of the biggest ways
that they stand out from the rest of the
industry because these are such
effective ways to grow that they've been
used by almost every other fast food
chain I've talked about this stuff a lot
on the channel before but really quick
franchising helps a restaurant open a
bunch of locations because it's
essentially other people opening
restaurants but paying paying you to use
their brand and becoming a public
company is a way of selling ownership of
it and commonly using that money to open
more restaurants or helping the existing
ones or whatever my point is that
without doing either one of these it is
very hard to grow Panda Express like I
said amazingly has been able to do it by
reinvesting their own profits they say
that they prefer this approach because
it's their only way to maintain complete
control you know if you have a
franchisee running a location he may let
the quality of the food slip or the
service or whatever or if they became a
public company they would then have to
answer to investors who may want to make
changes that they disagree with plus the
stock market is also known to Value
short-term profits over the long-term
business plan I say it's debatable
because if they did do these things they
would probably be bigger but due to the
lack of control the restaurants would
almost certainly not align as closely
with the family's vision and may be less
popular with their customers as a result
so it's a definite trade-off but the way
that they've chosen to do it has
obviously been paying off my next reason
kind of ties in into that it's their
focus on their employees it's the
mentality that happy employees lead to
happy customers and for the most part
that does seem to be the case here there
have been some issues at times but Peggy
and Andrew are always talking about the
panda way and pretty much identify this
as the biggest reason behind their
growth and success if you work for Panda
Express you likely make more money than
the industry average and get better
benefits if you work so many hours a
week and you'll be encouraged to
meditate and read self-help books they
may even want you to take management
courses because a lot of the people in
their corporate offices are promoted
from the restaurants they have a low
turnover rate they've been put on
various lists talking about the best
employers I don't know there's so much
that could be said about it if you have
experience working for them maybe you
could provide some insight but they do
appear to focus on their employees and
that has reflected well upon the rest of
the business my eighth and final reason
behind their success is their charitable
efforts in 1999 they established a panda
cares they're primarily focused on
raising money for children's hospitals
education and disaster relief since the
start of it they have raised over 247
million dollars that mostly come from
customers within the restaurants but
they also have this annual golf
tournament and employees help out and
there's other means as well you may want
to look further into it if you're
interested but the fact is that they're
very upfront about it to a point where
most Panda Express customers are
probably well aware of it maybe you've
seen that donation box or you've been
asked to round up your purchase to the
nearest dollar or whatever else and that
contributes to their overall image and
general success of the company let me
know in the comments what do you get
when you go to Panda Express as I said I
am all about that honey walnut shrimp
and the orange chicken of course it's a
winning combination but also what do you
think of my eight reasons behind their
success is there something that doesn't
belong there or should something else be
added to it maybe you think that
adorable little panda on the logo has
played a part of it or maybe the fortune
cookies those are always fun so any
thoughts you have about Panda Express
leave them in the comments I'd like to
hear what you have to say thank you for
watching
foreign
[Music]
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