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Lou Albanese, CEO, TMF – The Meat Factory, Stoney Creek, Ont.
Infusing your baking with liquor is a perennial customer favourite.
BY LAURA AIKEN
DOWN TO BUSINESS
Iget excited about writing. I’ve been writing stories since I was about eight years old, but anything to do with numbers has always been a Kilimanjaro climb for my brain. Sometimes math is, I dare say, just repulsive. It seems when people are passionate about a craft, they often focus single-mindedly on honing that skill, sometimes to the detriment of well-rounded development. Although this obsession that likes perfection is no problem for bakers, it can be a problem for bakery owners. The Midas touch has no flour on its fingers. Keeping the doors of a bakery open depends just as much on your business acumen as your baking. A world champion baker can easily close those doors if he or she overlooks the basics of running a business.
I got to thinking about this dilemma after sitting down with Daniel Stubbe, whose family has been in the chocolate business since 1845 (story on page 14). Stubbe Chocolates has a deserved reputation for making wonderful premium treats, and in talking to Stubbe it became clear very quickly that he is an astute businessman.
A talented proprietor with little skill in running a business is a classic problem and a common occurrence. It’s possible to succeed and learn as you go because anything is possible and many do. However, you’ll be giving the bakery its best chance of a long life by ensuring your passion for making the product is equalled, if not surpassed, by an interest in business. There are a number of continuing education courses for entrepreneurs offered by schools, as well as a bevy of books on the shelves, and hopefully mentors available to help foster a business-oriented mentality. Business acumen helps balance the emotional investment of building a company with grounding in reality and good decision-making.
}Stubbe observed there were a lot of chocolate shops opening up, and remarked that he wished them all the best but wondered if they were all really prepared for the reality of keeping their costs covered 12 months a year. Statistics say some are and some are not, and instincts say many lie awake at night worrying less about truffles than about how to get more customers through the door.
The Midas touch has no flour on its fingers. Keeping the doors of a bakery open depends just as much on your business acumen as your baking.
It’s so easy to underestimate the scope of leading a company, and some of the surprises are part of the fun in the adventure. One of our goals at Bakers Journal is to help bakers prepare their businesses for the future. I thought I would take this opportunity to encourage newer business owners who don’t have the experience longevity affords, to reach out for formal assistance, be it through school, a business advisor or a book. Stubbe is right: There are a lot of bake shops opening up. But who will stay open? Bear in mind the case of Open Window Bakery, which closed its doors in Toronto after 54 years. There are no guarantees in business or in life (aside from death and taxes, of course). The best we can do is prepare and move ahead strategically. Math may feel like closing your fingers in the trunk of your car, and if it does, I empathize. But it is a painful and beneficial necessity with a close relative we are all fond of: Money. / BJ
OCTOBER 2011 | VOL. 71, NO. 8
EDITOR | Laura Aiken editor@bakersjournal.com 416-522-1595 1-888-599-2228 ext. 250
Occasionally, Bakers Journal will mail information on behalf of industry-related groups whose products and services we believe may be of interest to you. If you prefer not to receive this information, please contact our circulation department in any of the four ways listed above.
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AS A BRC CERTIFIED COMPANY, we pride ourselves on the highest industry quality standards. At Puratos Canada we want to be recognized as your preferred supplier, generating added value through top quality products and state of the art services. One of our core values is our passion for quality. We have a fundamental belief in the concept and delivery of quality in everything we do or produce. With strict implementation of all BRC standards our commitment to you is unhindered. This is a key factor in providing you excellence in Bakery, Patisserie and Chocolate in Canada and around the world. We thank you for your continued support.
briefly | Tim Hortons’ Canadian sales stall | Bran may extend product shelf life | The future of sweet treats is small | for more news in the baking world, check out our website, www.bakersjournal.com
GFTC announces speakers for State of the Industry event
BRAMPTON, ONT. – The Guelph Food Technology Centre (GFTC) has announced two of the speakers for its upcoming State of the Industry: A Closer Look at Canada’s Food & Beverage Industry symposium.
Andrew Bell is a Canadian investment reporter and host of two Business News Network programs – Commodities and Market Call. He will present “The Big Picture – An Overall Look at Canadian Food Retailing,” which will explain why inflation is a key driver for food retailer profitability and address the challenges faced by Canadian food stores. Bell will also present a scorecard of the three big
Canadian retailers over the past five years, highlighting efficiencies and what is being done to fight falling profits and flat sales.
