Welcome to the sixth season of the Troubleshooting Innovation podcast. Joanie Spencer, editor-in-chief for Commercial Baking, visits with various members of the team at New Haven, CT-based Chabaso Bakery. Hear about their journey to becoming a Certified B Corporation and building a business as a force for good. Sponsored by JLS Automation.

This week, we’re chatting with Charlie Negaro, CEO, and Reed Immer, director of sales and marketing. They unpack the challenges and rewards of pursuing B Corp certification, and why the long, arduous process was worth it.

Learn more about this season here, and listen to Troubleshooting Innovation on Apple, Spotify, Google and Stitcher.

Joanie Spencer: Hi, Charlie. Hi, Reed.

Charlie Negaro: Hey, Joanie.

Reed Immer: Hi, Joanie!

Spencer: I am really excited to dive into this. I know there’s a lot to unpack in the discussion that Charlie and I had last week. It’s very clear that Chabaso was already living many B Corp values in its daily practice. But you all still put in the effort to seek certification, which is a long, and I’m assuming somewhat arduous process. So in this episode, we’re going to explore this journey with the two of you and sort of uncover the reasons behind the process and what it took to gain that certification. And I want to start the conversation with a straightforward question. And that is, why?

Negaro: Yeah, so why? Why try to obtain a certification for something that you feel like you’re already doing? I think for us being an extremely entrepreneurial company, it really spoke to us to have something that helps you to refine what you’re already doing.

Spencer: Yeah.

Negaro: We’ve never been the best at putting words succinctly, for what we do. Kind of like my answer to your question. Just like manufacturers have quality programs, to have a tool that helps you put words to it and that helps you get better. When you go through the process of answering the questions for B Corp, it also challenges you to think about things in ways that you never may have approached it. And then also, once you get into the world of B Corp, you realize that there’s this cohort of like-minded people that can support you in your day-to-day journey of trying to be a business that does good in this world. And also just the standard day-to-day challenges of running and operating a business in the world today.

Spencer: You know, I really liked what you said last week, Charlie, about just like mission and vision statements. Sometimes it’s hard to sort of formulate those words, and they can change. But your actions sort of represent you with more continuity. It truly is actions speak louder than words. But I liked what you said that the B Corp certification helped put words to your actions.

Negaro: Exactly.

Immer: And I would just add to Charlie’s statement that a lot of the stuff that is part of B Corp has been part of Chabaso’s DNA for the history of the company. And there’s always been this interest in using this as a force for good, and all these amazing programs have popped up. But sometimes when you’re in your own world of doing those things, it’s easy just to focus on the highlights and not necessarily look at it from a higher level view of all these different stakeholder groups that we interact with. Are we holding ourselves up to the same level of standards that we’re doing in these little silos of the organization? So it’s helped us to have this more 360 view, and actually start to walk the talk of, are we actually as good of a company in terms of goodness as we like to think we are? And I think often when you really go through this rigorous assessment, you realize there’s some great stuff we’ve been doing. But there’s also a lot more work we can be doing to live up to this level that that we’d like to be doing. And I think like Charlie said, in terms of it functioning as a tool for us, the specific tool that I see it as it’s almost a compass, in terms of if you have this larger vision of force for good. Sometimes it’s easy to get a little lost in the sauce and do a million things at once. But this is a way that kind of helps structure it into a manageable framework that can be delegated throughout the organization, that kind of different departments and folks can learn how they fit into more focused responsibilities, and how that contributes to the overall force for goodness of the organization. It’s a way that you can bring it out of the CEO’s head and have it be something that affects the day-to-day operations of everybody across the whole organization.

Spencer: So here’s something that I found to be really fascinating from my particular perspective, as a B2B journalist in the baking industry, the network of Certified B Corps is more than 3,000 companies [in the US and Canada]. And when I went on the website and went to the database, you can search by keywords and I typed in “food manufacturing,” and a little less than 400 names came up. And when I typed in a search for “bakery,” 34 names came up. So you are really breaking ground in our industry, and sort of paving the way I think, for doing good through baking. What do you guys think are some of the barriers? Why is it that there aren’t that many food manufacturing companies, relatively speaking, and there aren’t very many at all that classify as bakery? What do you think the barriers are for bakeries to gain this certification?

Immer: I think one of the challenges is that the B Corp Impact Assessment that you need to go through to get the initial certification doesn’t change that much depending on the type of business you are. I think just from a manufacturing organization, where you’re making physical goods, it’s sometimes harder to live up to those same environmental waste standards than an ad agency or some other white collar business. It’s easier for them to do that. So even though there might be a lot of other folks in the manufacturing and food industries that see this as a good thing to do, and something they’d like to have be part of their business, there are just some hurdles from being a manufacturer of physical goods that makes it a little harder to live up to the requirements. So I think that’s one thing. I think, also, the baking industry is a little bit old school, which is really cool in some ways. But I think in some other ways, there’s some businesses that are family owned that have been around for a while, and to some of them they have a great product and a good thing going. And there’s not necessarily always a critical motivation to kind of jump to this next higher level, especially when there aren’t that many businesses that have done that in your sector. One of the things we’re hoping to do is to prove and be an example of all the benefits that can come to a manufacturing organization from receiving the certification. And hopefully inspire some other folks to tread forward on that path as well.

Spencer: I agree. I think you guys have an opportunity to be a beacon for our industry and how to do things differently. Why do you think it’s important for baking companies to seek and achieve B Corp certification? How can having these tools change our industry?

Immer: A few of the big benefits that we’re seeing early on, but we’re still pursuing is, first off, attracting high quality talent for a manufacturing organization. It has always been a challenge and is increasingly more and more of a challenge. And so there’s this aspect of your organization’s employer brand. Why do I want to work for you? Why do I spend my day in day out, years of my life kind of being part of this organization? And so we found a lot of other organizations that have made progress with this B Corp and all the other related aspects of goodness for your stakeholders. You start to attract the type of person that wants to work really hard, that wants to make a difference in the world, that wants to build something and that aligns with a lot of what Chabaso has been up to over the years. So we see this as reinforcing the pitch for folks to kind of come join the organization and make an impact in the world. So we see that helping with building that team internally. And then also, bread is a commodity product. One of Charlie’s big things is “How do we de-commoditize bread?” And we found that having these trustworthy third-party certifications, that’s not everything, but that’s one aspect of helping to stand apart from other products in the bakery category or in a grocer and other food sales operations and help build our business to have more of a meaning for the shopper. Have them see this as, “Okay, this is worth spending a buck more on this loaf of bread because I know it’s part of a good organization that’s making a difference and a little bit of voting with your dollar.”

Spencer: For sure. I think just especially in the past decade, food manufacturing has gotten a really bad rap. And it’s frustrating for me when I hear people talk about big food and food manufacturing, when I see through a different lens. Because I’m sort of on the inside, and it’s not what people assume, and I feel like the more baking companies and food manufacturing companies that can gain B Corp certification, the sooner that curtain is going to come down and the general public is going to see that it’s not this dark, we’re trying to just profit off of people. There’s more to it.

Immer: Absolutely.

Negaro: Yeah, everything we do as food manufacturers affects so many core things of life. Going back to what we talked about last week, we’re using this thing that a lot of people, specifically in the baking world, take for granted, which is flour, specifically commodity flour. I think in the last couple of years consumers have gotten a new awareness of grocery stores, what they mean for us, how we access food when we can’t leave the house, and what people are doing for you that have to leave the house when you’re stuck inside for whatever reason. That has created a lot of challenge that we’re still grappling with as a society and as a world. And I think for us, it’s helped us double down our effort on making sure that we’re connected with our staff and our customers and consumers in a way that feels sustainable and genuine and helps us think about how we do better.

Spencer: I want to take a look at your specific journey to gaining this certification. And like you said, you spent 15 years trying to get here. Not necessarily doing the certification process, but doing what it takes to get there and how you’re forming your mission as a company. But when you sat down to do that B Impact Assessment and fill out that form, what was that initial impression? What kind of self-reflection did that trigger for you?

Negaro: I don’t want to scare anybody away by being like, “Wait, it took you guys 15 years? What have you been doing?” So I think with most things that I get interested in, you see a group of people or person doing something and think, “Okay, I want to go to there. I want to be like that person. I look up to this, or that’s a challenge that I have no idea what this is, but I want to understand it.” And I’m just like, “Okay, I’m gonna cannonball into the deep end.” One of the beautiful things about B Lab and what they’ve done with this is you can just go and take the Impact Assessment. I mean, it takes you forever. When we first started this, and I think it’s still the case, anybody can just go on and do the Impact Assessment. And I did that like a bajillion years ago. I probably made it halfway through, probably at the expense of not doing my day job for a week. And you have that experience of, “Okay, yeah, we’re doing a lot of stuff. This is cool. But we’re really not doing a bunch of this. And there’s questions in here that I’ve never thought of.” And like you said, there’s a period of self-reflection, which is always hard to hear that you’re not quite there yet. Sometimes part of that is stepping into that unknown and going, “Okay, I don’t really know what I’m doing, or I’m not quite there yet. Or we’re not quite there yet. Let’s let’s go for it. Let’s do this.” Having people on our team like Reed who will sustain that effort and spend more than a week on it, and still do their day job is the key to chipping away at it. I could see how somebody might get discouraged at it. But it’s about being up for the challenge of wanting to evolve or change how you do things for the better.

Spencer: We talked a little bit about how the process is about taking that self-reflection and knowing how you want to do better, and then turning that into something that’s quantifiable. How hard is that? And I’m guessing that this is going to be a question for Reed. Can you talk to me about what it’s like to turn something that’s so qualitative into hard numbers? How long does something like that take and still do your day job?

Immer: Exactly. So for this most recent run of us attempting to do the Impact Assessment, it took the better part of two years to collect all the data from all these different departments and input that into the assessment. We have a lot of great internal reporting at Chabaso, usually more on the typical manufacturing stuff, such as how many ingredients we use to make this batch and what our sales are, but there’s all these other areas that are a part of the B Corp assessment that we didn’t really have reporting setup for already. Part of it was having these conversations with the team and figuring it out while still balancing the day to day. How can we be chipping away at getting this report on our environmental footprint or difference in pay between different levels of the organization and all this other stuff? It’s not like any single question was insanely complex or difficult to gather, but just the combination of them all combined together can be a little bit of a daunting process and required a little bit of just blind stubbornness on my part of just keep pushing forward. And I think also part of that is, it’s such a large project that it’s so important that the top level of the organization really sees the value of this just in terms of it being a force for good. Because otherwise, it’s really easy to lose steam.

I’ve been at Chabaso for about five years now. When I first joined, we had done another attempt at doing this and probably got like a quarter of the way through. And then just there’s so much other stuff going on that we decided we got to put this on pause. That kind of made me realize, if we really want to do this again, it’s going to require X amount more energy, but still having that top level interest in it. That makes a difference in whether you feel that support to keep moving forward with it or if it becomes something that’s just kind of nice to have, but we don’t really need to be focusing on it. And when you go through these hundreds of questions for the Impact Assessment, Charlie and I have found things that would be a good for us to be doing. Or things we haven’t really thought about. If you already had that reaction of, “Oh, yeah, that is good. We should be doing that,” I think that’s a really good sign that there’s some alignment. If you read through the questions, and you think “Why the heck do I care about this? That’s not part of our DNA at all,” then I think that’s a sign that maybe the values aren’t initially aligned.

Spencer: Right.

Immer: And that’s a big difference maker.

Spencer: I have this vision in my head of someone looking at it and going, “Oh, that’s a really great idea,” or “Oh, there’s more to do.”

Negaro: Exactly right. There was a conversation, around two years ago, where Reed turned to me and was like, “Okay, is this something you actually want to do or not? If you want to do it, we have to actually do this.” And some of that has come through Reed and I knowing each other for a long time. And knowing when you have to level set and check in. And we got very fortunate because as I mentioned in the last episode, New Haven Farms was somebody that incubated out of Chabaso, and the former director of that is Rebecca Kline Coffey. She went on to work for a company that helps aspiring B Corp companies get their certification. And Rebecca is someone I’ve known my whole life and having that additional person that can hold you accountable, and that you don’t want to let down … there were definitely times that if it wasn’t for her, and if it wasn’t for Reed, I would have punted on this. Having people who believe in this is essential. It’s not a one-person job.

Spencer: Did you build a team? And how big was that team?

