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 first episode explores the early days of D’Vine and a young entrepreneur’s choice to manufacture cookies.
Learn more about this season here, and listen to Troubleshooting Innovation on Apple, Spotify, Google and Stitcher.
Joanie Spencer: Welcome to Troubleshooting Innovation. In this episode, we’re taking a look at the early days of D’Vine and a young entrepreneur’s choice to manufacture cookies. Hi, Rebecca, thanks for joining me.
Rebecca Abel: Thank you, Joanie.
Spencer: I am really excited for this season of Troubleshooting Innovation, because I’ve gotten to know you over the past few months. And I just love your story, and I think you’ve got a lot to share with the industry and sort of getting back to the roots for commercial cookie production. I guess the first thing that I want to talk to you about is just hearing the story of how D’Vine Cookies came to be. It’s really interesting to me, because you didn’t start out as a baker. Until D’Vine what were your areas of expertise? And what led you to baking?
Abel: Well, I’ve always been an entrepreneur, I can remember even as a child starting little businesses, and knowing that someday I wanted to create a really big business. Most of my career has been as a financial planner, money manager. And I continued to do that, and built a business around that. I grew that to a certain level that I am sustaining that and really wanted a new challenge. I’ve always loved eating desserts, but have never been a baker. About five years ago, I started seeing cookies really trending. I just had this deep knowing that cookies was something that I should pursue. I had tried some other business ventures along the way and some other foods, but cookies really resonated with me. And that kind of was the beginning of D’Vine.
Spencer: That is so awesome. At what point did that entrepreneurial bug bite? You said that you kind of looked at some other things and you got into food a little bit. What were some of those businesses that you considered? And how did you land on cookies?
Abel: About 10 years ago, I had an idea for a vegetable infused mac and cheese. I started doing R&D for that and creating a product and just wasn’t feeling that strong intuition that this is the right thing to move forward. I dabble in a lot of different ideas in my head and try to put something together. But with cookies, I was in New York City and saw a huge line down the block for a well-known bakery that I was standing in the line of. During that time, I just had this feeling that you know what, MI (where I’m from and live) needs something like this. So I started more on the retail route thinking, we need a store like this, we don’t have something like this in our area. That put the idea in my head and then I would start dismissing it because again, I’m not a baker. I didn’t even have a cookie sheet to be honest. I am not the mom that bakes cookies, but I love eating cookies. I knew that cookies were accessible enough that I could quickly learn and study different recipes to learn how to bake. I’m a fast learner, and I love learning and challenging myself. The idea for cookies really came from standing in a line for what I thought was a really amazing cookie. And I thought to myself, what if I took this cookie and made it into 40 different flavors and stuffed it and topped it and did all sorts of wacky things with it. I think that this could be an offshoot of a good cookie.
Spencer: I love this because most bakers that I talk you, had this passion and this love for baking, that they turned into a business. You have a passion and a love for business that you turned into baking.
Abel: Definitely, I’ve always loved business. I knew as a child, I wanted to create a big company, I just didn’t know what. I have started a lot of little companies and ventures along the way and have my other businesses as well still. But, my passion was for entrepreneurship and I have a passion for eating the desserts. It surprised everyone I knew when I told them that I was going to create a national cookie company. It was almost humorous to some of my friends and family.
Spencer: Okay, I want to sort of walk through the startup because I think this is just incredibly fascinating. Starting a business, you have to have the business plan in place, you have to know what the product is that you’re going to sell, you’ve to secure that financing. How did all of these pieces come together? How did you come up with the concept for the product? What sort of research did you do to try to figure out what that cookie was going to be? And how many flavors you were going to have? How did the entrepreneurialism and your business and finance mindset, how did they come together to create a product that you had no experience making?
