eBay Is An Option

eBay Is An Option

Interview with Thierry Aujard

Sweet Prosperity Bakery

Valley Forge, Pennsylvania

By Jeff Yoskowitz, Jessie Riley and Kathryn Gordon

Kathryn:  Hi Thierry!  Jessie and I have known you for years through the World Pastry Forum and Championships.  It’s great to visit you here in Pennsylvania, and see this amazing space you’re constructing.  How big is it?

Thierry:  We have 7,000 square feet.  It was formerly a chocolate production facility so there was already flooring and some useable walls.  We just got the space 2 weeks ago and we are in the middle of everything;  electric, sheet rock, adding washable wall surfaces, washable ceiling tiles, building a storage facility with a giant fork-lift and also adding a large walk-in freezer on the loading dock.

Digging under the concrete for the freezer walk-in insulation at the loading dock 

Jessie:  I thought that you had wanted to open a retail “corner” bakery? How did this project evolve instead?

Thierry:  I was working at another wholesale bakery in the area, and had taken over as pastry chef.   I worked with the recipes and procedures to make the process more efficient, and the clients liked my work.

Three clients from that bakery approached me to produce their product for them.   They came with me to the bank and supported me through the SBA loan process, verifying they would transfer their business to me when I am open in production.  They gave me a letter of intent to do business with them, and their past year’s sales data and projected 3 years.  The production levels are quite high, one of the clients already has an operational contract with Costco.

Jeff:  How are you financing building your own manufacturing facility?

Thierry:  We have taken an SBA loan and put our home up as collateral, and I had to put in some of my own savings (per SBA rules).   The bank gave us a loan and a line of credit for one-third of the total loan value.

Kathryn:  The whole process is amazing.  It’s like it all fell into place.  When did you start the process, and when are you hoping to open?

Thierry:  We just took possession of the space a few weeks ago, but I started working on the business plan for the loan application in May.  I’m hoping to open for production mid August.   We are in the construction phase now and equipment is coming in.

One of 3 depositors (never used) purchased through eBay 

Since I started to write the business plan, 4 additional companies and QVC (which is in the region) contacted me to ask if I would manufacture products for other businesses.  I said yes, because it is difficult for companies to find a co-producer with small production runs. I also now have my own contract with QVC for 3 of my own products to be launched at the end of the year.

Kathryn:  You wrote the business plan and you got your funding very quickly! 

Thierry:  It took a month and a half to put the business plan together, which is kind of stressful with everyone rushing you.  The SBA pressures you for the business plan, and the clients wanted to leave their existing manufacturing facility.

The SBA money came thru via our bank. The lender was organized by SCORE, who were awesome and helped identify 4-5 potential lenders.  My wife Cherie went to meet them with a few of our contracted clients, and that make a huge difference; the numbers were not coming from the sky, but were based on reality.

In 2-3 weeks, the lender came back with their underwriting.  So it was very fast and I finalized the paperwork last week.

A dishwasher that will accommodate washing a full speedrack!!! 

Jessie:  It’s amazing that you already have a strong relationship with your clients.

Thierry:  One even helped me find the production space, and a builder to do the construction.  I got this space the very first morning it was put on the market at 25 cents per square foot.

Kathryn:  How about your staff ? Are you ready to go with production in a month from a staff perspective?

Thierry:  I have my managers in place.  They are coming with me from the prior production facility.  Therefore they are already trained on producing these formulas.  We just have to get used to new equipment.

Jeff:  There was no equipment here, right?  You are bringing in everything?  How are you making the decisions regarding purchasing “new” versus “refurbished” equipment?

One of new the double rack rotating ovens 

Thierry:  I have a mix of new and used equipment.  If the equipment is essential to the “life of the bakery,” I am buying it new.  In other words, I cannot lose someone’s product while it is stored on our palets in the freezer.  I cannot risk that it is not baked correctly,  so the freezers/compressors/condensors and ovens are all new.  

Thierry:  We are fortunate to be located in the area near the largest equipment refurbisher in the United States, in case I need help.  I have gotten a lot of my equipment on eBay, and from as far away as Florida.  Through eBay, you pay for shipping but you can get some very good deals (like on the mixers and depositors).  

Jeff:  You know what equipment you need, and you are already experienced with manufacturing this product for these clients. Has anything been a surprise to you? 

Thierry:  Yes, the range of price quotes for the installation of the walk-in refrigerators and freezers with compressors and condensors.  The high end quote varied by as much as 5X more than we are currently paying for our installation.  Shop around!   

Two 120-quart refurbished mixers 

Calm before the storm?  Production facility in construction phase 

Kathryn:  Thank you Thierry, we look forward to visiting you again once you’re up and running!

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Choosing the right equipment for your food business.