Immer: Rebecca and I worked really closely together. We’d focus it with a respective department of Chabaso and all the questions that were relevant to that department. And I tried to schedule a few meetings or video calls with respect to folks at Chabaso that were the experts in these questions and could help me answer them. But the core group was me and Rebecca working weekly, with Charlie being part of the scene and maybe doing some check ins every other week or monthly. A lot of the coordination work fell on my shoulders, which was a really amazing process and tough and educational in a way to learn a lot more about the whole organization than kind of just from the sales and marketing side. But definitely having some sort of internal champion is very important. Having that support from the top from Charlie and folks was really important. And I think from here, one of the things that we’re starting to clarify is some sort of official internal committee that is more efficiently looping in folks from across the organization to have this be part of their monthly projects or whatever. There’s different ways to tackle it. Because we’re a small company, we just didn’t have the resources to hire somebody just be the internal B Corp person, full time, day to day. In larger organizations, you have your sustainability or your impact team and all their work incentives are revolving around bringing this to the finish line and keeping this moving forward. I think in the small organization, the challenge is how do you still do the day-to-day stuff, which is still a huge challenge with limited resources, and how do you find a way to kind of work that in without overburdening yourself. It was definitely a complex dance over those two years to figure that out.

Spencer: I feel like when you’re a small company, that you have to just pull from those internal resources, as opposed to a huge company that, like you said, has a team of people who are dedicated solely to sustainability and impact those small teams. It says so much about who you are as a company, because you have to be really passionate about it in order to take that on, and wear that hat in addition to all the other hats you’re wearing.

Immer: Absolutely. And I think Charlie and I share a lot of these same interests with using this business as a force for good. And for me, it was like, how do I want to live my life day to day? And having this feeling that you’re contributing to some sort of smidgen of goodness in the world, that’s just how I’d rather be living my life. And if it takes all of us working a little harder to be making that happen, I’d still rather all of our collective days be involving that stuff. And Charlie and his dad and the whole DNA of Chabaso, were already on that path so much. And there are already so many folks in the organization that just kind of naturally saw the value of this. So it wasn’t really that hard of a sell of why this is important. Of course, managing it and having it be a not too burdensome day-to-day thing, that was the bigger challenge. But already having that internal interest and the direction we want to be moving in, that was essential for a small business like us to really make this work.

Spencer: The assessment revolves around this idea of measure, compare and improve. You had Rebecca as kind of a North Star, but how was it to measure what you’re doing against other B Corps and see your benchmarking and tangible ways? Did you look at other companies? And who were those companies you used for specific benchmarks during the process?

Immer: Our biggest goal for this was to get over that 80 minimum point score you need to achieve it. I think beyond that, we know there’s a lot more we can be doing. We were worried it would become a little too burdensome, again, to use that word. If we’re trying to go too much farther than that. For years, Charlie, and I’ve been saying that we want to be the Patagonia of bread, which is relevant in some ways and not relevant in a lot of ways. But just an organization that, within their own industry, is pushing the edge and seeing all the benefits that come from being part of leading the pack. And a few other organizations as well. But that was a really inspiring thing, and we thought, “There’s something about that, and we want to be applying to this.” And then of course, from working with Rebecca and the Impact Growth Partners organization. They were really helpful in sharing references with us of both manufacturers or folks in other industries that were both small businesses and large businesses. We were able to check out their websites, hop on some calls with some of those folks that were facilitated by Rebecca and her team. I think that whole combination of having a few organizations that Charlie and myself others at Chabaso really were inspired by, and then being able to have these connections with other emerging B Corps across the country, all formed as a really valuable reference to help us see kind of how we could fit into that whole ecosystem.

Spencer: It’s funny that you mentioned Patagonia because very early on in this conversation, I was thinking about Patagonia. And when I mentioned that, I think if more baking companies could become B Corp certified, it could change the general public’s perception of what food manufacturing really means. And I was thinking you’re off to such a great start because you are in company with companies like Patagonia and that says so much about you as a bakery.

Immer: I think it’s really exciting to be given some access to the same room as all these folks. It always feels good to be the dumbest person in the room. That’s what I tell myself.

Spencer: I love that.

Immer: But we’re in the room. So we have a lot to learn.

Spencer: I love that. Let’s talk about that overall impact score. You had to get an 80, and it looks like you landed at 85.4. So that’s pretty great. You nailed it. But how many tries did it take? Two? Three?

Negaro: This is our only actual formal try of submitting a score. Every other attempt was still the internal challenge of making it totally through the Impact Assessment. And that assessment is the bulk of the work. You get to question 140. And you’re like, “Oh. This is hugely challenging to either extract the data to answer the question,” and we stalled out three or four times.

Spencer: These aren’t like multiple choice questions or yes/no questions. These are hundreds of really hard questions that require a lot of information, right?

Negaro: Yeah. And some of them actually are kind of multiple choice and depending on how you answer them, you get varying degrees of points. There’s an opportunity in all of them to think about how you do things. To get to the point of actually submitting what you think your score is to B Lab, to get vetted, is a huge effort.

Immer: I think one of the few differences between this most recent effort and past efforts at Chabaso was … there are a few initiatives / internal projects that started at Chabaso that really aligned with the B Corp questions and helped us to push ourselves over that finish line, which we weren’t necessarily doing to that same level in the past. There are certain questions that you can get point five points if you do this thing. And there’s other questions that you can get 10 points out of the 80 to do this thing. And two quick examples of that, we’ve really formalized some of our bread donation processes over the past year. Donating bread has always been a huge part of Chabaso’s DNA, but I think we got to a point where we had established a lot stronger relationships with these food banks and food donation agencies in the area that made it so much easier for them to be picking up product that we were hoping to be donating.

And then also kind of a big thing for this time around was we had changed some of our hiring processes and partnered with a resettlement agency called IRIS that helps refugees and displaced peoples from different countries around the world that are arriving in New Haven. They help them get housing, learn English, figure out their healthcare situation and get them job opportunities. And we’ve already had a relationship with IRIS for years. But we started to really make that a part of our hiring process. And that really gave us a lot of points. It’s an amazing thing that we’re doing, and we do it just for the sake of doing it, and it also helps a lot with our hiring struggles at Chabaso in terms of finding folks that really want to take on this really tough job of working in a manufacturing facility. But connecting those dots with that area was a major difference between this time around for the assessment in terms of getting us over that 80-point minimum and previous iterations.

Negaro: It’s things like someone listening to this could be like “That’s not a big deal. We donate stuff or anybody can donate stuff, or anybody can hire people from different groups.” But it’s the actually formalizing it in shifting the organization towards being able to know how to do this in the most impactful way that makes you realize how actually important these things are. Like Reed was saying, we’ve always donated bread. We’ve always had this relationship with IRIS. Some of these things is also just the luck of the timing. It’s because there’s this huge number of Afghan refugees coming into this country right now that need a stepping stone into a new life. And it’s not a temporary thing. And IRIS sets them up, and we were happy to help them with that first stepping stone of getting a job. And at one point in January, we had more than 20% of our hourly workforce was Afghan refugees. And 2022 would not have been possible without them, for us. Some of them have gone off and started their own businesses or they’ve gone and got other jobs. A lot of them are still with us. Manufacturing has been the first step for a lot of people. Like Reed was saying, it’s a hard job. But it gives a lot of people a first start. I guess the secret sauce in all of this is like we were talking about before, it’s the formalization of it that makes it work even better.

Spencer: That’s a good lead-in to the last question for this episode, and that’s circling back on that self-reflection. Do you think that this process took you from feeling like, this is the kind of company that we want to be or that we believe we are, to this is who we are?

Negaro: Yeah.

Spencer: Did it change how you see yourself as a company at the end?

Negaro: At beginning of this, Reed said that we’re always trying to basically de-commoditize a commodity product. And I think it’s important to say that it’s not like we’re doing anything different with bread. We make artisan bread, and it’s the highest quality we can make. The bread is not changing. It’s how we do things and with whom we do it is what becomes the most instrumental thing that we do. People use the word culture with some reckless abandon sometimes. But when you’re in a culture — or lucky enough to be leading or responsible for a culture — that’s clicking, you really start to feel pretty protective of it, and you start to feel very fortunate to be a part of it. It’s a daily reminder that this took a lot of work, so let’s make sure we keep this thing going. I have this probably terrible metaphor, where to get a speedboat out of the water it takes a lot of effort. But once you get it up on the plane, you can throttle back and keep it there. But if you take your foot off the gas too much, it’s back down on the water. And you’ve got to put all that effort back into it to get it back up there. It’s really important that we have this compass, like Reed called it, to help us navigate how we do things.

Immer: Joanie had asked if we’re more confident now that this is who we are. I think, definitely, we are a B Corp now. And that’s in writing; we got that proof, but not necessarily in terms of we’ve reached the end point of what it means to be a force for good in the world and a good business. I think the importance is in seeing this as a starting point and who we are. We’re somebody who, day to day is working to chip away and push forward in these areas to more and more be developing this and bringing these ideals into reality. Because there’s still a lot of work of us communicating the value of this throughout the organization and seeing how this relates to folks’ day-to-day responsibilities, and how this can help us do a better job, and have everyone be more proud of what we’re spending our time doing. So I think seeing this as a starting point and who we are as somebody who’s willing to keep that hard work day to day and more and more trying to chip away and bring goodness, however we’re defining it, into the world. I think that is who we are. But we’re not trying to be like, “We did it, we’re perfect, we’re all good now time to go home, guys.” And I think that’s an important attitude to have.

Spencer: That’s such a good note to end on. And a great way to plug the next couple of episodes because we are going to get into that. So today, we really dug into what it took to get here. But now that you’re here, you’re right, it’s not the end. So we’re going to look at what’s next and how you use this. Next week, we are going to look at how Chabaso operationalizes these values on the bakery floor. And Reed, like you said, being a B Corp in a manufacturing space is very different than in a white-collar environment. I’m very interested to uncover the ways that Chabaso’s values as a Certified B Corp is shining through for the workers and in the process on the plant floor. We are going to visit with Rich Jamesley, the VP of operations and supply chain, to get his perspective on what it’s like from the operations perspective as a Certified B Corp. So I’m really looking forward to next week. But for today, Reed and Charlie, thank you so much for your time and sharing your perspective on the hard work that you put into gaining this incredible certification.

Immer: Thanks for having us.

Negaro: Thanks, Joanie.

Welcome to the sixth season of the Troubleshooting Innovation podcast. Joanie Spencer, editor-in-chief for Commercial Baking, visits with various members of the team at New Haven, CT-based Chabaso Bakery. Hear about their journey to becoming a Certified B Corporation and building a business as a force for good. Sponsored by JLS Automation.

In this first episode, you’ll meet Charles Negaro, Jr., CEO of Chabaso Bakery, as we delve into Chabaso’s values and practices.

Learn more about this season here, and listen to Troubleshooting Innovation on Apple, Spotify, Google and Stitcher.

Joanie Spencer: Hi, Charles! Well, can I call you Charlie?

Charlie Negaro: Yes, please do.

Spencer: How are you, Charlie?

Negaro: I’m good, Joanie! How are you doing?

Spencer: I am great. Thank you so much for joining me for this season of our podcast. I’m really excited to take our listeners through this journey.

Negaro: Well, thanks for having us. We’re really excited to talk about it.

Spencer: I think the first thing we need to do is talk about what a B Corp is. I just have a quick little definition, Certified B Corporations are for profit businesses that have met the highest standards of verified social and environmental performance, public transparency and legal accountability to balance profit and purpose. They’re certified through B Lab, which is the governing body of B Corp certification. Before we really get into how you became B Corp certified, I want to take this episode to get to know you and your bakery. Because the truth is, and correct me if I’m wrong, but a company doesn’t just wake up one morning and decide to become a B Corp certified company and then figure out how to make it happen from there, right?

Negaro: Yeah, totally. It’s been kind of a 15 year process for us.

Spencer: Exactly. The first thing I want to do is take a look back at the history of Chabaso’s core values and practices to see how you were operating with these values that align with B corps. Then see how the certification process flowed from there. Let’s take a step way back in history and talk about how Chabaso Bakery was born from Atticus, and how it has grown into the company it is today.