Douglas Porter, deputy chief economist with BMO Capital Markets, will deliver a presentation entitled “Canada’s General Economic Status and Outlook.” He will discuss how Canada has withstood the recent global economic pressures and how the food industry will fare in the future, given the recent indicators of increased food prices.
The GFTC’s biennial State of the Industry symposium will be held Nov. 4 at the International Centre, in Brampton, Ont.
New tool to fight skilled labour shortage
OTTAWA – The federal government’s new Working in Canada website (www. workingincanada.gc.ca) allows employers to find, hire and retain workers by
SIAB scheduled for May 2013
VERONA, ITALY – The Italian federation of bakers, confectioners and related trades are partnering to bring the 10th International Bakery, Pastry, Confectionery, Pasta and Pizza Exhibition back in May 2013.
“The event dedicated to bakery, pastry, confectionery, pasta and pizza has an especially strong focus on internationalization,” said Giovanni Mantovani, CEO and director general of VeronaFiere. Objectives in bringing back SIAB include the “reunification” of the various fields.
Learn more at www.siabweb.com.
accessing labour market information and human resources tools, as well as government program and regulatory information.
Sara Lee sells North American refrigerated dough biz
DOWNERS GROVE, ILL. – Sara Lee is selling its North American Refrigerated Dough business to Ralcorp Frozen Bakery Products Inc.
“The sale of our North American Refrigerated Dough business to Ralcorp is another step forward for Sara Lee as we continue to prepare for our separation into two publicly traded companies,” said Marcel Smits, chief executive officer for Sara Lee Corp., in a news release. “It will better enable our North American business to focus on its branded meats and frozen desserts products and establish a platform for a strong and independent future.”
Sara Lee’s North American Refrigerated Dough business is a $545 million sale, expected to be done by the end of 2012.
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BAKING WITH LIQU
OR
Desserts for grown-ups are coming of age. Alcohol infused treats ranked fifth on The Food Channel’s list of this year’s top 10 dessert trends. The trend report pointed to milkshakes with rum, gelato with wine, and doughnuts with beer popping up on dessert menus everywhere, while restaurants offer liquor add-ons to their decadent chocolate creations.
“It’s a combination that’s been matched up for eons,” says Cornell Idu, master chocolatier with Rogers’ Chocolates in Vancouver. “The types of alcohols used might change, but not the idea or concept of chocolate and liqueurs or alcohols.”
Rogers’ Chocolates is certainly no stranger to the idea. The 126-year-old chocolate maker has partnered with British Columbia’s Ganton and Larsen Prospect winery to offer a delicious line of icewine truffles. In the past, the company also experimented with a line of chocolates highlighting Canadian spirits, pairing the country’s homegrown ryes, gins and whiskeys with Rogers’ signature chocolates.
}The key to crafting a mouthwatering chocolate concoctionlies in understanding the type of alcohol you’re working with, says Idu. The trick is to identify what the alcohol is distilled from and then supplement it with a similar flavour.
Incorporating a carrier for the alcohol is the best way to capture and preserve the flavour.
soaked raisin is sealed inside the chocolate, the flavour is locked in.
The other trick to preserving flavours is to properly temper the chocolate. Letting your chocolate hover just below the melting point for an extended period of time can help grow the crystals that will form a harder chocolate, sealing the alcohol and supplemental flavours inside.
“Alcohol is alcohol. It might have a mouth feel and a nose feel, but it doesn’t necessarily have a strong flavour, so you want to really accentuate that.”
“If you’re planning on using brandy, you might want to use a grape juice concentrate. With a whiskey, you’d use some malt to accentuate that background flavour,” Idu says. “Alcohol is alcohol. It might have a mouth feel and a nose feel, but it doesn’t necessarily have a strong flavour, so you want to really accentuate that.”
Incorporating a carrier for the alcohol into your creation is the best way to capture and preserve the rich flavours alcohols can add to chocolate. For example, to create a rum raisin truffle, marinate the raisin in rum before making the truffle. Once the rum-
Working with alcohol presents other challenges too. Alcohol can curdle cream, so chocolatiers have to take a stepped approach, much like a bartender does when assembling a cocktail. Creating an alcohol-carrier centre that can compete with the strong flavour profile of the chocolate is a must. Striking the right balance between the flavours and the consistency of the finished product is also essential. Idu suggests blending different types of chocolates to strike the right balances.
“Chocolate’s not necessarily set in white, milk and dark; you can blend chocolates to make your chocolate taste more subtle, or replace some of the chocolate with harder fats like cocoa butter, which has been deodorized, so it doesn’t have the same
flavour value as chocolate.”
Chocolate and alcohol are a tried and true combination, but there’s no shortage of new and exciting flavour combinations.