Abel: It was September of 2017 and this really strong intuition came over me that cookies was going to be my next thing. A month before I had been in New York, like I said, stood in this line for a really good cookie. It was this fall day that I just had this gut feeling. I literally went to the store that afternoon, printed about ten different chocolate chip cookie recipes, and just started baking. And thought to myself, let me see what I can come up with. There wasn’t this well thought out plan before I started this initial R&D. I thought, let me see if I can come up with some really good cookies in this of style of tons of chocolate and really thick cookie. I knew once I had a base down, I was going to expand it. In my head, I needed to come up with a concept. Then I was going to put it on steroids with making all these different luxurious flavors. I like over the top indulgent desserts. From there, I spent about two weeks coming up with recipes and let things happen organically. I wasn’t sure what my plan was going to be. Obviously, I had to have a product to start with. I made a bunch of cookies, about ten different options, and then sampled them with friends and family. I had my personal favorite. Some people are wine connoisseurs and have a talent for really spotting great wines. For me, it’s with desserts. I knew, when I landed on my recipe, and I used multiple recipes and combined elements. So it was my own recipe I just had to learn about how this ingredient affected that ingredient, different types of flour and sample a bunch of different types of chocolates. I came up with my recipe, and then started coming up with different combinations. I ordered literally every type of chocolate on the market. Whether it was white chocolate or caramel, everything that you could possibly put in a cookie. And then just started coming up with different combinations and made about five different products. After I had my cookie makeup, I decided I was gonna launch really small. I was going to build a Shopify website and it on Facebook for friends and family. And just start small to see if anybody would buy these cookies. I didn’t start with the storefront or anything like that. Now in November of 2017, I was building my Shopify website. I had about five different flavors that I had created with a really over the top, decadent variations of that chocolate chip cookie, and just launched it to put it out there. I hadn’t spent much money, but I figured I had to prove the concept and see if people liked this cookie that I liked. Things took off instantly. I was going into December, gift giving season, recieved some business from different gifting needs that month. It was a great start. Obviously, there was a lot more that went into it, I had to find a production spot. I rented some space in a church kitchen, and I put an ad on Nextdoor in my neighborhood. I found four different women that wanted to come in and do some baking. I kept it really simple initially, didn’t overthink it and just launched and figured, “Okay, let’s just see how this goes!”
Spencer: Was that by design? Starting that small, and really taking those baby steps with making it for friends and family, and starting a website, putting it on Facebook, then going to running a kitchen, taking it to Nextdoor and getting a couple of people who wanted to help you out in their spare time. Was that by design from your business background? Or were you truly like, “Let’s just try this. All right, this is going well, let’s take it to the next level.” Did it happen organically or did you plan it this way?
Abel: I planned that I didn’t want to invest in something until I had proven my concept. I wasn’t going to build out a whole storefront and put a lot of money into this, until I could see that this was something somebody would pay money for. This decadent, really good cookie could least establish that people liked what I thought they would like. Obviously, my plan was never to have a small operation and just be working in a Church kitchen and making a couple 1000 cookies. The goal was to be something massive. But it was very intentional to start small, and at least put something out there. Then once I had the product that I knew people liked, I had a number of ideas in the background of how I would sell and market it. But I like I said, I didn’t want to start by spending a lot of money in this big build out. Especially not having ever been in a food business. One of my mottos to myself has always been to keep things simple. I’m keeping things simple in the case where I am just testing things out. It was more research that first quarter.
Spencer: Okay, I want to talk about that research. Because I’m imagining that you had to do a ton of research, not only in how to make the cookies. But also in what the market need was, and in putting together the business. Can you talk about what research you did to understand the consumer demand for cookies in Michigan? And then you said you had a plan to be a “national company” did you look at the market demand nationally, or what was your homework like?
Abel: I did do a lot of research. I did research on luxury cookies. At the time, there were a lot of cookies, and there’s always been a lot of cookies out there that are good cookies. But I didn’t see anything in the luxury category that was at the level that I wanted to be. I did a lot of internet research. I did research in terms of retail, because I wasn’t sure if I was going to be a retail brand or an online brand, I didn’t know what I was going to be. But I didn’t see a lot of competition in that overall luxury cookie space. That was the basis of what I was trying to create, was a cookie that was beautifully packaged, really intricate and very over the top and luxurious. The research definitely went a long way telling me I have something that there’s not a lot of other competition. That was where it started. I figured that let me at least create a product in that category. When I initially launched that first season, each cookie was wrapped in an individual ribbon. It was very over the top, and trying to be as luxury as I could make it.
Spencer: I can think of two brands that are really doing the luxury cookie well. But I think you’re right, it’s something relatively new in the US market to go over the top with cookies that are truly an experience.
Abel: I know some of these other companies now but at the time, this was 2017. One of them at least didn’t exist at the time. To me there were the long standing really large companies. But there wasn’t that front runner in the luxury industry. There wasn’t the Godiva chocolate of the cookie at the time.
Spencer: Yeah. We’re gonna sort of get into the whole journey and where you are now. But just reflecting on how you got started, are there things that when you look back you would do it exactly the same way? Are there things when you started the company that you would do differently now that you have a bit of hindsight.
Abel: Definitely things that I would keep the same and a lot that I would change. I went through an extreme learning curve. We literally started with measuring cups, because I didn’t know how production baking worked. So that first holiday season, we were making batches that were 20 cookies, with small mixers. Again, I didn’t want to invest in massive equipment, but I could have saved myself a lot of labour time that first season by just investing in a 20-qt. mixer right away. And realizing people use scales to measure ingredients. It was just part of my journey and it’s funny looking back into how I started. The other day I was looking at some of my original recipes and they had two cups of sugar and one cup of butter. Whereas now we’re at 45 pounds of this and much larger batches. But again, it provides comic relief for me looking at where I started and where we are now. It’s fun to look at. I like that I started small and didn’t invest right away in anything major until I could see that this could be a sustainable business. I think I’ve done okay. It’s mostly things that I feel good about the decisions I’ve made.
