Panda Express is one of the most recognizable names in the fast-casual dining sector, particularly in the realm of American-Chinese cuisine. Founded in 1983 in Glendale, California, Panda Express has grown into a global powerhouse, with over 2,200 locations worldwide. Known for dishes like Orange Chicken and Beijing Beef, Panda Express has become synonymous with quick, flavorful, and affordable Chinese-inspired food. The restaurant chain’s unique blend of Chinese and American flavors has made it a staple in food courts, shopping malls, and standalone locations across the U.S. and beyond.
This article takes a deep dive into Panda Express’s history, the strategies that have fueled its rapid expansion, and an analysis of its current financial standing as one of the largest family-owned restaurant chains in the United States.
The Early Years: Founding of Panda Express
The Origins: Panda Inn (1973)
Panda Express’s roots trace back to Panda Inn, a full-service Chinese restaurant founded in 1973 by Andrew Cherng and his father, Master Chef Ming-Tsai Cherng, in Pasadena, California. The Cherng family, originally from China, immigrated to the United States, where they sought to introduce authentic Chinese dishes to an American audience. Panda Inn focused on creating high-quality, flavorful Chinese dishes in a more formal dining setting, and it quickly developed a loyal customer base.
The success of Panda Inn marked the beginning of the Cherng family’s journey into the restaurant business, but it wasn’t until a decade later that they would create the fast-food juggernaut known as Panda Express.
Founding of Panda Express (1983)
In 1983, Andrew Cherng and his wife, Peggy Cherng, a computer engineer with a PhD, co-founded Panda Express with the goal of bringing Chinese cuisine to a broader, fast-paced, casual dining market. Their first Panda Express location was inside the Glendale Galleria Mall in Glendale, California. The decision to open in a mall food court was a pivotal move that would shape Panda Express’s future growth, as it allowed the restaurant to attract a wide variety of customers and benefit from high foot traffic.
Peggy Cherng’s engineering and technical background played a critical role in the success of Panda Express. She helped streamline operations by integrating early computer systems that optimized workflow and inventory management, improving the efficiency of the business. This attention to detail helped Panda Express deliver consistent quality and customer service, which would become hallmarks of the brand.
Expansion and the Rise of American-Chinese Cuisine
Early Expansion in Shopping Malls and Airports
Panda Express’s early growth was fueled by its strategic focus on opening locations in shopping malls, airports, and other high-traffic areas. By targeting spaces with a built-in customer base, the chain quickly gained popularity among shoppers and travelers who were looking for quick, flavorful meals at an affordable price.
This focus on convenience allowed Panda Express to rapidly expand throughout the 1980s and 1990s. By the mid-1990s, the chain had established itself as one of the go-to spots for American-Chinese food in mall food courts across the U.S.
The Development of Iconic Dishes
One of the key factors behind Panda Express’s success is its ability to adapt traditional Chinese recipes to appeal to American tastes. The restaurant’s most famous dish, Orange Chicken, was developed in 1987 by Chef Andy Kao, and it has since become a signature dish not only for Panda Express but also for American-Chinese cuisine as a whole. The sweet and tangy flavors of Orange Chicken, paired with a crispy fried texture, became an instant hit with American consumers.
In addition to Orange Chicken, Panda Express has developed other popular dishes like Beijing Beef, Kung Pao Chicken, and Honey Walnut Shrimp, all of which offer a fusion of flavors inspired by traditional Chinese dishes, but tailored to suit Western palates. This balance of authenticity and adaptation has allowed Panda Express to appeal to a wide audience while maintaining its identity as a Chinese-American restaurant.
Key Growth Strategies and Business Model
Family-Owned and Operated
One unique aspect of Panda Express is that it remains a family-owned business, which is rare among restaurant chains of its size. Andrew and Peggy Cherng, along with their children, have maintained close control over the company, ensuring that it stays true to its core values of quality, consistency, and service.
Because Panda Express has resisted going public or franchising to outside owners, it has been able to grow on its own terms, without the pressure of shareholders or investors. This has allowed the company to focus on long-term sustainability and maintain a consistent brand image.
Efficient Operations and Technology
From its inception, Panda Express has invested heavily in technology to improve its operations. In the early days, Peggy Cherng’s engineering expertise helped Panda Express implement computerized inventory and ordering systems, ensuring that locations ran smoothly and that the company could scale without sacrificing quality.
In the modern era, Panda Express has continued to embrace technology, integrating online ordering, delivery platforms, and mobile apps to cater to the needs of tech-savvy consumers. The company also uses data analytics to track customer preferences and streamline its supply chain, which helps keep costs down and ensure consistent quality across all locations.