Bake like a bartender
Your local liquor store is stocked with ideas to spice up an existing product or inspire a completely new line. Each bottle represents a new flavour just waiting to be uncorked and reintroduced to consumers in exciting new ways.
“People are always looking for new ideas to try and new flavourings. This is just another way, instead of using chocolate or vanilla or savoury spices,” says Krystina Castella, who co-authored Booze Cakes: Confections Spiked with Spirits, Wine and Beer (Quirk Books) with Terry Lee Stone.
Booze Cakes is exactly what it sounds like: a collection of recipes that call to mind lazy days sipping umbrella drinks on tropical beaches and happy hours at trendy bars. The book features classic recipes for honey spice beer cake and bourbon-filled lane cake with bourbon buttercream, as well as cocktail cakes like the rum-and-Coke whoopie pie, wine tasting cake shots, and unique creations like the Jagermeister German chocolate cake. As the title suggests, the focus of Booze Cakes is making the most of the unique flavours of the alcohols.
“When you have a book titled Booze Cakes, you have to make sure that everything has that boozy flavour in it,” Castella says with a laugh.
The key to crafting these cakes is to find common elements between a cake and a drink, then identify ways to incorporate aspects of the drink into the cake. For example, a coconut cake and a piña colada share similar flavour profiles, which gives a baker a good starting point to work from.
“We took the elements of both the cake and the drink and we rethought how they could be and how the’y could work together. We have coconut milk in a piña colada recipe, so what if we add coconut milk into a coconut cake instead of just desiccated coconut?” says Castella.
Baking a cake with the complex flavour profile of a familiar cocktail requires finding the balance between the cake and the cocktail ingredients. Different cocktail cakes have varieties of alcohol, each with
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a different strength and burn-off rate during baking. Keeping those flavours in balance can be a challenge.
“If you’re having a drink you don’t have to worry about it, but if you’re making a cocktail cake, how do you get that same balance of flavours that you would have in a mixed drink?” Castella says. Striking that balance with their Long Island iced tea cake – made with gin, light rum, tequila, vodka and ’triple sec – took s’ix or seven tries, versus the average of two to four attempts most of the other cakes required.
But there’s more to it than simply balancing the various alcohols in a dessert. All the other ingredients must be kept in balance as well. “If you add something that’s super sweet, like Kahlua or a coffee liqueur, then you have to balance the amount of sugar,” Castella says. “So you cut down on the sugar, but then once you cut down on the sugar, which usually gets bl’ended with the butter, how does the amount of sugar you add rework the relationship with the butter? How does that affect the relationship with the flour?”’
Castella says the easiest way to keep all your ingredients in balance is to focus on incorporating alcohols into sauces and icings, or soaking the cake in an alcohol bath after baking, rather than incorporating the alcohol into the actual cake batter.
Of course, the possibilities certainly aren’t limited to cakes. “Cookies are easier because cookies are denser than cakes . . . . Cookies have a lot of density that you can play with. It’s a lot less risky in terms of having to rise. If you’re making a pie like a strawberry or a blueberry pie that has a lot of syrup in it, those work really well because you already have the liquid aspect to it,” Castella says.
Innovations for a better world.
Regardless of what you’re mixing up, keep one other trend in mind: The Food Channel cites “sipping seasonally and simply” as its numb’er five pick in this’ year’s top 10 beverage trends. This trend is just as important for bakers as it is for bartenders. “In the summertime, you have a lot more cocktail-oriented flavours and fruity flavours versus when you get into the fall and Christmastime, when you have a lot of the heavier alcohols like rum and brandy,” Castella says.
As your business gears up for the holiday season, why not explore ways to reflect this hot trend in your baking? / BJ
By M AR io Fo
CAkE MAgiC
Controlling the many factors in the art of baking is the trick to making perfect cakes every time
Missing volume in your cake? There are many causes that can lea’d to a lack of volume in cakes, and many depend on the type of cake being prepared. Here are the definitions of the various types of cakes (the flavour doesn’t matter):
• Cream cake made with shortening or rich in oil, mixed with a paddle in three stages;
• Sponge, Genoese or angel food cake made without fat or with an emulsifier, mixed with the whip in one or two stages;
}• Pound cake rich in eggs and butter, mixed in three stages. This cake is very heavy, has less volume, and features a dense and compact crumb, which gives it a long shelf life. This is the type of cake batter used for fruitcakes; and
• Too much vapour in the oven. Another common problem is cakes falling during baking. Common causes include:
• Too much leavening agent, causing the cake to collapse in the centre;
• Too much air incorporated during mixing or too much ’emulsifier (see specific gravity calculation);
• Poor quality of egg solids;
• Flour that is too weak;
• Abrupt movements during baking, which may cause the rack or tablet to vibrate;
• Oven temperature too low during baking (see sideba’r).
