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