Negaro: Sure, totally. My dad started this business or businesses in 1975. My dad was a lawyer, who there are probably many people who are more mismatched for that profession than there are my father. It took him I think most of his adult life to figure out that he was really an entrepreneur. And he ended up buying a used bookstore for basically the price of like the inventory that was going out of business. And it was called Atticus. The name Atticus actually comes from the first publisher, first Greek publisher that published the works of Cicero. It’s actually not Atticus Finch, first fun fact. And the the used book business was a great thing to be in, in the 70s and early 80s, used books, not even new books. And in 1981, they opened a Bookstore Cafe in downtown New Haven, inside the British Art Center, which is a Yale building. And that was the first building in downtown New Haven that kind of started to transform the city. It’s also a concrete box. It’s a museum, so it doesn’t have any kind of fit outs for like baked goods or kitchen, no hoods. So to make this thing possible, we always had to have this like little off site kitchen that was staffed with Yale art students or spouses or partners of Yale students or Yale professors. We’ve relied on this creative energy of all these people. And that really was this foundation for Atticus. And then that turned into Chabaso in about 1996. Because we were baking bread for our retail stores and my dad had the idea of wholesaling it. Chabaso is the combination of the names of me and my two sisters, it’s Charlie, Abby and Sophia.

Spencer: Love that.

Negaro: Yes, still remember this day in 1990 something, where we sat in our kitchen and my dad said, “I want to name this after my three kids.” We all figured out the name and it all just kind of came together. It was a fun little collaborative family moment.

Spencer: That was so awesome. And, I did always assume that that Atticus was named after Atticus Finch. Already I’ve learned something right out of the gate.

Negaro: Yeah, we’ll come up with t shirts or something.

Spencer: You should have it says Atticus, not as an Finch.

Spencer: So Charlie, you have a lifelong experience in this family business with both Atticus and Chabaso. I met you a few years ago. And I remember when I visited Chabaso, at that time, your main involvement, I think you were the owner of Atticus. The day I met you, you were doing some R&D and tinkering around with some Atticus bread in Chabaso Bakery. I remember there was this little mini R&D space inside of the plant. From a baking standpoint, how did you get involved in the business? And how have you kind of grown that because I think you have a really interesting story to tell.

Negaro: Yeah, it’s like, there’s this giant rubber band attached to me. As hard as I’ve tried to run away from the family business and New Haven, the further I’ve gone, the harder it snaps me back. My sisters love to remind me of that. I had done summers making bread. And even now it’s hard, but like back then it was like really hard. I kind of liked the flow that comes with doing something hard all day. But it took me a long time to actually fall in love with bread, probably because I grew up with it. I started working in the family business in 2006, I did the Chabaso thing from 2006 to 2016. from production to COO. I had this experience of going to the bread lab out in Washington. I remember kind of going out there with this thought in the back of my mind of like you can’t change the world by baking bread. Then seeing all these people out there who are like actively changing the world by baking bread, I think the first kind of like a moment you could call an epiphany was like actually standing in a wheat field. And never having done that even though going through like 25,000 pounds of white flour a day. I didn’t even know what the wheat plant looked like or what milling was. That kind of shocked me a bit. And that, among other things led me to think back to all these wonderful things that I grew up with that Atticus, that all the creative energy was producing. And that had all kind of gone away and spent three or four years from 2016 to 2019. Just working over at Atticus just the retail store in New Haven and had the opportunity to try to kind of bring that stuff back while layering in this newfangled idea of fresh milling specialty grains and maybe even trying to grow them in Connecticut. Then in 2019, I had the opportunity to start to run both of those businesses. I think that’s probably right when we met each other, which seems like yesterday and 10 years ago.

Spencer: I just love that story. I’m glad you talked about your experience in the bread lab, because I knew that was a pivotal moment for you. I remember you telling me that story. I think it’s really important to put it into context with how Chabaso makes bread and goes to market. So this bakery, Chabaso started with this mission to make good bread in a town that’s known not only for its intellectual culture, with Yale, but also food culture. How did that lay a foundation for the principles of quality bread that you still live by today?

Negaro: Yeah, we always get the question, because New Haven is famous for pizza. And to some degree Lenders Bagels started in and around New Haven.

Spencer: Yeah, that’s right.

Negaro: And I grew up eating Lender’s Bagels, and everybody asks us, is there something special in the water that makes New Haven pizza, “New Haven pizza”. I think that’s like part of the background. And New Haven is very fortunate that it has Yale in the backyard. The amount of different people from different backgrounds and different cultures and countries that it brings here. It is a melting pot.

Spencer: I feel like being located in a highly intellectual community has to sort of help feed your desire to create something that’s a little bit more complex than just were making loaves of bread and selling it. There’s just sort of higher standards in the area of where you are. Do you feel like just from a culture standpoint, it helps your perspective in how you want to change the world by making bread?

Negaro: Wow, that’s a great question. Yeah, there’s definitely like when you have other people around you doing incredible things. It raises the bar significantly, when you go to school with people who are children of relative geniuses, it raises the bar quite a bit. And then there’s just an expectation of when you have a multicultural, extremely international group of customers, like people move here from San Francisco and live here and they expect a certain thing. I think there’s a lot of incredible creative influences. And then just an expectation.

Spencer: Yeah. I mean what you’re making is definitely artisan bread. But the definition of artisan and can be highly subjective. And my visit to Chabaso was one of my first lessons. I remember the story I wrote, and I think I even opened it with “Beauty is in the eye of the beholder, and artisan is in the eye of the breadmaker.” Because there are so many factors that go into what makes an artisan loaf. For Chabaso, one of those factors is the people and the principles behind your bread making process. How do those support your definition of artisan bread?

Negaro: Yeah, totally. We’ve had to come up with our definition of that, for a buyer or somebody, when we’re getting a tour or trying to do that whole, “this is why this is worth this amount of money, like this is the value in this” sales pitch. We’ve had to define artisan and some simple words. But like you’re mentioning, it’s not simple. On the manufacturing side, it’s the differentiation between like the time and temperature between what we do and what you call kind of like a no time dough. We’re using a lot of prefermented doughs, we have long bulk fermentation times. And that’s very challenging, in terms of getting extremely high throughput, finding machines that work with this process. Since the beginning in the 90s, putting in machines, for some level of automation has always been, like this kind of works, so let’s put this thing together with this thing. And you have enjoy that process. And then the day to day operations of it, and how it interacts with the staff is just everything. If your team doesn’t understand that every day, things are gonna be a little different. And the desired outcome is collectively making something that’s special, it’s just not going to work. They have to get that this thing is a challenge. And there’s some creativity involved. But it’s also a very well defined process. And to get your team really believing that you have to value them and respect them. And this might sound kind of like, “duh”, but you really have to listen to them. It can’t just be this is how we do things. That fundamental collaborative approach starts so many conversations between you, as a leader or any leader in the organization and the team that it creates a culture. I guess, in some part, probably, when we first heard about B corps, 15 years ago, it was like, “Oh, this makes a lot of sense.”

Spencer: I loved your transition from automation to how the people are still important in your in an automated process. So you’re doing it a very specific way. And you’re doing it the same every time and an artisan bread, like you have to have certain parameters for the process to get the finish love the way it’s supposed to be. But what are some of those times where you’ve been able to sort of brainstorm with the staff and give them a voice of I think we could do it better if we did it this way.

Negaro: Yeah. The funny part is, they come up with those things on their own. You just kind of have to stand there and watch how they’re doing something. And go, “Oh, how did you think of that?” Show me what you’re in a very unaccusatory way, which is really tough. It’s like, “Why are you doing it that way?” They’re like, “Because it works better.” It’s like, okay, but please tell me more. So I can like make sure everybody does it that way. The days where it comes out perfect, are almost worse than the days where it doesn’t come out. Because you’re like, “Wait, what did we do, right?” Because when you do it wrong, it’s real obvious. And we know what we did wrong. Like we forgot salt, we forgot yeast, we over proofed i. It was 85 degrees in the room today, the air conditioning failed. The points of failure are so much easier to identify than the points of success because perfection is the common I have like 10 different things going right at the same time. So those things come from your staff doing something on the line, or with a mixer or with an oven that you never would have thought of.

Spencer: I really saw that when I walked the plant floor. Those years ago, there is this element of collaboration in your bakery. I think that’s why Chabaso’s story is about way more than just the bread, and how it’s made and who it feeds. I’m going to kind of shift gears here for a second. Your dad, I remember, he told me a story. He told me lots of stories. That’s one of the greatest things about your dad. But he has always believed in doing good beyond just making good bread. And he’s always seen purpose in the breadmaking. And he told me that if he had three wishes for making the world better, one of them would be to have healthier kids. And to start that with how they’re fed. I feel like that’s sort of a defining element of Chabaso as a bread manufacturer. I think that is not a typical of bread manufacturers, because I think there are a lot of them who feel that way. But I think it’s very different than what a consumer would assume a company that makes bread in a factory, they would not assume that a company would feel that way. Can you tell me how it’s been that defining element as a manufacturer?

Negaro: Yeah, yeah. So my, my dad is, he started this business when he was 50, the bakery business. So he started a lot of things late in life, including a family and his brain is always thinking about how much he can kind of affect the things around him in his community, his family and sticking around to see as much of it as possible. So he’s always like I’m going to live for another 30 years. From the very beginning, we were really focused on like, not bringing in the wrong ingredients, you know, process of like, bringing in enzymes, like 10 years ago was like, “What are these? Do we want to do this? Does this change who we are?” Meaning like the business debated it. There’s these things that you’re actually kind of making me think about for the first time in a long time that were very foundational and who we are, and those enormous experiences, affected our day to day, and started to then turn into other projects and ideas my dad had for the community in the bakery. And my mom’s starting a garden out back where she just planted like 20 by 40 feet of tomatoes, and to deal with those consequences. That started New Haven farms, which ended up being a diabetes prevention program in cahoots with a local health clinic that would prescribe a share from the farm. Which was much more than our backyard at that point. And part of the prescription from the primary care physician would be you get vegetables every week, we’ll teach you how to cook. I remember, a local chef was like this is a kohlrabi … here’s how to cook it. And you had to show up you had to do some work on the farm, which was just a urban little thing. And you had to kind of get schooled on nutrition. Those little initiatives that my dad started turned into a lot of different things in around New Haven.

Spencer: Wow, the thing that’s so cool is that it wasn’t just your dad living out his values it has translated into the business and it’s grown. And it’s become something very organic, that now you are carrying on. Now I kind of want to shift the focus back to you, Charlie, you talked about that first time you stood in a wheat field and the impact that it had on you and how you’ve carried that through your passion for breadmaking. And now you’re pretty involved in local state and regional agriculture. Can you kind of talk about your journey, and how breadmaking is running much deeper than the production process from an agricultural standpoint and a community standpoint?

Negaro: Yeah, I know you asked about me, but to have a bakery, making bread successfully and profitably and also be mission driven is the job of many, many people. You know, without people like Reed and our VP of operations and supply chain Rich, and many, many others, it just isn’t possible. You can’t run a bakery with all that’s involved in that and kind of be off galavanting and wheatfields. And be like, look how amazing that is, it tastes so good. And I am like I am trying to make a truckload of bread right now. So it’s a work of so many to take that believe in it and carry it forward. It’s also a very interesting kind of journey and process to go from, like an operating role to a CEO role where you’re going from, that operating of a manufacturing plant to a here’s who we are, here’s what we do, here’s why we do it. And it’s fun and interesting shift that is super challenging. And again, impossible without the right people. The first thing that started me really down the path of growing interesting grains really clicked with me and with us was to actually taste better. That we are leaving, not just flavor on the table, but no pun intended, but leaving nutrition, and so many more aspects of things that we can be including in our food. Unfortunately, I am a lot like my father, so I tell a lot of stories. But there’s this moment after coming back from one of the trips from Bread Lab, and having gone with him to like a barley field and learning what barley was and learning what malt was. And that just the malt industry is just very singular and what it produces. And someone made this like specialty malts and put it in vanilla ice cream, and it tasted like all sorts of different things. And like, Wait, did you put pineapple on this? Like, nope, that’s the malt site. Okay, cool. So we’re definitely screwing up, we’re missing something. Why are we as a society, like accepting these flavors that people are giving us that just like aren’t that great? That’s really what gave us the mental support, confidence to come back and say, “Okay, we’re going to try to grow grains, especially grains in Connecticut and see how it goes.”

Spencer: And how is it going?