Cakes may also shrink during baking due to:
• Too much leavening agent in the batter;
• Too much water or liquid in the batter;
• Flour that is too strong;
The ph influences the optimal volume, the grain and the texture of a cake. A higher ph will give more volume but it will also result in an open crumb. A lower ph will reduce volume and produce a fine crumb.
• Batter that is too cold or an oven heated to too high a temperature (see sidebar).
• Cheesecake made with cream or cottage cheese. Lack of volume is not a concern with this type of cake. There are 10 major issues that can lead to a lack of volume in your cakes. They are:
• Poorly formulated recipe or inaccurate conversions;
• Inadequate mixing;
• Batter that is too thick, with an insufficient quantity of water;
• Temperature of the batter too cold or too warm (see sidebar);
• Eggs that are too old eggs, or a lack of egg solids;
• Insufficient baking powder in the batter, or using the wrong type of leavening agent in the batter;
• Too much rest time between mixing and baking;’
• Not enough batter for the size of the cake pan;
• Oven temperature too high during baking (see sideba’r);
The best way to guarantee a quality cake with an accurate volume is to consider the followi’ng criteria:
• Final batter temperature (see sidebar);
• The specific gravity of the cake batter. The specific gravity is the
measure of air incorporated into cake batter during mixing. The incorporated air determines the texture, final volume and symmetry of the cake. The specific gravity is obtained by dividing the weight of the batter by volume into the weight of the same volume of water. The specific gravity is not a weight but a fraction relative to the same volume of water, which has a value of 1.00 (see sidebar).
Specific gravity = weight of a volume of cake batter weight of an equal volume of water
• The pH of the batter. The pH influences the optimal volume, the grain and the texture of a cake. A higher pH will give more volume but it will also result in an open crumb. A lower pH will reduce volume and produce a fine crumb (see sidebar).
• Baking temperature. The temperature of baking is variable according to the type of oven, which is different for every bakery. Baking temperature in a convection oven will be 30 C (50 F) less than in other types of ovens. / BJ
Mario Fortin is an international bakery consultant and owner of FORMA-LAB, a consulting service for bakers and suppliers. If you have a technical problem, send your questions to info@forma-lab.com.
Baking temperatures are calculated for a standard oven without convection.
¦ concepts for success ¦
By Di ANE Chi ASS o N
8 ECoNoMiCAL iDEAS To uPDATE youR iNTERioR
Feeling drab? Here are eight great ways to spruce up your space without breaking the bank
Is your bakery looking a bit old and stale? Are you thinking about making some interi’or design changes, but afraid you can’t afford it? There are several ways you can update and refresh your operation without having to hire a professional designer or do a complete renovation. Sometimes, just a few simple ideas can help turn your place into something new.
fREshEn uP wITh PaInT
Nothing brightens or freshens up a room better than a new coat of paint. Painting is the easiest and ’most inexpensive way to make an instant change to the inter’ior design of your operation. It’s also a good excuse for you to clean and freshen up the walls. Choose a colour that works well with your brand, but is still trendy and modern. Don’t just stick to the walls. Repaint your chairs, counters, tables –anything that is looking a bit old, dirty or faded.
hang wallPaPER
}PaInT ThE flOORs
If you need new flooring, but can’t afford hardwood, consider removing your existing flooring (whether it’s carpet, laminate or tile) to expose the concrete, then painting it. You can be creative with the colours, patterns and designs. You can even paint your brand logo on the floor. Alternatively, you can find lots of inexpensive laminate tiles that look like hardwood but cost a lot less.
gET nEw faBRIC
Instead of buying new chairs and banquettes, consider reupholstering your existing furniture. Look for fabrics that are durable and easy to clean. Fabric stores often have blowout sales on last year’s styles. If you want your bakery to be more eclectic, consider using fabric from the scrap bin. Many designer fabric
Place mirrors around your bakery counter to multiply the images of your fresh breads, cookies, cakes and pastries, and make things appear more plentiful.
stores have remnants that you can buy to use on your chairs, lampshades, or anything else that needs a little sprucing up. If you have dining chairs with only the seats upholstered, you can even do the job yourself – just pop the seat out, stretch the new fabric over the seat and staple it into place.