Spencer: Would you say that the business background you have, and having experience in business made you a little bit more fiscally conservative? So that you did exercise a lot of caution, as you started and really took those baby steps to, the thought process of “I’m not going to invest a lot of money until I really know how to bake?”
Abel: It was more that I understood the finance side of businesses, which was so important to me. You can have the very best product in the world, but if you don’t understand the numbers of it, what your costs are and lots of different pieces of the financial side, it’s going to be very tough go. Unless you know how to do that yourself, or you want to put a lot of money into somebody that can do that for you. I think that most of my decisions were business based. And obviously there was this dream behind it to build something really big. But to me, it was figuring out, let me launch a product. Then once it was launched, I was going to figure out what my marketing plan was. In the background, while I was working in this Church kitchen, I was looking into buying food trucks. I was looking into how to stand out on the internet. There was a lot going on in the background as well.
Spencer: You mentioned the storefront and considering retail truck. That is one of the questions that I have on the list. You and I have talked about this before. I will just never forget what you said. Because a lot of people don’t choose to go into manufacturing, especially women. Usually we sort of fall into it or experience it or discover that manufacturing and engineering is something that we were designed for. You made that conscious choice, to go the online route or the storefront route, or the food truck route. Why did you and how did you land on on manufacturing for your cookies, why not start out in a retail shop or on a food truck?
Abel: Well, I actually started out doing a little bit of everything. I was manufacturing, but on a really small scale. It wasn’t profitable in the beginning because I didn’t have the automated equipment. I knew in my head that once I proved the concept, that was one option to be a wholesaler to get things really systematic and manufacture and not go the retail route at all. But I did buy a food truck, I did have a small retail storefront, I did online and I started in wholesale. Once I proved my concept, I figured let me try all of these avenues and see what fits me best. I slowly crossed out online, I didn’t want to compete in that space. I’m not a social media person, and that’s really what it takes there. The food truck, I still do have two retail food trucks that do quite well. And we book a lot of events. But I could quickly see that my personality and where I wanted to go to scale really large, it was going to fit me best to do something that was very systematic and scientific. That came to the forefront, but I knew that was a few years away, because that I could see involved buying spending a lot of money on equipment. I still wasn’t ready after six months to go and invest, several hundreds of thousands of dollars in automated equipment to be able to really play in that space. It wasn’t that I just started right in manufacturing, I wanted to get there. But I needed to establish myself to be large enough to be able to go out and get the financing for that route.
Spencer: What did that process look like? At what point did you say to yourself, “This is going to be bigger than the food truck. It’s going to be bigger than just in my neighborhood and in my area. I can take this places and I’m going to have to start planning for investment in equipment.”? How did that sort of play out in your mind and in your business?
Abel: My first year, I bought the food truck. I put it out there and marketed it a bit. Things were going well and I had a small retail storefront in a an artisan market and the cookies were selling well. Everything I knew about financing, it’s much harder to come with just a concept versus coming with actual sales and revenue. I had to build up and try to sell as much as I could, in that small space with my food truck in the retail market and some online sales. That was what I focused on the first year, really hustling and trying to sell as much as possible. I started bringing on some wholesale accounts at local grocery stores. Although, I knew in the wholesale space, unless you’re manufacturing, it’s really not profitable. You can’t be making things by hand, at least not in the cookie world. It’s very difficult to be doing everything by hand and making enough money to be able to afford all the distribution and making sure the store can make their margin, everything is expensive. My plan was, after about a year, to start looking at what financing was available after I could show some revenue. That’s what I did. I went to a community organization after I had a year of decent numbers basically broke even my first year didn’t make or lose money, but I had decent sales. Then I went and started going for some financing to take the next step, and secured a loan. That loan actually was something that I used to build out a bigger retail space. After one year, I didn’t go right into manufacturing. I went and built out a decent sized retail space and needed to increase my sales because the loan that I got wasn’t enough to go out and buy the big equipment at that point. Then from there, I did a year in retail and started getting noticed. I was approached by a few companies that wanted me to private label products for them. So they had my cookies and it came organically that I was approached, I didn’t put myself out there. In my head, even though I wasn’t going this manufacturing route right away, I knew that if I build something really good, I would get noticed for the bigger opportunity. After a year still getting my feet wet in my mind of “What are my flavors? What is my true core product? What are my flavors?” So yes, I got noticed. A growing Franchise Group approached me and asked if I would make products for them. Of course, at that point, I was excited, this is my start into manufacturing. Once I had that first contract, and then quickly after secured a really large second contract, then I went to the bank and secured a much bigger loan and started buying the big equipment.