Healthy Options and Menu Customization
In response to changing consumer preferences for healthier dining options, Panda Express has also introduced a range of healthier dishes, such as Wok Smart entrees, which are lower in calories, sugar, and fat. The company has also committed to using fresh, high-quality ingredients, and in 2016, Panda Express eliminated artificial flavors and MSG from its menu items.
This focus on providing healthier, customizable options has helped Panda Express maintain its appeal to a broader audience, particularly millennials and health-conscious diners who are looking for fast-casual options that align with their dietary preferences.
Global Expansion: Entering New Markets
International Expansion
After dominating the U.S. market, Panda Express began its international expansion in the 2000s, opening its first overseas location in Mexico City in 2011. Since then, the chain has opened locations in Canada, Japan, South Korea, Russia, Saudi Arabia, Guam, and the Philippines, among others.
The company has adapted its menu in certain international markets to better suit local tastes. For example, in Japan, Panda Express offers rice bowls and more traditional Chinese dishes that resonate with Japanese diners. However, signature items like Orange Chicken remain popular in international markets, demonstrating the global appeal of Panda Express’s signature flavor profiles.
Despite its growing international presence, Panda Express’s global footprint remains more modest compared to its domestic operations. The company continues to explore opportunities for further international expansion, with a focus on markets in Asia and the Middle East.
Financial Overview and Net Worth
Current Net Worth
As of 2023, Panda Express’s annual revenue is estimated to be approximately $3 billion USD, making it one of the largest fast-casual dining chains in the United States. The chain’s financial success has largely been driven by its vast network of locations and its ability to maintain a relatively high average unit volume (AUV) compared to other fast-food chains.
While the company does not disclose its exact net worth, industry estimates place the combined wealth of Panda Express’s co-founders, Andrew and Peggy Cherng, at over $3.5 billion USD, which makes them among the richest individuals in the restaurant industry.
Global Footprint
Panda Express currently operates more than 2,200 locations across the globe, with the vast majority located in the United States. Its aggressive growth strategy, combined with its efficient operations and technology integration, has made Panda Express one of the most successful family-owned restaurant chains in the world.
In addition to its standalone restaurants, Panda Express operates in non-traditional venues such as airports, casinos, theme parks, military bases, and university campuses, further expanding its reach and customer base.
Challenges and Adaptations
Competition in the Fast-Casual Sector
As Panda Express has expanded, it has faced increasing competition from other fast-casual chains offering healthier, more modern Asian-inspired options. Brands like Pei Wei, P.F. Chang’s, and smaller boutique chains have attempted to challenge Panda Express’s dominance in the American-Chinese cuisine market.
To stay competitive, Panda Express has continued to innovate, introducing new menu items regularly, refreshing its restaurants with more modern, sleek designs, and offering more healthy, plant-based options. By remaining flexible and responsive to changing market trends, Panda Express has been able to fend off competition and maintain its market leadership.
Adapting to Delivery and Takeout
In the wake of the COVID-19 pandemic, Panda Express, like many other restaurant chains, had to adapt quickly to meet the demands of a new dining environment where delivery and takeout became essential. The company embraced delivery services like DoorDash, Uber Eats, and its own Panda Express app to offer customers more ways to enjoy their meals without visiting physical locations.
This pivot to digital ordering platforms helped Panda Express remain resilient during a challenging time for the restaurant industry, ensuring it could continue to serve its loyal customers while minimizing losses during the pandemic.
Philanthropy and Corporate Social Responsibility
Panda Cares
Panda Express is also known for its commitment to philanthropy through its Panda Cares Foundation, which was founded in 1999. The foundation’s mission is to promote the health and education of underserved youth by donating to hospitals, schools, and community programs. Panda Express encourages its customers to participate by rounding up their purchases, with the proceeds going directly to Panda Cares initiatives.
As of 2023, Panda Cares has donated over $250 million USD to various causes, including children’s hospitals, disaster relief, and educational programs.
From its humble beginnings in a mall food court to its status as a global fast-casual giant, Panda Express has proven itself as a resilient and innovative brand that has mastered the art of combining traditional Chinese flavors with American tastes. Its commitment to operational efficiency, technological innovation, and consistent quality has driven its success and allowed it to maintain its position as a leader in the American-Chinese cuisine market.
With an estimated net worth of over $3 billion USD, Panda Express continues to grow both domestically and internationally, offering a unique and flavorful dining experience to millions of customers worldwide. As the brand expands and adapts to changing market conditions, its core values of family ownership, quality, and philanthropy ensure that Panda Express remains a dominant player in the fast-casual dining industry for years to come.