Nothing freshens up a room better than a new coat of paint.
found in your own kitchen such as glass jars, tins, boxes, old baking equipment and utensils.
wORk wITh aRTIsTs
On COnsIgnMEnT
If you want wood walls in your bakery, but can’t afford it, why not hang wallpaper that looks like wood? The variety of wallpaper available today makes it possible for you to achieve practically any look you want for a fraction of the price. Consider using wallpaper with different textures to add to the visual depth of your operation.
usE MIRRORs
Mirrors are a great way to create extra light, space and accents. Framed mirrors can create mock windows as well. Place mirrors around your bakery counter to multiply the images of your fresh breads, cookies, cakes and pastries, and make things appear more plentiful.
lOOk fOR sECOnD-hanD OPTIOns
Scour garage sales and flea markets, restaurant auctions, or websites like eBay, Craigslist and Kijiji to find stuff for cheap. Buying second-hand products is essential to interi’or designing on a ’ budget. Look for d’etail pieces and th’ink outside the box. For example, you could use an old iron gate as a storage rack for pots or an old ladder (with a fresh coat of paint) as a stand.’
BE CREaTIVE wITh PROPs
Dress up your bakery by picking up glass vases at the dollar store, and filling the jars with stones, marbles, rocks or sand, and a candle. You can also create visual merchandising displays by using items
There are a lot of starving artists out there today who would love the opportunity to display their artwork to the public. Work on consignment with the artist whereby you agree to hang the artwork in your bakery, and if you sell a piece, you get to keep a percentage of the sales. This is a win-win situation: you get original artwork to improve the interior design of your space while the artist gets the opportunity to gain some exposure. A little creativity will go a long way in helping your bakery put its best face forward. / BJ
Diane Chiasson, FCSI, president of Chiasson Consultants Inc., has been helping restaurant, foodservice, hospitality and retail operators increase sales for over 25 years. Her company provides innovative and revenue-increasing foodservice and retail merchandising programs, interior design, branding, menu engineering, marketing and promotional campaigns, and much more. Contact her at 416-9261338, toll-free at 1-888-926-6655 or chiasson@chiassonconsultants.com, or visit www.chiassonconsultants.com.
Chatting with Daniel Stu BB e
Stubbe Chocolates was born May 9, 1845, in Germany by the hand of Johann Heinrich Petrus Stubbe. Nearly a century and a half later, Heinrich Josef Stubbe moved the company to Canada. The family runs two successful locations, one in Ottawa and one in Toronto, where his son Daniel is at the helm.
Bakers Journal sat down with Daniel in his Dundas Street shop, where he goes through about four tons of chocolate a year and produces 2,500 truffles a day in December. It’s airy and artful with plenty of mirrors and an open kitchen where customers can watch chocolates being made. In the back he has a separate room for hosting workshops, which he does all year except for summer. Here’s what Daniel had to say about the chocolate business of today and tomorrow. what flavours are selling well at the moment?
When it comes to flavours there are two different types of customers. The traditional customer that really wants flavour combinations like Grand Marnier or champagne, something that they’re familiar with and that they’ll always come back to. And then there’s another group of customers who are, dare I say, new to chocolate? And they go for the more crazy flavours, the chilies and the balsamic vinegars and they are actually quite distinct groups. Can you spot them coming through the door?
actually feasible? A lot of times we come around and go ‘oh, this might work for
}As people get more educated on food in general they search out the finer things, they buy the $30 olive oils and spend more on chocolate as well.
us,’ others don’t, and so on. what’s the craziest thing anyone’s ever come in and asked for?
out to restaurants, so that translates into the chocolate and we ended up with a curry truffle. So that’s how it comes about. so you don’t shoot to introduce things at certain points in time?
Yeah, you can tell what people want. With the younger crowd, or more of the foodie crowd, you can kind of spot them in the way they check out the store. And it’s interesting . . . chocolate is just so big. We have customers coming in asking for crazy flavours that we’ve never heard about and we actually have to go out and research them, and say, hey is this
What we’ve been working on for a while and we definitely have to come up with is a bacon chocolate. There are some colleagues of mine that do them and I’ve tried them and it’s a really good combo, it actually works – in conjunction with milk chocolate. I don’t know if it would work so well with dark, the ones I’ve had that I’ve liked, they’ve all been in milk chocolate. how often do you introduce new things?