Negaro: It’s really hard. So this was like a prepandemic project that started, failed a couple times and then restarted. And the wonderful thing that we’ve experienced in the last five years of working together, Reed and I is we start these little projects. And someone usually goes, that’s a great idea. I’m gonna go do it. If we ended up being the instigator of one good thing for more than happy with it. Right before the pandemic in October of 2019. We did our own little bread thing out at Yale, called Brain Gab. It brought together a whole bunch of people. Again, Reed did all the work. And out of that someone else carried the torch and has started like a Northeast Grain Alliance. They had a mill they had a malt house that’s been growing. And if we had a tiny part in playing in, I would say incubating that but pushing it or nudging it along, we’re extremely happy to have that happen. We’d love for someone in Connecticut to start a mill so that we can continue it. Part of the process also with us with growing wheat in Connecticut was, Connecticut actually has a lot of farmland, and the primary output of that is actually flowers. Right behind that is feed corn for cattle that makes commodity dairy. If you’ve ever known a dairy farmer, you’ve known that they probably work 70 hours a week don’t get paid a lot of money and die young. There’s lots of farmers out there that are dying for something other than what they’re currently doing. They don’t know what to do and they’re relatively risk adverse because they’re right on the edge anyways, it worked pretty well for us. What we have learned is we really want to help support people who are already doing something and that’s where CT Food Launchpad has kind of come in.

Spencer: Let’s talk about that. I mean, I think the work you did with the Connecticut farming was sort of prepandemic but then CT Food Launchpad came after the pandemic right?

Negaro: Yeah, it happened when we went to go open our second retail location and then I give my dad like a lot flack for having like 42 ideas before breakfast. In retrospect, it’s like “Wow, I should probably stop making fun of him.”

Spencer: That’s why I’m sitting here giggling.

Negaro: Yeah, right before like March of 2020, we signed a lease for a second Atticus, in New Haven, it of itself was a crazy idea. But it meant that we had about like eight months to kind of like figure out what the heck we were gonna do with this 2500 square feet. And we’d been talking to the city in New Haven and the state of Connecticut. And they were they still are and very supportive of incubating food businesses and startups. One of the very popular ways to do that is a shared kitchen, or kitchen spaces that people can rent for a food truck or a small food business. And we thought, we’ll go and do that, we’ll make that part of this 2500 square foot, we’re also going to put a bakery in, we’re going to have like a big commercial kitchen and a grocery store. And we’re going to sell stuff, and we’re going to do coffee and so on. We needed to kind of evolve that idea. That pretty quickly flipped over to instead of renting our space to other people, we will help folks make something and get it to market and sell it for them. We started to make baked goods for sanctuary kitchen is a nonprofit in New Haven that helps refugee and immigrant women who cooked at home get a job now that they’ve landed in a new life.

Spencer: Wow.

Negaro: Yeah. They do that through catering. It’s a great model, it makes a lot of sense. We started making a bake good for them selling in our retail locations, and then giving them a percentage of those sales. So all they have to do is come and show us recipe, we’ll scale it up for them and make that happen. We’re like, this checks a lot of boxes, we don’t have to really do anything new. We’re just using our existing staff. We don’t have to, like manage outside groups. And that worked. Not hugely impactful, it’s not like all of a sudden you’re selling significant quantities of this to fund a profit. And then throughout this, we had other people coming to us and saying like, can you help me make not baked good? Like, can you’ve helped me copacker for a hot sauce? I’m like sure we’ll try. After that it evolved into, so there’s people who have market ready products that they’re selling at a farmers market, or through an online store or through their kitchen, and they want to take it to the next step. They want to take it to Whole Foods, they want to take it to another retailer. This is what we do all the time, we go to retailers and say like, here’s our stuff. Let’s do this. Having talked to these startups remembered that process of like, these are very different skill sets that you need to be developing as a person in your kitchen. It’s like you have to learn how to make this stuff. You need to learn how to package the stuff, you need to learn how to sell it and do accounting and do a business plan and then you need to learn how to like, go to a retailer and distribute it, sell it, make it and make it food safe. That’s something that we do all the time. So let’s try to help local businesses do that. They don’t have to learn it. Why have 10 local food startups go and learn this thing, when we already know how to do it, and we can just they can focus on what they do best. Make this really special hot sauce. That’s what CT foods Launchpad is now it seems like it’s that’s what it’s going to be for a while. Again, Reed has helped, there’s a Ghanaian hot sauce called Shito that with our help has gone through with two retailers and is now carried in Stop and Shop.

Spencer: This concept is amazing and that you’ve turned that space sort of into a training and education facility for startup food brands. Right?

Negaro: Yeah, this space is virtual, it’s Reed and I. Coaching might be a little self aggrandizing but act of listening to folks go through the things that we’ve gone through and telling them that it’s going to be okay, when they’re struggling with a growing business, and probably accidentally it has worked out perfectly because our new location is also a little micro grocery store. If I had my druthers, I would spend all day long shopping for small cool food items and merchandising them on our shelves. It fits perfectly with you know, identifying emerging products that we think we can help grow. It’s stuff that we sell that we believe in and then we can take to other people and hopefully help them expand.

Spencer: That’s amazing. And there is such an explosion of emerging brands right now. The space can get a little bit crowded for new brands. And so many of them, like you said, they don’t know sort of what they don’t know and need help getting kick started. I love Launchpad, it is such a perfect name. What a cool point of evolution for your company. Because when I looked at the CT Food Launchpad website, it does say that it’s powered by Atticus and Chabaso. It seems like you’re using both companies for good as you typically do.

Negaro: Yeah. And it’s, you know, it’s like, you have to find things that you find are fulfilling for you, and for other people to really believe in them and make them part of your culture and make them stick. We’ve never been the best at putting like a sentence or two around, like”Who are we? What do we do? Why do we do this?” The vision mission kind of wordsmithing sessions of yesteryear are where I always found kind of like personality tests. It’s like this is gonna change tomorrow. But we’ve gotten there through our actions. And it’s also part of the reason why I loved B Corp. When I first heard about it 15 years ago at this like random seminar, I just happen to go to because it gives you the words and roadmap to make sure these things that you’re doing are clear to yourself and others and that they stick around.

Spencer: Yeah. I’ve heard that so many times. It’s kind of what we’ve started this conversation with that you don’t just wake up one day and go, “You know what, I think I want to be a B Corp. Let’s look and see what it takes to become that kind of company.” You learn about it. And then you look at that process and that checklist and realize, this is like how I’ve been living. This aligns with how my company operates. Is that how it was for you with Chabaso.

Negaro: Yeah, pretty much. I think there’s probably people who do want to utilize like the B Corp name and what it stands for, for aspirational growth, either honest, aspirational growth or non. But it really should be a tool that feels very familiar. It’s a 280 question process, where you have to go through and score a minimum of 80 points to qualify as a B Corp, even the most forward thinking companies who are already doing good, struggled to score 80. The questionnaire in and of itself is like part of the process to go, so here’s some things that I’m like, kind of doing but I need to do differently or more formally, to qualify us to get these points. You’re not going to make it through that process, the four or five times that we had to do it to get yourself to where you need to get to.

Spencer: Yeah, and you know what, that is exactly what we’re going to talk about next week, we’re going to really get into the nitty gritty of how you navigated the certification process and what exactly it took to get there. But I’ve loved this conversation, because I feel it was really important to let the audience know who you are. And just like you said, getting that certification, I mean, that questionnaire is long, and it takes a lot of self reflection, and you have to kind of already be moving in that direction. I’ve really loved just hearing this story of Chabaso and how it came to be and who you are as a company that fits into what it means to be a B Corp. And over the course of these five weeks, we’re going to look at the process to obtain certification. Then we’re going to talk about how you operationalize those values on the bakery floor. And then B Corp certification, you don’t get certified and then it’s done. You have to keep improving and get your recertification. I want to dive into plans for the future. And then finally, finish with what the secondary benefits are for being a B Corp. That’s kind of what the lay of the land is for the next few weeks. But next week, we’re going to talk about that process and bring read into the conversation to really hear those details. So I’m looking forward to that. But for now, thank you so much, Charlie for spending this time with me today.

Negaro: Well thanks, Joanie, for giving us the opportunity to talk about it. It’s been great.

Spencer: And I will talk to you next week.

Negaro: Talk to you next week.

Welcome to the fifth season of the Troubleshooting Innovation podcast. Joanie Spencer, editor-in-chief for Commercial Baking, talks with Rebecca Abel, owner of D’Vine Cookies in Taylor, MI. They’re looking at cookie production through the lens of an entrepreneur, from starting a bakery to moving into the first big facility to strategic growth into the future. Sponsored by the National Honey Board.

Our final episode explores strategic growth in the baking industry. How are business plans and capital investments changing as we head out of pandemic trends and into a new world of workforce challenges and supply chain disruptions? Abel shares how she’s pivoting, especially after learning so much at this year’s International Baking Industry Exposition.

Learn more about this season here, and listen to Troubleshooting Innovation on Apple, Spotify, Google and Stitcher.

Joanie Spencer: Hi, Rebecca. Thanks for coming back for week five!

Rebecca Abel: Hi, Joanie.

Spencer: Let’s start off with D’Vine’s growth. It’s really happening at a pivotal time in our industry. Because relatively speaking, we seem to be heading out of the pandemic, I’m going to knock on wood really quick. And bakery consumption is trending upward. The American Bakers Association just released their most recent research ‘Life Through the Lens of Bakery’. And it looks like pretty good news on the consumption front, especially with indulgence. How are you feeling about D’Vine’s spot in the cookie category right now?

Abel: I’m feeling really good about it. I think that indulgence is a category that seems to be taking off in really every regard, whether it’s desserts or luxury items. This whole luxury industry is hot, and we’re an affordable luxury. It’s something that the mainstream can afford a really indulgent cookie. I like the category and being able to use products and the types of ingredients that fall into that category, because I also enjoy luxury. If I’m going to have a cookie, I want the best cookie.

Spencer: Right. When you look at where D’Vine is right now, and doing well in the category and what your plan was when you started the business. Are you where you expected to be at this point based on your business plan? And what’s changed?

Abel: Yes. People ask me that all the time “Oh, are you surprised that you’re as big as you are at this point?” The truth is, no, because it was very intentional. My goal was only to build a really large company. In my mind, I just showed up on the scene to start the business. Everything I’ve done up to this point was just getting ready to start. This is the first year and now that I’m in a facility big enough, I’m just showing up as a company that is looking to grow. Our plan is to start from here. And again, to me, this is just the start. And to launch and to over the next several years to grow and to be a nationally known brand. That’s where I saw things and intended to be though before I even started the company is to be a company that was known like Godiva Chocolate or Haaagun Daz, or one of these really main dessert players in the market that people go to for an indulgence in that category.

Spencer: I feel like the years leading up to where you are right now were almost pre-startup. And now it’s startup.

Abel: Absolutely, yes. I’m an ambitious person. It was all about learning and getting ready to be right where I am right now. To enter the field of a potential company in this sector.

Spencer: Right. You are like moving along, according to your business plan. When you’re looking ahead, have you had to change your business plan at all based on what it’s taken to get here? Or are you just still right on track and you’re moving along as you had originally planned?

Abel: Well, of course, I’ve had to make a lot of little pivots. I didn’t know that my growth was going to come from contract manufacturing or private label, because I didn’t realize it was such a big part of the industry. It’s not that I’ve changed my plan. It’s just that I’ve added learning what’s out there as additional ways that I can grow. Things are a daily pivot. As I try certain products in certain ways of selling my products, I have realized it’s a learning curve of: what do we like, what are we good at, what are we not good at and what does our facility not work well with? It’s even facility specific. We have X amount of storage. Can we do this type of product that requires this much more storage than we have? Well, no. Let’s pivot to other less storage and heavy type of product. It’s daily, small pivots in a bigger game plan.

Spencer: One thing that happened this year was that you got connected with an industry veteran, Dave Van Laar.He was able to work with you just in time for IBIE. I’m interested to hear how his help and consulting guided you with your operation. And how that helped you going into IBIE, and navigating IBIE? Because I do feel like the growth and timing in your company was really great to go into such a huge trade show, where you’re going to see all the equipment and all the ingredients suppliers in one place, and have really important conversations about the future. How did Dave help lay the groundwork for your IBIE experience?

Abel: We were really fortunate to have Dave come in and help us as an interim C level employee. He’s retired, and has lots of other passions and things he’s doing in his retirement. But he agreed to come in and help us and help me specially prepare for IBIE, in looking at different potential equipment companies for our next step of scaling. He knows every company out there being a 45 year veteran, he has relationships with every company. He was able to make some really strategic introductions for us and helped me feel less overwhelmed in that sea of lots of great companies. But not all companies that are going to be the right fit for what we need next. It was extremely overwhelming even to just be there with him. HE was showing me “Okay, let’s talk to these 10 different companies.” It was still a lot.

