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Bakeries shun centralization
Despite the efficiencies that a centralized bakery operation can produce for a supermarket chain, many food retailers say the benefits of having in-store scratch bakeries still outweigh the potential cost savings.
December 31, 2014
4 Min Read
Mark Hamstra
Despite the efficiencies that a centralized bakery operation can produce for a supermarket chain, many food retailers say the benefits of having in-store scratch bakeries still outweigh the potential cost savings.
“We are set up to be a full line, in-store production bakery,” said Chris Arnold, assistant vice president of bakery operations at Hy-Vee, West Des Moines, Iowa. “This is where our roots are at, and we believe by committing to ongoing training, we have a competitive advantage. It allows us to be agile and react to ever changing market expectations.”
Keli Lessing, fresh bakery sales director at Harmons Grocery, Salt Lake City, said having in-store bakeries in all locations provides a selling point for customers.
“Our current process has the benefit of having a pastry chef at each location to communicate with customers, and to educate them,” she said.
Lessing and others contacted by SN said they have considered some degree of centralization, however, because of the efficiencies involved. Among the biggest challenges to operating in-store scratch bakeries are recruiting and training qualified personnel.
“Eventually, we would like to move some items to more centralized/shared bakery operations,” Lessing said. “The challenge of our [current] approach is training — making sure that each pastry chef knows how to make each item correctly all the time provides an opportunity.
“There is also the challenge of efficiencies. Having one location produce one item saves labor and reduces waste.”
Likewise, Arnold of Hy-Vee said centralized baking of some items “could be part of our future.”
“But our present focus is on the continual development of our entry level, mid-level and highly skilled personnel through ongoing training,” he said. “This approach allows for daily skill levels to grow and develop. Personnel remain engaged and excited about their jobs, which allows for creativity and higher productivity, as well as creating an environment that supports outstanding customer service.”
John Chickery, bakery program director at Riesbeck’s Food Markets, St. Clairsville, Ohio, which has in-store bakeries at most of its locations, said his company has considered a centralized production model.
“We’ve thought about it many times, and we’re just not ready to do that yet,” he said. “It’s a huge investment in equipment and the facility.
“The one thing that might make us do that is the labor factor. The labor force is shrinking, and it’s harder to find people. But we will train people, and teach them to be bakers.”
Increasing appeal
Fresh & Easy Neighborhood Market, which operates a format built around the efficiencies of centralized production for much of its product, a few years ago made the move to in-store baking to increase its appeal to customers.
“We reinvigorated all of our fresh foods with a particular focus on in-store bakery, because it really is an ideal place to showcase delicious, high-quality, fresh food,” said Brendan Wonnacott, a spokesman for the El Segundo, Calif.-based chain.
He said that the company, which installed ovens and added personnel in stores to finish par-baked product, has been focusing on finding unique items to showcase. These include a pretzel-croissant hybrid called a “Cretzel” and an imported Belgian waffle that has been used to create a chicken-and-waffle sandwich and a strawberries-and-crème waffle sandwich.
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“A lot of the focus has been on innovation and unique products, more so than rolling out traditional items,” Wonnacott said. “We are really mindful that customers are looking for a new option — something a little bit different, so that’s really been where the focus has been for us.”
Having an in-store bakery has also allowed the chain to focus on breakfast offerings, including croissants and bagels, to build traffic during that daypart as the chain has expanded its operating hours.
Wonnacott said Fresh & Easy has no current plans to implement scratch baking, however.
“We’ll see down the line some day,” he said. “It’s a constant evolution at Fresh & Easy.”
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