Spencer: Wow. And then you started buying that big equipment. And you were picking up some good contracts. What did that customer base shift look like? As you went from a storefront into manufacturing? How did the scale sort of shift?
Abel: This was now the very beginning of 2020. In that year, when I made that shift, I experienced ten times growth that year. It was the pandemic, and retail was very timely. Because the retail store that I spent all of 2019 really getting ready for launch and establishing were closed now for any business other than delivery business. In February of 2020 was when I got approached by the first private label client, and then in April, the much bigger client came to me and said, “Would you consider private label?” I liked the depth of your product line. To me this was exactly what was suppose to happen in my mind from switching into more of this manufacturing realm. I didn’t really even realize that private label was going to be the way that I was going to do it. I think that everything rolled out pretty organically.
Spencer: I’m over here, kind of giggling because, what you’re telling me is that in February of 2020, somebody came to you and said, “Something really bad’s about to happen, but I’m going to keep your business alive.” Here’s an opportunity that’s going to change the course of your business when retail shuts down.
Abel: Exactly, it was kind of magical, the way that it all played out. Because ten times growth in the year of the pandemic was something that was amazing for me. Looking back, it was pretty magical how it actually happened because most businesses didn’t have that type of growth that year. 2020 was the year this all fell into place for me. There’s obviously so many more details to what went on behind the scenes here. Here I am now with the store that I built out all of 2019 and, opened midway through 2019. In my head, that store was something I was considering franchising and there were a couple different business plans I was kind of playing with behind the scenes. These opportunities came in early 2020, that ended up completely solidifying my venture into manufacturing. That was definitely the way for me to go when everything was closed.
Spencer: Yeah, those pieces of the puzzle really came together in the midst of a bad storm. Alright, we’re going to do a deep into your journey through manufacturing and look to the future. By the end of this podcast season, we’re gonna really have a good grasp on where you’re heading into the future. But right now, I want to know, as far as your clientele, what’s your mix of contract manufacturing and branded products that you sell nationally? Where are you with that now?
Abel: Most of our businesses contract manufacturing. Now this is the first year I’ve really started selling and marketing my brand. Next year, there’ll be a lot of growth. So contracts that I’m securing this year, a lot of them will start next year, and be D’Vine branding. But up to this point, it’s predominantly contract manufacturing and private label business. That was the growth of my business. I wanted to build a big company, that was the goal. It wasn’t that I needed to have this. Yes, I wanted to have a brand, ultimately, but it was more about building something that was large. And I could see myself employing a lot of people and just wanting to build something much bigger than myself. That was a great place to start. It was in the contract manufacturing. But now I’m in the spot that I’m marketing and selling my own brand and have the know how of how to produce. All of my new business that I’m bringing on now, I’m no longer bringing on any more contract manufacturing, and I’m focused on my D’Vine brand now.
Spencer: But you’re keeping the current contracts that you have?
Abel: Yes, which have been great. And a really great way to establish and have cash flow to now focus on my brand.
Spencer: That’s amazing. We’re going to get into this in a couple of weeks. But how many employees do you hav now? You started not even knowing how to make cookies. How many people do you have working for you now?
Abel: We have about 22 right now. During the month of December, we’ll usually go up to 30-35. When we’re still making a lot of cookies that month. But our core team is is not huge. In production, we have about 14 different people. Then I have management staff, HR and basic foundation of people supporting me in administrative roles.
Spencer: All right. This story is just so fascinating to me. Rebecca, I think that you’ve done something really interesting. I think you’re growing a really incredible company. There are so many established commercial baking companies, we’re such a mature industry. It’s really great to hear the newness of an entrepreneur, getting started in a cookie manufacturing. And to bring the people who’ve been doing this for so long back to that feeling of what it was like to get into it in the first place. Thanks for sharing your story of how you got started today. This was really fascinating. I am so excited to spend the next few weeks with you as we talk about your philosophies behind your product development. And taking that deep dive into stepping into manufacturing and looking at how you’re developing your staff. Then ultimately talking about the strategic growth that you have for D’Vine Cookies. That’s an outline of where we’re going to go. I cannot wait to talk to you next week about product development.
Abel: I’m definitely happy to share my journey. It has been rewarding, and difficult but you know, but it’s something that I love. Thank you so much for having me on this podcast. It has been so fun for me to share where I’ve been and where we’re going.
Spencer: Awesome. Well, Rebecca, I will talk to you next week and we will hear about how you come up with your cookie varieties.
Abel: Sounds great!