Spencer: Yeah.

Abel: But it was really helpful. We did narrow it down to a few potential companies that we’re going to work with for our next steps in automation that are the right fit for the next year or two of what our needs are.

Spencer: Because you do have plans right now to install a new line, right?

Abel: Yeah, we do have plans to install another line. Right now we’re at three lines. We’re looking to have a fourth and fifth line that we get up and running over the next year.

Spencer: Okay. Wow, that’s so exciting. And like I said, perfect timing in an IBIE year to be experiencing this growth and then be able to sort of go shopping at the show. That was your first IBIE, correct?

Abel: It was, I’ve been hearing about IBIE for the last two and a half years that it is up and coming. But I started in the industry, and was still a little new. I wasn’t quite automated three years ago, so it wasn’t the right fit for me to be stepping into that type of trade show. I would have been completely overwhelmed.

Spencer: Right. So what did you think of your experience?

Abel: It was amazing. I mean, it was overwhelming. But I still have so much that I’m downloading in my mind, from things that I saw and haven’t had a chance yet to even do a follow up from the show. With all of the great people that I met. I did get to go on a tour, I met somebody locally that has an extract company. And we’ve already gone into his facility and found a new ingredient partner. That was amazing to just meet some additional mentors and connections in the Michigan area. But a lot of the equipment that we looked at and we’re considering is out of the state or out of the country. So just making some preliminary plans at this point, to figure out what is the next step we’re going to take in looking at that piece of equipment?

Spencer: Yeah, I actually talked to a baker once who said, “I thought I had everything set and I knew what my next line was going to be. But apparently now I am buying a plane ticket over to Europe to look at some more equipment.”

Abel: Yeah. Well that’s where a lot of the equipment seems to be. So that is on our plan for the next six months. To go over and see a couple of great companies in Europe that we really want to see what they have in action.

Spencer: Okay, I was going to ask what were your main areas of focus in terms of where you plan for your next capital investments to be.

Abel: We’re looking on the depositing front. I mean, we’ve had great success with our V mags and have been really happy. We’ll continue using those but now we’re looking for more multi-lane depositing. and what’s going to be the next step on that front. But we want to look at all of our options and figure out what is our next best piece of equipment so that we’re not At depositing one cookie at a time anymore. We’re ready for multihead.

Spencer: Right. I think the next few questions, I do want to kind of focus more on that IBIE experience. What you saw on the show floor from all the exhibitors that you visited. How did that match up with your expectations for the show and what your current operational needs are and what you’re planning for in the future?

Abel: Well, it was much bigger than you could ever imagine. When I thought that I was through the show and then seen so many companies, I realized there was another whole hall. So it definitely exceeded my expectations. Although it was more overwhelming than I anticipated. But there were a lot of things that I didn’t know that I didn’t know that I left there, realizing, “Wow, things exist, that I had no idea that even existed”. With all the innovation out there in the industry, it’s really exciting to see what is available and what’s coming in the future and automation. I think that it’s the focus on these manufacturers to realize more and more that we really have opportunities to automate almost everything we do.

Spencer: Yeah, that’s true. And we are actually we just dropped our December Special Edition. It’s our Innovations Annual where we take a look at some of the top innovations from the year from suppliers. And it is incredible the level of automation. I mean, I couldn’t write just a story on automation, because it would be a book. Like you said, you can automate everything. Do you feel like it changed your view of how you want your operation to be in the future? Or did it change your plans for how you want your operation to be for the future?

Abel: Well, seeing the potential machines and things that were there that I had no idea that even existed, it did open my eyes. It showed me that we could be completely automated at some point with just some really great people running some great machines and taking out a lot of the really mundane tasks, such as stickering boxes, pallet stacking and just things that can save people’s backs from all this lifting. So it did change my view as to what I think things will look like a few years down the line when we can really afford all the automation that we’d like. It’s exciting, though, because I love seeing what people are coming up with to help our issues in the industry with labor. And like I said, saving people’s backs from a lot of the heavy lifting of what this job can be.

Spencer: Yeah! And we just did a story on diversity, equity and inclusion through the lens of operations and equipment, and how automation can support DEI, in terms of creating opportunities for people who wouldn’t be able to do certain jobs because of physical limitations. And so automation supports efficiency. And it gives you a great ROI, but also can really change how you look at your workforce.

Abel: Absolutely.

Spencer: So the things that you learned at IBIE, did it impact your timeline and plans for growth or for when you want to start incorporating more automation into the operation?

Abel: I wouldn’t say it impacted it. It made me excited about what is potential. But there were additional things that we want to add to our automation lineup. And, we have to be very strategic as to what comes first. And so what it did was really add to that lineup of things that are on our wish list. Yeah, you know, nothing’s going to happen overnight. So there’s just more that we want. It was being like a kid in a candy store that yeah, this machine will solve this problem. And this machine will solve this problem. And it was exciting, because there’s a lot of great solutions to daily problems we have, but we have to pace ourselves. We wish we could have it all in place overnight. But a lot of these pieces of equipment have 12 to 18 month lead times. So it’s not coming overnight, but it adds to our wish list.

Spencer: Yeah. And then there’s the lead time, that is kind of a nightmare. Did you experience that at all? Like, oh, my gosh, there’s the machine that I need for the next line. It’s not going to be installed for two more years. Did you have any sort of shock on the timeline and turnaround for installation?

Abel: Yes, because I would call it our dream machine is that at least a 12 month lead time from the time that we get it all dialed in to be exactly what we want. But the challenge is, we really need that next line in the next six months. So we are having to figure out we need an interim step machine to then have our dream machine in place, probably 18 months from now. I wish it was faster and easier, but it’s something that we just have to accept. That’s part of this market. And they’re frustrated because these equipment suppliers, I’m sure they would love to be able to deliver something and get paid for it before, a year and a half out. But it’s just the reality that in and out of this country, we’re all struggling with people to make the equipment.

Spencer: Right. I did a series on the supply chain disruption in 2021, as it was unfolding, and talked to several equipment manufacturers and ingredient suppliers. Those conversations, I never left feeling happy. It felt very hopeless.

Abel: It’s frustrating, but I think it’s hitting the equipment industry more than any other industry.

Spencer: Yeah.

Abel: Even a fridge, a personal fridge that I ordered in March of this year, just a regular refrigerator has a 12 month lead time. For dealing with that with a refrigerator and these really complex custom built machines. Yeah, I mean, I guess I should be lucky that it’s only 18 months.

Spencer: Yeah. Absolutely.

Spencer: This season of Troubleshooting Innovation is sponsored by the National Honey Board. Honey truly is Mother Nature’s sweetener, from the beehive to your bakery food. It comes from every corner of the world and provides a sense of time and place. It’s flavorful, functional and composed of a complex mix of carbohydrates, acids, minerals, antioxidants, vitamins and prebiotics. And while honeybees are making honey, they’re also pollinating more than 35% of the foods we eat, learn more at www.honey.com.

Spencer: So what about innovation on the ingredient side that you saw at the show? Did your IBIE experience have any impact on product development and R&D? And I guess looking at the machines as well, did that impact like, “I could make these types of cookies, or this is something that I want to put on the docket for the future?”

Abel: Yes. That’s really my favorite thing to look at is, what’s available on the ingredient side, and finding cool and fun ingredients that we can then incorporate news. There were a few things that I saw that really wowed me that I’m now getting samples and doing some preliminary testing not even for cookies next year, but this is now into 2024. I’m just thinking like, how can I use this? And will this work in the future automated equipment that I’m going to have 18 months from now. It’s the most exciting thing about what I do is looking at what’s out there and creating things from it. There are just such great companies out there innovating in the ingredients space as well as the equipment. And I was pleasantly surprised with how many ingredient companies were at the show. Because I went in thinking it was going to be mostly technology.

Spencer: No, it’s definitely a well rounded show. It’s every aspect of the bakery process.

Abel: Definitely is. I was very surprised. They covered everything.

Spencer: Did you feel like you have any moments where you were like, “Yes, this is why I got into this?” Because as you were describing your favorite part and being the R&D, it just took me back four weeks ago to our first conversation about why you got into this and how you were learning how to bake cookies. Did it revive that passion for you?

Abel: It did and it always does. And there were a few really exciting products and companies that I didn’t know about that got me excited about the R&D side and some products that will solve some problems that I have and making a few toppings or fillings or whatnot that we’re doing very manually that are a more turnkey solution for something that’s the quality. That is what we want. It did reinvigorate me, take me from a state of overwhelm to a state of great this is a solution and this is going to work.

Spencer: I can only imagine that it was an ebb and flow that you probably had moments where you though it’s too much to let’s to do this.

 Abel: This whole journey has been that. IBIE seems to be really social and there were all sorts of get togethers and after parties. But by the end of each showroom day I was ready for bed. Because there were highs and lows and there were things that you’d see that you’re like, “Great, this is amazing.” And then you find out “Okay, no, this is not coming for 18 months.” Or other wins that you see, “Okay, this is here and we’re ordering it next week, because this is something that we’ve been needing and having supply chain issues on.” Lots of highs and lows there. And all in all, a great experience, but a draining experience because of all the stimulation.

Spencer: So when you look to not necessarily pertaining to IBIE but just in general, looking to the future? How do you find that balance where when it comes to capital investments, finding that balance of I need to invest in this so that I can make more cookies and sell more cookies. But I have to sell more cookies in order to have the capital to invest? How do you get off of that cycle? How do you find that balance?

Abel: Well I always have to put selling more cookies before buying the equipment. Because, we don’t want to get into a position that we’ve bought equipment for cookies that we’re not selling and can’t pay for the equipment. I wish that, it was easier to just flip a switch and have the revenue immediately to afford this next line. So I prioritize finding the business to then buy the equipment. But it’s tricky, because it’s like this wish list that even the new business that we’re bringing on, that takes a long time to get in place. Contracts we’re talking and signing now don’t start some of them for nine months. It’s giving me an exercise in patience. That’s definitely something that I’ve had to learn because I wouldn’t call myself a patient person, but I’m having to be very patient in this whole process.

Spencer: I’m sure that this entire journey has been sort of a lesson in teaching yourself patients.

Abel: Definitely.

Spencer: But I do think that all of the upfront work that you did to get to the point where you are now, I wouldn’t have guessed that you are an impatient person. If I was just looking at it from a timeline perspective,

Abel: Well, I’ve learned patience in this process from the get go. In other things that I’ve done, it’s been not instant gratification, but not gratification over a five year period. In this whole startup world you have to have patience every day because things do not go according to plan. And it’s been a big area of growth for me.

Spencer: In the industry, we have a tendency to sort of look at time in three-year increments, at least from where I’m standing from the media perspective. But we look at it from in three-year increments from what changes from one IBIE cycle to the next. Where do you see D’Vine, the next time you step onto an IBIE show floor? Where do you see the company?

Abel: Fortunately and unfortunately, probably in another space. Three years from now, I think that will be just moving to our next larger space. Hopefully, in the position that we need to do that. But like I said, unfortunately, dealing with the pain of making yet another move. And I think at that point, we’ll be ready for the real big guns, equipment like the tunnel ovens and complete automated process. At least that’s my hope. Where we’re currently looking for some of these interim solutions with equipment. At that point, we’ll be looking for the permanent, we’ve arrived solutions that this is what the big companies are using.

Spencer: Do you ever envision having multiple facilities?

Abel: I do because it would be nice to not be shipping across the country, for many reasons. I do eventually think we’ll have our facility here in the Midwest, and then something on the west coast. But that’s another whole logistic and time challenge of being two different places. Daunting the idea of how hard it is to run just one facility and now getting into two. But that’s where I will definitely need a lot more help on my management team to be able to help with that.

Spencer: The last question, as you know, we were looking at the future of this company, and what your plans for D’Vine are, you’re still a young baker in this industry. It’s such a mature industry. I would say anybody less than 10 years old, is still a baby in this industry. So what’s the biggest change, the biggest wave that you think you’re going to make in this industry and then what advice would you have for a new baker coming in? And then also, what’s your advice for the established companies? Because you do have this unique perspective, what do they need to get? What are the roots that they need to get back to?

Abel: Okay.

Spencer: That’s a complicated question. There’s a lot to that question.