Al lot of it has to do with my own personal tastes and what I enjoy at the moment. A while back I was really into Indian cooking for a while, at home and going
I don’t set myself deadlines to have five new flavours by a certain time or so on, that’s just not how I work. Because then you end up forcing yourself, and especially when you work with more savoury flavours, it can really backfire . . . . Most notably, I have yet to taste a cheese chocolate that I like. There are a lot of cheese chocolates around; I just don’t think it should be done. Just because you can make it, doesn’t mean you should. It just doesn’t work. what do you think is the most important element that takes a truffle, or any chocolate for that matter, from great to outstanding? Taste-wise, I think a lot of it comes down to balance. When I think of cheap chocolate, a lot of times they are so rich and so filling and you can’t eat a lot of them because there is so much sugar, and you shouldn’t have that in a premium
Third-generation chocolatier Daniel Stubbe runs the family’s Toronto shop.
truffle. I think I pride myself in knowing that you can actually eat several of my truffles one after another. Chocolate shouldn’t be too sweet; nonetheless, obviously white chocolate is sweeter than dark, but it has to be the right sweetness. You can have a fairly sweet chocolate that is still good by virtue by how it’s made.
You can also say it boils down to really basic things. In chocolate, the most expensive ingredient is the cocoa butter, so a cheaper chocolate consequently has less cocoa butter in it. The cocoa butter is responsible for the viscosity of the chocolate, so when you have a chocolate with less cocoa butter or cocoa butter replacement, like hydrogenated oils and so on, it will not melt as smoothly in your mouth and it will leave a coating and that’s what you get with cheap chocolate. Premium chocolate has a high cocoa butter content and it just really melts very nicely, doesn’t leave a film in your mouth, doesn’t leave an aftertaste and so on.
as you say, chocolate is big right now. how do you see the business of being a chocolatier evolving?
One thing is why it’s so big. As people get more educated on food in general they search out the finer things, they buy the $30 olive oils and spend more on chocolate as well. So I think that trend is here to stay. There is no reversing for that. What I think will happen is that the trend towards exotic flavours will slow down. I think that it will come back to the basics. It will be for the simple reason that the customer that buys these exotic flavours is always out for something new and you can only maintain that for so long.
How we are in our relationship to chocolate, all the way down to where the cocoa beans come from, is getting stronger. We have several origin chocolates where we know the bean is only from a certain country. We have two chocolates where we know what plantation they are from. That will be happening a lot more and that’s how it should be. That will get stronger and stronger, and of course, organic chocolate is getting bigger as well. have your recently seen any new techniques for working with chocolate that you’re excited about?
In the last 10 years, there has been an explosion in techniques. We put chocolate in spray guns and use them as paint, or we use untempered chocolate and temper it on a frozen marble slab or use transfer sheets to get images onto the chocolates and so on. What we see is that us chocolatiers are going and combining all these techniques into our truffles and chocolates. Having said that, maybe in the last two or three years there wasn’t really that much new in techniques. What we learn more about and keep learning more about is how chocolate actually works. The science behind it. where do you see people struggle in the chocolate business?
What we see right now is there are a lot of new shops opening up... and there are a lot of people going into it. It’s fun, it’s a growing market, in that sense I wish everybody the best to do that, especially in a place like Toronto, where there’s such a big market. But really do your research and make sure you get a lot of experience. You have to work in a chocolate shop. It’s not enough to just take a couple of courses and open up a chocolate shop. One aspect is our business is such a seasonal business. So when it comes to the business aspect, you have to think about how you’re going to cover your costs in the summertime when nobody buys chocolates. You might want to get some experience making ice cream, that could be one way, or maybe you go into the wedding market, but just do your research if you want to join us. / BJ
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Surviving flu S eaS on
As the last remnants of summer are carried away in the brisk autumn breeze, another season is l’ying dormant, waiting to rear its ugly head. Its name is flu season and the coughing, sneezing, fevers and aching muscles will undoubtedly roll through your community, attacking without prejudice and wreaking havoc on people’s daily routines.
Health Canada reports that the flu season in our country typically runs from November to April. An estimated 10 to 25 per cent of Canadias may get the flu each year. In recent years, the stakes have increased with potentially fatal viruses spreading around the globe. In 2009 the World Health Organization declared the H1N1 influenza virus a pandemic and in 2002 and 2003, Severe Acute Respiratory Syndrome (SARS) was declared a “near-pandemic.” The possibility of contracting viruses with severe side-effects are greater than ever. Although these illnesses are of grave concern for individ’uals, business owners should also be concerned and prepared to act if a flu virus spreads through their store, incapacitating employees and managers alike. The flu is spread through droplets in the air left by an infected person’s sneeze or cough as well as what is on his or her hands that they then touch. Back-up strategies to deal with ill staff and prevent lost income are key.
}The best strategy for protecting your business from flu season is to prevent an outbreak in your store altogether.