The Right Tools For the Job
Interview with Ed Delandri, Food Equipment Technical Advisor at Interline Brands
By Kathryn Gordon and Jessie Riley

Kathryn:   Ed, I’ve known you since 2005 but can you tell our readers exactly what you do?

Ed:  I help sell commercial kitchen plumbing and food service equipment.   I am in the corporate office of an equipment wholesaler.  Our sales force sells to the end user, the restaurant or bakery.  I am the technical advisor for both our sales people, and the end customers.   In other words, the salesman will start to talk to a customer – but if the customer doesn’t know what they want or need – I get involved, and source it and get it for them.  I’m on phone, email, video or teleconferencing all day and occasionally I travel. 

Ed works for J.A. Sexauer, a division of Interline Grands (www.sexauer.com)

Jessie:  Do chefs and owners typically agree on what they need?

Ed:  No, it doesn’t usually mesh!  What would be ideal for the chef may not be affordable to the owner, so I need to help both of them figure out how to do something else.   We work with vendors around the world so there are infinite options regarding what can be arranged for any customer and given the variables, every situation is unique.

Kathryn:  Why do customers generally come to you about custom design vs. stock, already available equipment?

Ed:  We’re the 4^th largest wholesaler in the world, so people know our name.  I take pride in helping people find the right fit. We will not sell a new chef or baker something we do not think they need, won’t help them, or will cost them too much in the end and create risk.  We have a good reputation, and people know we can customize equipment.  The customers drive the demand, not our salespeople and actually, even our competitors use us sometimes to sell to third parties.

Kathryn:  How do you start the process of determining exactly what a customer who is designing a new retail (brick & mortar) location needs?

Ed:  Videos and photos can go a long way.   It helps to have an integrated team of the architect, engineer, electricians and plumbers. 

Jessie:  For custom designs, do customers have to pre-pay?

Ed:  Not if it’s a repeat client who provides us good business like purchases of $500K per year.  Bottom line:  we want happy customers.   If it’s an all-new customer, some sort of a deposit will be negotiated based on what the vendor for that type of equipment requires.

Jessie:  But what happens if the customer specifications are wrong?

Ed:  Someone has to sign off on the contract before the work is started.  It could be the end-customer, or the architect.   Custom items are non-returnable but if the vendor is wrong, they will take the responsibility to fix the situation.  Occasionally an architect or engineer has to take the responsibility if they were the one to provide the incorrect specifications regarding space, etc. on behalf of the client.

For big ticket items it’s key for you to be involved hands-on in making your own decision.  If you know your own business, don’t let anyone push stuff on you, standard or custom, or you’ll wind up with the wrong equipment.

Kathryn:  What are the most common mistakes you’ve seen in terms of wrong equipment selection?

Ed:  A lot of novice people screw up ordering ice machines.  They don’t provide enough specifications on how they want it to work, and there are a lot of options.  

I’ve also seen a lot of errors around fryers. Experienced chefs know they are purchased in pounds per hour.   New businesses don’t always know how to project how many covers they will have, let alone peak frying volume and we need to know that and how many items on their entire menu will be fried to be able to help recommend a specific fryer that will actually work for the customers’ needs.

Sometimes, refrigeration is ordered because a restaurant chef loves the equipment design, but nothing was measured correctly and when they arrive, the reach-ins don’t fit under the counter.

Kathryn:  How can customers best help an equipment purveyor understand what they need, especially since you can order from wholesale equipment purveyors all over the world?

Ed:  The more specifications on how they want everything to work, the better.  Allowing time for custom work is also important.  Customers have to be articulate and videos and photographs help immensely.  I can also go out and visit a difficult situation if necessary but remember you may be forced to select domestic vs. international given the shipping costs (like for a heavy espresso machine, or an AGA-type stove).

Jessie:  What do you do with equipment that’s returned, or cannot be sold?

Ed:  Periodically, our locations will host sidewalk sales! 

Kathryn:  Do you think that custom versus stock is the way to go, especially since you’re in that side of the business?

Ed:  Actually, no I don’t.  Blending custom and stock is usually the best thing but owners should never jump in with huge dollar investments without prior understanding of their business.  We take pride in what we do, and we want the businesses to come back to us so we will not sell them equipment that’s wrong for them no matter how much more we could make.  I am also a chef, and I will try my best to help steer them in the right direction.  You have to remember, the artistic side of fancy custom equipment appeals psychologically but does not ever translate to commercial quality.

Jessie:  So where should people start?

Ed:   There can be a benefit of a seamless, integrated team recommendation – but that’s often impossible.  So don’t just use “too many cooks” to make key decisions.  You can start directly with calls to manufacturers to determine some of your initial possibilities, and you can do that yourself.  Look at websites, communicate with equipment engineers and start making your own decisions. If you’re stuck, use a knowledgeable middleman and trust us to help guide you.  It costs too much money to take the risk of wrong equipment selection, especially if you’re new to this part of the business.

Kathryn:  Thanks Ed!  

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