Abel: Well, to start out, I think the impact that I want to make in the industry is showing that you can start without having a background. That part of this journey is the process of growing and learning and the growth that I’m going through personally with this challenge. But hoping to inspire other people that they can have a dream, and really not have it all completely thought out and be completely ready for it. But just start in that direction and let it evolve, but make good decisions. So my journey is about inspiring other entrepreneurs to take risks and to start something, and to be limber and flexible in knowing that if you work hard, and you get the right guidance and make the right decisions, it can happen. So that’s the first part of that. The second part of that is what I think I can teach bigger companies that, maybe getting down to some more personalized treatment of employees, we’re taking a big company and try to make parts of it smaller, so the employees feel more engaged in the overall vision. And I’m part of a small company, so that’s comes easy to us. But I think being part of a really large company, that’s where I benefit from. Is having an environment that feels small to my employees, and that keeps them retained and part of the bigger strategies. So having one on one programs for employees to mentor and grow. I just read a great article about mentorship in the workplace. I think that is becoming more at the forefront of these bigger companies that are realizing how important that is. And how that really engages employees in the bigger picture is one on one mentorship inside of the company. So showing that is really something that can be helpful with retention is already becoming very apparent.

Spencer: And it all really boils down to the whole reason why I wanted you to be my guest the season. And that is entrepreneurship, that is what you bring. That is something that I think, is a quality that every baking company, regardless of the size, that is a quality they need to have.

Abel: Yeah, I think looking through things from the lens of an entrepreneurs is definitely a different perspective, especially comparing to how a big company might look at things. I think it’s good to look at things from both levels. It’s helpful to me to look at things through the eyes of a big company and get advice on that front to having a balance of entrepreneurship and establishment is great for all companies.

Spencer: Yeah. Well, Rebecca, I think that’s the perfect note to end this season on. Thank you so much for spending these five weeks with me. I have truly enjoyed sharing your story and walking this journey with you. It’s been amazing. Thank you so much.

Abel: Thank you for having me, Joanie. It’s been a pleasure talking to you about this. And I love what you’re doing at Commercial Baking. It’s one of my favorite things to read.

Spencer: Thank you so much. I want to give you a big hug.

Abel: Well, you guys deserve it. It’s impressive.

Spencer: Thanks again, Rebecca.

Spencer: Thank you for listening to Troubleshooting Innovation, a Commercial Baking podcast, and a special thank you to our sponsor, the National Honey Board your resource for Mother Nature’s true sweetener. For more information, visit www.honey.com

Welcome to the fifth season of the Troubleshooting Innovation podcast. Joanie Spencer, editor-in-chief for Commercial Baking, talks with Rebecca Abel, owner of D’Vine Cookies in Taylor, MI. They’re looking at cookie production through the lens of an entrepreneur, from starting a bakery to moving into the first big facility to strategic growth into the future. Sponsored by the National Honey Board.

This episode explores people development: the big issue on the radar of every bakery, big and small. Abel shares her journey with developing her own professional skills as a first-time bakery owner, while also providing training and education opportunities for her own employees along the way.

Learn more about this season here, and listen to Troubleshooting Innovation on Apple, Spotify, Google and Stitcher.

Joanie Spencer: Hi, Rebecca. Thanks for joining me again this week.

Rebecca Abel: Hello, Joanie. Thanks for having me.

Spencer: So this topic is a big one that’s on everyone’s minds, and I’m very interested to get your perspective as an entrepreneur. So first, I want to revisit the fact that you started D’Vine, with no experience running a bakery, what has been your personal journey for professional development? Not only for you, but also for building a staff?

Abel: Well, that’s a great question. And it’s really been the hardest thing that I’ve dealt with, because people is, you know, that’s the wild card that without the right people, you can’t have the right company. So I really started in the books did as much reading as I could on management and on vision and on leadership, because I’ve always been in a leadership role, but it was on much a much smaller scale. So in my other company, I have a team of two. And so when you’re just dealing with one other person, it’s a much easier situation. But here, I was coming in and started with a staff of four, and realized quickly that, you know, it’s not always simple a to have a dynamic of a group work, but be to really find the right people to do the job that you need them to do. It was a lot of trial and error, to be honest, every quarter I evaluate even still to this day, who is on my team? And are they in the right position? And are they the right fit for the company? Because if you don’t have that as a baseline, you can’t develop somebody that’s not a right fit.

Spencer: Right, exactly. So what was it like for you, trying to learn a craft and lead a company at the same time?

Abel: It was really one of the hardest things I’ve ever known. Now, it’s gotten a little less painful, because I have some after a few years now have some good solid members of my team. But it’s, it’s something that is forever difficult, because even people in their own lives, you know, can be a great fit at one point, and then they have something come up or they get distracted, or they’re just people. And so it’s always something that I have to keep my eyes on. And really, you know, I wish I wish it was easier. But it’s unfortunately not. And that’s one of the reasons we’ve really leaned into automation as much as possible so that we can have great people, but fewer of them.

Spencer: Yeah, exactly. And I think that’s what everybody’s trying to do right now. And I think you might be at a bit of an advantage because those larger companies are trying to scale back while they’re trying to increase their automation to deal with the scaling back of staff, whether it’s their choice or not, where you’re kind of coming at it from the opposite end of the spectrum, that you’re going to lean into automation to build your company without a large staff, right.

Abel: Yes, yeah, we’re trying to set it up right to be a company 10- or 20-times bigger than we are. But from right now. So the choices that we’re making with equipment and with staffing is so that we build it right from the get-go.

Spencer: So around the time you started D’Vine, we were still in the onset of that labor shortage that is now what I would call crisis level. I want to unpack that for a minute in what this labor crisis looked like from your perspective, as a small business. How did this workforce shortage, this gap, look from your perspective, as you were building something?

Abel: Well, it was something that we had no choice but to have to deal with head on. And what we found was that we might have to interview 20 people to get one person because there were so many jobs available, and fewer people than there were jobs, right? I worked with my HR manager, and we really took it as a numbers game. We could see right away that it was going to take hours and hours of phone calls and interviews. For every five people we start, one really works out. I do everything in the numbers side, so I work backwards. I said, “Okay, you’re gonna have to make 100 phone calls to get 10 interviews to get five people in the door to keep one.” So just keep that in mind. And we would figure out, “Okay, here’s how many people we need.” So those are your numbers.

Spencer: Yeah. So remind me, are you pretty much an even split between workers in the bakery and workers in office?

Abel: No, no, we have far more workers in the bakery than we have in the office. So I have four people on my management team, and then one administrative assistant. And then, at any given time, we have somewhere between 12 and 20 people in the bakery, depending on how busy we are. But we definitely have a small admin staff. But that’s where we’ve really dialed in. And my HR manager has been with me for four years now. And she’s learned with me that here’s how we’re doing this.

Spencer: You’re so lucky to have a dedicated and loyal HR person, I feel like HR has got to be one of the hardest jobs these days with everything that’s going on with labor. I asked about what the split was because pre-pandemic, it was really, really hard to find workers for the operation on the bakery plant floor, but when the pandemic hit, that’s when that sort of “life’s too short” mentality kicked in for a lot of people. And there was this mass exodus from every industry. So I was wondering, do you struggle with the administrative and office staff, keeping those employees as with the bakery plant workers as well?

Abel: No. I built that [management] team slowly, so now it’s a team of four and, like I said, it was a team of three just a few months ago, when we just brought on a maintenance and sanitation manager. But my employees tend to stay for a long time. And honestly, on the floor as well, I have good retention of once we found the right person, and we’ve decided they’re on our team, they don’t typically leave.

We moved to our new facility in July of this year. And that was a big, big challenge, because it was 45 minutes away from our other facility. So we did have some turnover with that move. But we have some people that have been willing to make that drive. We offer carpools, and we just did what we needed to do to keep as many people on board as possible. But it’s something that I have to show the right value proposition for these employees to want to stay and make it a place that they want to be. And fortunately, I think they’re excited about our growth and they believe in the product, so we’ve had good retention.

Spencer: Okay, that’s really exciting, because retention is a big part of this workforce crisis. And I hear it all the time. It’s not just recruitment, it’s also a retention. And so kudos to you for being able to build a loyal staff that you can keep, and especially with the move because that was on my list of questions. And I want to jump to that right now. The move to Taylor did have an impact on the workforce, so let’s talk about what it’s been like. You said that you’ve put carpooling in place, and you had some incentives to try to keep as much of the staff as you could. But a 45-minute drive in an era where people are like, “What’s in it for me?” when they look at their job opportunities … that’s a that’s a long drive. What’s it been like trying to keep those people and also rebuilding the staff?

Abel: Well, most of them came over initially, and we offered carpools and I gave some financial incentives to come over and a few of them with especially young children just realized it wasn’t gonna work to be able to still pick up their kid from school at three o’clock and be done with work at three o’clock. Right. So there was some turnover there. And fortunately, with some other partnerships, a lot of the employees went and worked for other businesses that we do work with. So it wasn’t that I you know, didn’t want to help them find other jobs but for the people that logistically it just wasn’t going to work long term. It was really nice of them, when we kind of knew going in that some of these people were just gonna come over to help us get established and to find new train some new people. And then they transitioned to employers back in the area that we were originally. Yeah. But this is where the numbers game came in, so that we needed to hire six new people. And it took hundreds of calls and interviews and startups, starting new employees to find the six that we really wanted to keep on our team. And were a good fit.

Spencer: Wow. Yeah, I was wondering what the labor market looked like in Taylor.

Abel: It’s actually a really good market, it’s the right demographic for the type of position that we’re hiring for. It’s a very industrial area, that was part of our decision to move there. Because we wanted to make sure that it there was enough population, and enough of the right labor pool to be able to run our company. So that that worked out because yes, there are a lot of potential candidates. You know, it’s not been easy, but it’s not been as difficult as it could have been in other areas.

Spencer: Sure, yeah. I can see Taylor perfectly in my mind from when I was there last year, and it is a very industrial area. So it’s good that you’ve got a good labor market, and hopefully not too much competition for the labor. I’m sure that can be kind of scary, too, when there’s a lot of manufacturing in the area and you’ve got to compete for those bodies.

Abel: And what I think is making it a little easier is that if people have a choice to manufacture a screw or a cookie, often you’re going to choose a cookie. It’s a little bit more exciting. You know, they can take home their work a little bit more readily than they could in certain types of manufacturing. So we get people at cookies.

Spencer: Good. I think I would probably choose cookies over screws too.

Abel: Yeah, although we do say, “Warning: This job may cause weight gain.”

Spencer: Haha, right! So next, I want to talk about training for your staff and for yourself. Just a few seasons ago, my dear friend Rich Berger referenced “building the plane while flying it” several times, and I can only imagine that’s how you must feel at times. What are some of your training and education strategies or opportunities that you’re taking advantage of, as you’re seeking to train yourself and to train your staff?

Abel: Well, one of the first things I did back in 2000 when I realized, okay, I’m scaling this company and I don’t have the complete know-how to do this in manufacturing, is I enrolled in the Goldman Sachs 10,000 small business program. And that was really … I would call it a mini MBA. I had a lot of business skills on the financial side, but this is where it brought it all together. And it was like a 4-month overview of everything that you need to be thinking about. That was a great training program for me, because it showed me what I didn’t know that I didn’t know. From there, I got a little deeper in some of those areas. I’m an avid reader, I’m a very self-taught type of person, so every day I was reading different things on management and on leadership, just really trying to get every nugget that I can to learn how to fly this plane. It’s complicated and it keeps evolving with every growth step we take. It’s evolved into a new company, really.

Spencer: Right. Yeah, I can totally see that.

Abel: So that’s how I’ve really dealt with myself, is trying to continuously learn and read and take programs that are available. And there’s also programs that I constantly see popping up through different organizations I’m in. But on the employee side, we do a lot of mini trainings and I try to take employees kind of one at a time under my wing and focus on training them in what I need to then let go of doing myself. It’s time consuming, and it’s frustrating because it doesn’t always happen right away that, you know. I can let go of something and train somebody and say, “Okay, now you’re dealing with this.” So it’s happening slowly, but it’s something I need to focus on. Because I have to get more and more off of my plate and train the people to take things over for me.

Spencer: That’s a hard sweet spot to hit, because you’ve got to make time to train people to take things off your plate. But there’s no time because there’s so much on your plate, right?