Johnston notes that owners must go back to basics to achieve this by keeping their staff healthy through basic food safety practices and not overworking them.
“Hand washing, hand washing, hand washing. If you use hand sanitizers, it cuts your illnesses significantly. Good food safety practice to prevent cross-contamination is important. There’s also that business risk of having a sick employee making a customer sick. If staff members come in and they’re sneezing all over the place, send them home! Get them out of your restaurant before they infect everybody. When you’re the manager and you’re sick, it’s no different,” he warns.
Kyla Eaglesham, owner of Madel eines, Cherry Pie & Ice Cream in Toronto, agrees with Johnston’s emphasis
Even with strong food safety practices in place, a virus is bound to make its way into your bakery sooner or later.
“Make sure that you keep the integrity of your place and don’t lose your head, don’t panic. it’s just part of business and it’s part of life. People get sick.”
on food safety and adds a few more suggestions.
Hugh Johnston, of Hugh Johnston Strategy in Toronto, has been in the foodservice industry for the past 15 years. He says owners can see a loss of income when their best staff members are off due to illness. “What you need in this business is your aces in their places. You need your best people on when you make money. When your best people are sick, you’re not making much money.”
“Sanitization is number 1. If you have a clean workspace then naturally you’re putting your staff and your customers at lower risk. Number 2 is wearing a proper uniform. When I went to cooking school we were taught that the uniform is designed to protect you inasmuch as it’s designed to identify you. Also, eating right and exercising. Those are universal and would be the four big pillars,” she says.
Eaglesham encourages her staff to get involved in physical activity as a way of staying healthy and happy. “It’s fun and it puts you in a better mood. I encourage people to let me know if they have a class that they’ve signed up for, so that I can
schedule them around it.”
While preventing flu bugs from entering your busy bakery is the ultimate goal, sooner or later a virus is bound to weasel its way through the front doors. If you find yourself taking calls from bedridden staff members who can’t make their shift, it’s imperative to have reserve staff in place who are willing to jump into action at a moment’s notice, preventing what could otherwise be a disastrous day.
“When you’re short-staffed, your customers get bad service. When your customers get bad service, they reward you by not coming again,” Johnston advises.
Without a reserve staff, Johnston warns that you are bound to make two common errors. “The first mistake is that your management and your managers jump in and when they jump in, they are
now doing the day-to-day work, they’re doing hourly work and they are not managing. That can be a big mistake. The second mistake that can happen is that you overwork the people that you do have and that can cause them to get run down and ill as well.”
By having a flexible staff in place, business owners can avoid these above missteps, keeping their managers on task and their healthy staff healthy. Reserve staff is usually made up of part-time, flexible employees, but can also include college students from local baking schools and even friends from neighbouring bakeries who can help each other out. This is something that Eaglesham has experienced first-hand.
“The one thing that I found when I opened my business here in Toronto is that there’s incredible camaraderie in the industry amongst women. I’m being a little narrow when I say amongst women because I’m sure it goes beyond that, but I just happen to have a great circle of women who, if someone called me to help, I would be there and vice versa. So I’ve never had to turn away customers because we were short-staffed.”
Eaglesham highly recommends calling your local college or baking school as well when you’re in need of an extra pair of hands.
“The local college is such a great resource. When I was a college student, I did all kinds of vol’unteer and paid positions that were short term. It’s easy to forget about them because sometimes people think they are inexperienced or they’re going to waste materials, but if you bring them in to do a specific task, like for example decorating 3,000 cupcakes, chances are they can pipe rosettes if you show them once. Sometimes just an extra hand to clean up is good and they’re learning because they’re seeing a business in action.”
Another strategy that will boost your staff’s abilities and help you when your pie-maker calls in sick is to actively crosstrain your employees. Johnston warns that if you rely solely on one employee for a specific task, you are putting your business at unnecessary risk if that employee is home ill. “You’ve got to go out and actively hire people and develop people who are really flexible and who will jump in and cross-train,” he advises.
Eaglesham agrees, noting that reliable, skilled staff are key to achieving and maintaining customer service, especially
during hard times. “Make sure the staff you hire are the kind of people who really step up to the plate. We all cover each other’s backs, we all know that there’s a day that may be longer than another day, but if something’s wrong or if somebody’s sick then we cover each other, because the customer experience is why we’re all here. When you love what you do you can make good decisions,” she says.