Abel: And that’s where it’s a fine balance between finding somebody to come in, that already is trained and knows how to do this. And the cost of that employee vs. finding somebody that you can grow and build with. So that’s where I’m at right now is with a few positions that I need to fill, trying to find, I feel like I can no longer continue to find people to build. I need to bring in some additional people that already have some know-how and skills to help me get to the next level. That’s what we’re looking at now: this next hire. I can’t build them from scratch.

Spencer: You are answering my questions before I have a chance to ask them because I did want to pick your brain on that, with your team-building strategy. Are you trying to hire senior level experienced people that you can then build a team under them? Or is it just getting bodies in the door, and then everybody kind of learns as they go, and then you build people up that way?

Abel: That’s most of what we’ve done so far. Although we had a maintenance person come in recently that had the know-how to run every machine that we have. And that’s been a beautiful thing, because that can be a very long learning curve. Yeah, but I’m at the point that it’s too challenging to take everybody on your team and train them for the job. So our next hire is somebody that we can’t necessarily afford the most senior level person, but I do need them to have more experience to be able to help me, so that I don’t have to learn it first and then train it. I need somebody coming in and saying, “Okay, here’s how we do this. Here’s how I did this in my last company. And let’s roll this out here.”

Spencer: So as you lean into automation, are you getting any help from your equipment suppliers in training on the equipment at all?

Abel: Yes, we definitely rely on our suppliers and their tech support. There’s also different programs locally. So there’s the Michigan Manufacturing Tech Center that I went to a course recently with different community organizations and different equipment suppliers kind of combining together. You know, I’m piecing things together.

Spencer: Right, right. So as you’re building the team, what does onboarding look like? What does it look like now vs. a couple of years ago? And how do you envision your onboarding changing as the operation grows?

Abel: Our onboarding is a lot more structured. We used to bring somebody in, and they would shadow and go through a couple of food safe classes. But now we finally recorded an entry video, so the first thing they watch is a half-hour video about our culture and our values and about where we’ve come from. We’re getting things together so that it’s a lot more professional when somebody comes through the door vs. saying, “Okay, somebody’s here, what do we do now?” But that’s been the effect of so many people having to come through the door before finding the right fit. It feels good to have this structure. Now, the moment somebody comes in, they go to the conference room for two hours, seeing onboarding videos and getting to know our company and what we stand for, what we do, then having all the different very specific trainings about the items that they need to know. And then they go onto the floor and have other trainings. So we have a structured program now.

Spencer: Okay. Now, you mentioned culture in the onboarding. That’s one of the first things you talk about, knowing that you’re doing a great job of retaining loyal employees. I imagine culture is a big part of that. So let’s talk about that. What is the culture at D’Vine? What is it that you’re telling your employees, “This is what we stand for”?

Abel: Well, we start out with the fact that we’re still really — in our minds — a startup, and what it means to work for our startup. Most of these employees have not worked for any type of startup environment and what it means: that we’re pivoting constantly and we’re still changing things. A lot of employees get stressed out by changes, but I help them understand that this is not something even to consider a stressor, like when we’re changing a recipe or we’re changing how we’re doing things, that’s just part of what we’re going to do every day. So if you view it to be something stressful, you’re going to be stressed. But if you view it as something like this is just part of what we do, then it can take the stress away. I want to help frame things into what they’re going to experience on the floor, and what they should see as stressful, and what they need to remove from that category altogether.

Then from there, we really try to develop our people, so our values are based on the acronym of P.E.O.P.L.E.: professionalism, excellence, optimism … We have this P.E.O.P.L.E. acronym that we go over, and we really try to live the acronym. We do training for employees, because I have a financial background. And I love entrepreneurship. This is really where this company comes from. We attract a lot of aspiring entrepreneurs as well. So I do classes, I try to do them on a monthly basis. For the employees that are interested in their own businesses, I do a class called “Side Hustle 101.”

Spencer: Nice!

Abel: I try to help employees understand if they’re thinking about their own business, or some of them have these side hustles already know how to think about scaling, because that’s really my passion: mentorship and entrepreneurship. So we try to help take our employees and make them feel a part of this bigger vision, this bigger goal, to be this really big company. We’re at baby step No. 2 of 20 in the process, but I think doing that work upfront really helps solidify their relationship with us. And that’s hopefully contributing to our retention of employees, that they feel part of something bigger, a bigger goal.

Spencer: Yeah, I mean, I have to say, I see where you’re coming from. And I feel like we have here at Avant have been very similar. We were a small business; we were a startup. And that was part of our culture, that we wanted to bring people in who were very entrepreneurial and thought it would be cool to be on the ground level of something that they could help grow. And we’ve been very successful in building our staff that way. I’m curious, as you bring people in with that entrepreneurial drive, do you get a lot of people who are like, yes, I want to help build this company into this big thing that we know it can be? Or like, I want to learn how to be an entrepreneur, because I have a vision to do this type of business, and I’m going to really learn how to be a startup by being here and participating in this? But you’re sort of training them to spread their wings and fly to do the entrepreneurial thing that they want to do.

Abel: I mean, it’s definitely a little bit of both. But we do have a lot of employees that are in that second category that are here to learn how to do this. You know, this is like I went into Michigan Bread to see, okay, this is where I want to be. I have employees that are just very honest from the get-go that start with a side hustle — a couple already in the bakery field — that they’re where I was maybe the first year and they want to see, “Oh, how am I going to do this?” And you know, hopefully, they’re not in cookies. But we had somebody making bagels and just different bakery businesses, and we’ll even go as far as letting them use our facility on the weekends to build their own businesses. Because I really want to work with that second group of people that want to learn how to build bigger and spread their wings. And that person is really committed to helping us because we’re helping them, and they view it as a learning experience. And yeah, they might leave in a few years when they’re ready. But you know, what I do tell people is don’t quit your day job for at least a few years. You can’t take an income if you’re really looking at scaling. You need this other income source before you can afford to go out on your own and take an income from the side hustle that you want to build into a bigger business. So I know that they’re going to need to be there for a few years and I want them to eventually though spread their wings. Nothing makes me happier than somebody going out and being ready to start their own business. And that has happened a few times now.

Spencer: Okay, that’s amazing. You just don’t hear about that very often, especially these days when employees are so few and far between, that you want to try to like get them in and keep them and not let them leave. So I think that’s really something special, to have a culture where you’re here to learn a craft that can be good in your life in whatever direction you want it to take.

Abel: I really want what’s best for people and I want to focus on what do these people want for themselves. I mean, that’s how I really have always led — and been led — is, what do you want for yourself and let me help you get there and show you really what it’s going to take. And if this is a place that you can learn? Great, that’s awesome.

Spencer: So I guess the only other thing that I want to ask you, Rebecca, is again, the whole thing that attracted me to having you as a guest this season is that you’re an industry newcomer. You have such a different perspective. And I feel like everything that you just said is a really fresh way at looking at how to retain talent in this market. But have you learned — and if so, what? — from the veteran bakers? I know you’ve gotten to meet some other bakers, and you’ve got your guys down the street at the Good Bread Company (formerly Michigan Bread). What have you learned from them, that you can apply to workforce retention? Are you learning any best practices about training? Hiring? I feel like you’re bringing a lot to the industry as it is. But are you getting anything from what’s established?

Abel: Yes, where I’m really learning from them is on the management side. That’s where I’ve really struggled with that balance of finding somebody with industry talent, or bringing in somebody new. For me, I have not struggled as much in finding the employees that are going to work on the floor in the operation, because I do feel like we have a decent value proposition, and maybe even a more attractive one than a much bigger company because we’re small. We’re a family and we can really offer this place where people can come and feel a part of what we’re doing. But where I’ve really sought advice from some bigger companies is how do I help myself in the jobs that I’m personally doing to be able to get something off my plate? Because it is really difficult. Everything I’m trying to do … it’s a 24/7 endeavor for me. I want to avoid completely burning out. But I need to find people that I can bring in at my level to help me with the job. And so I’ve had a lot of conversations about that type of employee. And that’s been really helpful of finding some avenues to grow and find that type of employee.

Spencer: It’s really smart that you’re looking at what the bigger companies are doing when you’re so successful as a small business and as a startup, and you plan to be something much, much bigger. You’re looking in the right direction. And that is a good segue to what next week’s topic is going to be, and that’ll be our last episode for the season. Next week, we’re going to talk about that strategic growth in your operation and what your vision is for the future of D’Vine Cookies. We’re also going to talk about your key learnings and discoveries from your trip to Vegas when you got to visit a little show called IBIE. So this week, Rebecca, that’s all I have for you. Thank you so much for sharing this incredible insight and your philosophies on how you’re developing your workforce there at D’Vine.

Abel: You’re very welcome. I love sharing.

Spencer: I will talk to you next week.

Welcome to the fifth season of the Troubleshooting Innovation podcast. Joanie Spencer, editor-in-chief for Commercial Baking, talks with Rebecca Abel, owner of D’Vine Cookies in Taylor, MI. They’re looking at cookie production through the lens of an entrepreneur, from starting a bakery to moving into the first big facility to strategic growth into the future. Sponsored by the National Honey Board.

This episode explores Abel’s experience of what it’s like to be the new kid on the industrial park block. She talks about her company’s strategies for capital investments, the support she’s received from having already well-established bakeries as her new neighbors, and beyond.

Learn more about this season here, and listen to Troubleshooting Innovation on Apple, Spotify, Google and Stitcher.

Joanie Spencer: Hi, Rebecca, thanks so much for joining me this week.

Rebecca Abel: Hi, Joanie. Thanks for having me.

Spencer: So this one is going to be kind of fun, because I met you right before a big move, so I’ve gotten to share in this excitement with you. But in the first episode, we talked about your decision to become a cookie manufacturer rather than a craft baker, despite the fact that this is a very high-end product that you’re making. I want to dive into that a little bit more. Looking back, how do you feel about that decision to become a manufacturer instead of a craft baker?

Abel: I think it was the right decision for me and what I was looking to create, and looking to have a craft cookie product. But I’m looking to build something really much bigger than me and to create a national brand here. It’s something that I could see pretty clearly two or three years into it: that manufacturing was going to be the route for me to attain this large goal.

Spencer: So a couple of weeks ago, we talked about the role that co-manufacturing plays in the business, and that right now, you’re really focusing on building that brand and having a larger presence nationally. What do you think about where you are with your co-manufacturing business? Are you going to stay that course? Are there going to be two parallel things? And how is that going to impact your growth and where you’re going in manufacturing?

Abel: Sure. Well, these contract manufacturing jobs that I took on initially to really start growing in the manufacturing space are something that I’ll maintain, and those are in themselves growing, and those companies are scaling as well. So I plan on continuing with those, but that’s not an area that I’m looking to grow my business. I’m not looking to bring in more clients in that space. Instead, all my growth is focused on my own brand at this point. But the two can be parallel. D’Vine will continue to grow and be a larger percentage of our business over the next few years.

Spencer: Okay, you know, I talked to a baker once who runs a very large company, and she mentioned something about how she loves and respects some of the aspects of the company that got them to where they are. But she has to know when to recognize that those aren’t the things that are going to take the company into the future. And I feel like there’s a little bit of parallel there.

Abel: Totally. Yeah, I think that’s very important for us. These contracts have helped us get to where we are, so we want to continue working with them. We wouldn’t be where we are without the contract manufacturing jobs that we took on initially.

Spencer: Right. So the next thing I want to talk about is how you took a big step recently — and I mentioned it when we opened this episode, that’s when I first met you — you were getting ready to move into a much larger facility. And last week, we closed the episode with you mentioning that you’ve been in five locations in five years. Is that right?

Abel: Yes, five locations in five years. It’s been very challenging to continuously outgrow our space, but without the right space, you can’t grow. So it’s been something that has been necessary to continue our journey.

Spencer: And that really says a lot about your growth trajectory and where you’re going. How do you know when it’s time to expand? And how did you know it was time to make this move? Because this one was pretty big one.

Abel: Well, we were really just maxed out in storage and room for new equipment. It was pretty clear after six months in our last facility that if we were to get any new contracts that we were going to outgrow it. So as soon as we got another potential large contract, we started looking because I wasn’t going to make another big move unless I had something lined up that was going to pay the bill for it down the line.

This most recent space we moved into is really much larger than we need right now. But it’s going to be big enough for when this new client comes onboard sometime next year. And ultimately, you know, we’ll probably outgrow this space in two years. The challenging thing is you can only go so big and afford to have so much space and room for growth without signing up for more than you can afford at the time.

Spencer: Right? It’s a really specific sweet spot, wouldn’t you say?

Abel: It absolutely is. And it’s a tough balance because the idea of having to move again is really daunting. These moves are really painful and expensive. And just even from permits and buildouts, this last go round was pretty excruciating and stressful. So it’s not something I enjoy doing, you know, these moves are not something that I initially saw as part of my journey, but they’ve been necessary. I just try not to think too much about them. And I’m embracing that this is going to be part of the process.

Spencer: So in each move, what lessons did you learn? Because you started with a decision to step into manufacturing, and now you’re stepping into a new facility that you’re hoping will sustain your growth for two years. A lot happened between those two steps.

Abel: Well, I learned that you have to give yourself a cushion for a lot of unfortunate things to happen in the process. So like with any construction project, it doesn’t go smoothly. You know, you spend all this money to dig out a new drain system, and you get into the guts of something, and then the builder couldn’t see that from the outset until they’ve dug down into the floor in a particular area and realize, okay, this isn’t going to work how we thought it was going to work.

So I’ve had to give myself this big cushion for problems that would come up along the way, so it wouldn’t stress me out so much to derail our moving forward. And that I think is the biggest thing about moving and buildouts and whatnot: just really knowing that it’s not going to be smooth. And you might have to switch contractors midway or, you know, fail inspections. And yeah, it’s been challenging. This last move was even exceeded any cushion that I built in for challenge.

Spencer: Wow. I mean, expect the unexpected is real. I mean, if COVID taught us anything, expect the unexpected. But that’s also a mantra, I think, for buildouts or moving into new facilities or even expansion in your operation. You’re right, it never goes on the timeline that you expect.

So the next thing I want to talk about is the equipment in the facilities that you’ve been in. We talked about this a little bit in the beginning in the first episode, but what did equipment choices look like when you first started making cookies? What were the priorities then, and what are the priorities now as you’ve moved into this full-scale manufacturing facility?

Abel: In my first facility, we had enough space for one line, and we didn’t spend a whole lot of time planning out flow; trying to make sure that we wouldn’t have unnecessary travel in the whole flow of the process. Whereas now, especially in this most recent move, we worked extensively to make sure that the space was appropriate, that we had efficient use of space, that things could flow correctly in the right direction, that there was room for the lines that we have right now and room for the next couple pieces of equipment we were going to buy.

I used a lot of advice from consultants to make sure that, first and foremost, I was getting into the right space. And then a lot of planning went into where we were putting out different electrical, different plumbing and the types of drains. So there was a lot of planning involved.

Spencer: How much work did you have to do on this facility to have it ready to install your operation?

Abel: It took us about three months to do plumbing infrastructure and to put on some additional gas lines for ovens and makeup air. The space was nice because it was a big rectangle. And that’s kind of an ideal situation where there’s not turns; it was just the right structure. So that saved us a lot in that we didn’t have to do much buildout in terms of the structure of the space, but we did need to put in a lot of plumbing and electrical infrastructure.

Spencer: What was the space previously used for?

Abel: It was used for food manufacturing. It was actually salsa. So it was a totally different type of food, it wasn’t something that was going through ovens. So that was nice, because there were already the food-safe walls and smooth, cleanable surfaces. That was really something that helped us to not have to spend a small fortune to put up, you know, FRP walls in a very large space. That made it appealing.

Spencer: Right. So we’re hoping that you’re going to be in this space for a couple of years, and there is room to grow and install at least another line. I remember one of the early conversations that I had with you as we were getting to know each other. I was sort of asking — because it’s what I do — like, “Do you know this equipment? You know, do you use this? Are you talking to this company?” And you had said something about, “Oh, I like that company, like it’s in my business plan to be big enough to invest in that type of equipment one day.” So when you look at the business plan, what are your thoughts on your capital investment priorities and strategies as you start on this journey in this facility?

Abel: Yeah, we definitely have some larger-scale equipment that we’re eyeballing for the future. And this particular room that we’re in will house the next step of automation that we want. But there’s some things that we can envision, you know, two to three years down from where we’re at right now. And that’s what’s going to cause us to elbow the space, again, is when we get into the big tunnel ovens and things that are really going to make us efficient.

That’s where our next move is going to come in. We don’t have that type of space here to be getting into the tunnel oven that will really make us productive and efficient down the line. There’s a few other types of equipment, whether it’s cooling tunnels or different things that we’ve seen, that would really help our process. But that’s going to be move No. 6!

Spencer: So speaking of operational efficiencies, you have that engineer’s mindset and it probably comes from having a finance background. You think about things sort of mathematically. It really fits in your DNA that you think like an engineer. So you employ some important GMP; we’ve talked in the past about Kaizen principles. So how have the GMPs that you use helped you get to where you are, especially as a relatively new manufacturer? How are you bringing those principles into your operation and having good manufacturing practices?

Abel: We just focus on creating systems for everything and then tweaking these systems to make them even better. So you know, with new employees that come in, there’s checklists for everything. And we just try to manage to these checklists, which are all GMP-based, because there’s a lot of moving pieces here. Everyone has to be following their checklist for the total process to come together at the end and be the product that we want and be processed in the GMP way that we need it to be. It’s a series of individual moving pieces that are really systematic, which then all have to come together.

It’s not been easy. I mean, that’s where you have to take this engineering approach on it, and make sure that it’s all systematized. But it’s really conducting an orchestra at times, and I have some great people on my team helping with that. But it’s still not an easy feat.

Spencer: Yeah. Just thinking about how our conversations have unfolded over these past few weeks, I can see this theme in how you started the business with this thoughtful approach and how you were very systematic about it in the beginning, in figuring out how to make cookies at all. Then figuring out how you wanted to get them out there to the public and the decision-making process. Systematic is the best word I can think of. And that makes sense. You seem like a person who lives and dies by her spreadsheets.

Abel: That’s funny you say that. Yeah, I do. I love a good spreadsheet. They’re necessary, though, because there’s no way to coordinate all of this without really having it all on a spreadsheet and tracking each part of it. Every day, I’m like, “Okay, I really need a spreadsheet for this.” So yeah, I sit and watch TV and come up with and work on my spreadsheets at night.

Spencer: I love it. I love it. So, with those GMPs, what kind of research do you conduct to know what systems are right for your operation? And what principles are the best ones to apply for what you’re trying to accomplish? Because there are just a ton of lean manufacturing principles out there.

Abel: Well, consultants have played an important part in that because I don’t want to recreate the wheel, right? It’s something that’s relatively complicated. So in the very beginning, I tried to figure out some of these things for myself, but then figured, okay, let me take an existing system and spend some money in consulting to find out how to really do this. And that’s when I quickly transitioned from measuring cups to scales and bigger mixers, and so on.

There’s been some people in the industry that have spent really generous amounts of time with me, just telling me how they do things. And they’re not necessarily in cookies, but I’ve found some mentors that have given me great advice. And then some amazing consultants and food scientists that have guided me with foundations in what systems to even be looking at. I don’t need to duplicate everything and make it my own, because there’s certain things that are industry standards that we’ve been able to use.

Spencer: I do feel that it could be very easy to over-engineer the process and get to a point where it’s counterproductive.

Abel: Absolutely. And I can sometimes start to overcomplicate things. I spend a lot of time taking my initial system and constantly refining things, because it’s easy to make things more complicated than they need to be. So that’s where this continuous improvement comes in. I’m constantly trying to simplify and simplify. That’s my mantra: keep it simple.

Spencer: Yeah, the process has to be simplified in order for a complex operation to be efficient. So we’ve already talked about leaning on other resources and doing research, but one thing that’s interesting about where you are in the new facility, is that you’re right down the street from another great bakery that I know pretty well. You’re neighbors with my friends at the Good Bread Company, which was formerly Michigan Bread. I love those guys. And I was so excited to make that introduction for you. How did having another bakery in the neighborhood help you get started in this facility, as your fifth operation?

Abel: They have been very helpful, and thank you so much for making that introduction. Even going to other manufacturing plants in the bakery industry is so helpful, to just see where we’re going to be a few years down the line. But these are the kinds of guys that have given me advice and have told me okay, here’s how to do this. Instead of me recreating a certain wheel, they’ve shown me things like: this is what took them a long time to dial in, these are the certain systems that are working for them, here are the ones that don’t need changing. So it’s been really helpful more than anything visually, to see where we want to go, but to have also some mentors that can commiserate and who remember being at the step where I’m at now. They can tell me some of the challenges they had here.

I’ve spoken to Mike and Spiro [from the Good Bread Co.] about staffing and how to find the right people as you grow. You know, that challenge of how you can’t necessarily afford the expert to come in at their expert’s salary. Some of these people you need to bring in and learn with them and grow with them. I’ve talked to them extensively about that issue, and how they dealt with that.

Spencer: I don’t think you could have moved into a better neighborhood. Mike and Spiro didn’t start out as bakers; they were in the distribution game. They’re also self-taught. So I was very excited to introduce you to someone who had been on a similar journey, who had the gift of hindsight to share with you so that you could sort of sharpen your lens closer to 20/20, but in real time.

Abel: Yeah, they have a very impressive operation. And they have been so helpful.

Spencer: So you’ve got your staff that you have right now, currently, and everybody’s sort of learning together as you go. And then you’ve also had the ability to lean on expertise from industry veterans and consultants and your neighbors at the Good Bread Co. From your perspective, how do you balance the advice from experts with your own ideas, as an entrepreneur, and a propensity to maybe do things a little bit differently or look at things in new ways? How do you create that balance in your operation?

Abel: It’s a good question. I’m leaning more and more toward these experts and their advice, because this is all unchartered territory for me. My mistakes are becoming more and more expensive at this point. I might have a certain way of doing things in my mind, but I’m really filtering it through the advice of experts, because I can’t afford big, expensive mistakes anymore, whereas in the beginning, I could dabble a little bit more when I was on a smaller scale and figure things out. But especially with equipment, you make a couple big equipment mistakes, and you’re sunk. So this is where I really value the advice of people that have done this before and getting what they suggest.

Even in addition to Mike and Spiro: Dave Van Laar and some other great consultants that I’ve had, some people that have really helped me at tradeshows. I’ve even had a few cookie companies take me under their wing, and these are much larger cookie companies with people who have been really generous with advice and guidance on the equipment side. They share their experience with what they’re using at this much larger size and guidance as to, you know, what to do and what not to do. I think that it’s been invaluable. I prioritize that over my own ideas at this point, because I’m really learning as I go with this growth stage.

Spencer: Yeah, yeah. So were you surprised at how open other baking companies are to take you under their wing and help guide you in, “Here the things that worked for us, here’s equipment that works for us”? Because it’s something that is signature to the baking industry, that someone from the outside might not expect. Was that a surprise to you?

Abel: It really was a pleasant surprise of how generous people were with their time and advice. And it’s been so, so helpful. Without it, I would’ve made several other mistakes along the way. But you know, I always myself try to be as generous with mentorship and advice. I’m trying to always pay it forward with a lot of smaller bakers or startups will come to me and ask for advice or guidance. And I tried to provide it just as much as I’m getting it from these other, much larger companies, who have been so helpful and generous to me.

Spencer: There is so much camaraderie in the commercial baking community. I’ve talked to bakers who have toured other bakery operations in order to troubleshoot problems that they’re having, or get endorsements or feedback on potential equipment or lines that they’re looking to invest in. I’m so happy to hear that you’re experiencing that as well, because that’s one of the things that I love the most about this industry.

Abel: Yeah, it’s very comforting to have people who actually care to see other companies be successful. There’s enough room for all of us to be successful. And, you know, I’m glad that they see that, and I see that, and we all have to help each other.

Spencer: I mean, it really is the whole rising tide philosophy: a rising tide truly does float all boats.

Abel: Absolutely.

Spencer: Rebecca, that is all I have for our conversation about manufacturing. I love hearing about where you are with your operation right now, and I know that there’s more to come with what you’re doing there in Taylor, MI.

In a couple of weeks, we’re going to circle back and talk about that; I’m excited to get your take on having visited IBIE and seeing 1 million square feet of innovation. But before we get to that, next week, we’re going to talk about the thing that is on everyone’s mind: people development. So that’s what we’re going to dive into next, is how you’re developing your staff and what growth looks like from that perspective..

Abel: Sounds great. That’s definitely an important part of our company.

Spencer: All right, Rebecca. It was great talking to you and I will talk to you next week.

Abel: Sounds great. Thanks, Joanie!