If you do find yourself faced with a rampant flu virus causing dire staff
shortages, be sure to use the strategies outlined above. People in all most industries and walks of life, including likely you, have felt internal or external pressure to work even though they are contagious and they should really be at home, so it’s good to remember this last piece of advice from Johnston: “Make sure that you keep the integrity of your place and don’t lose your head, don’t panic. It’s just part of business and it’s part of life. People get sick.” / BJ
October
BAC Expressing Concerns Regarding Transition in CWB Mandate
BAC has communicated with the federal government regarding growing industry concerns with the continuance of normal business risk mitigation practices such as forward contracting during the transition in changes to the Canadian Wheat Board (CWB). Following the May 2 federal election, Agriculture and Agri-Food Minister Ritz announced it was the government’s intention to introduce legislation this fall to end the Canadian Wheat Board’s monopoly on marketing western wheat and barley effective August 2012.
BAC initial expression of interest in the proposed changes to the CWB followed the Minister’s comments. In a May 26, 2011, letter to the Minister, BAC noted that: “Canada’s bakers are one of, if not the largest, regular and highest return customers to Canada’s grain producers. As such we have a keen interest in any changes that may occur relating to the sale and supply of grains currently administered by the CWB.”
BAC has not taken any position related to the change in the CWB’s mandate. However, bakers are focused on the need for existing risk mitigation practices to be able to continue uninterrupted during any transition in the CWB’s mandate. Specifically BAC is concerned about how bakers would be able to secure long-term contracts for Canadian wheat flour during and beyond the proposed ending of the CWB monopoly on Aug. 2, 2012.
Forward contracting is an essential tool for bakers to reduce exposure and risk associated with volatile commodity prices. The need for forward contracting is recognized by farm groups and the entire wheat supply chain. The Canadian National Millers Association has been very active at the political and bureaucratic level in bringing this matter to the attention of federal decision makers and in seeking solutions. However, at the time of
this article writing (midSeptember), no workable solution to the forward contracting obstacles has yet been identified.
The implications to Canada’s bakers if the forward contracting impediments are not resolved are that bakers wishing to contract for flour during this period may have to accept it made from U.S. versus Canadian wheat.
AAFC has advised BAC that it has no intention of initiating formal consultations with the wheat supply chain regarding issues associated with a CWB mandate transition. In response, BAC has posed the following questions to AAFC on behalf of Canada’s bakers:
• Does AAFC recognize in today’s food processing industry the importance of risk management and the essential need for forward contracting of ingredient inputs?
• Is AAFC aware that inaction in addressing the risk mitigation needs of the western Canadian wheat flour users could force industry to source wheat and wheat flour from the United States? Considering the number of months ahead before the anticipated passage of the amending legislation, this could result in significant loss of business by Canadian to U.S. ingredient suppliers.
• Will AAFC be providing an urgently needed risk mitigation forward contracting mechanism of western Canadian wheat beyond Aug. 1, 2012, as part of the transition in the Canadian Wheat Board’s mandate? If so, when? If not, why?
BAC will continue to dialogue with AAFC and the wheat value chain in support of the effort to remove impediments to forward contracting. BAC is also anxious to review the proposed legislation to change the CWB mandate to determine if other issues may arise that negatively affect Canada’s bakers.
Ontario Institute of Food Processing Now Open
As a result of the joint effort of the Ontario food processing industry, government, and Conestoga College’s Institute of Food Processing Technology (IFPT), the initial class of Food Processing Technicians commenced their studies this September.
The two-year Food Processing Technician diploma program includes three semesters of in-class study where students combine practical knowledge in small classrooms, mechanical shops, laboratory settings, and a pilot plant, with different processing lines. Students in the program will receive training in mechanical and electrical systems and industrial maintenance as they apply to a food manufacturing operation, and will have intensive hands-on mechanical experience with food processing equipment.
Students will also have the opportunity to complete a 15-week paid co-op work placement. This will give students the opportunity to integrate their academic study with practical real-life work experience and will prepare them to be an immediate contribution to the industry upon graduation. Students will be ready to start their co-op work term in May 2012.
If your organization is interested in offering work placements or would like to contribute to entrance scholarships or academic achievement awards, please contact Susan McLachlan at 519-728-5220, extension 2499 or via e-mail at ifpt@conestogac.on.ca.
Holiday Social
Friday, November 25th, 2011
The Party Continues....
Pavilion Royale 5165 Dixie Road
Mississauga
http://www.pavilionroyale.com
Program:
Cocktails: 6:00 pm
Buffet Dinner: 6:30 pm
Dueling Pianos: 6:30 pm
Yuk Yuks Show: 9:00 pm
Classic Band: 9:30 pm
(All under one roof)
Cash Bar
Registration Fees:
$89 per member
$109 per non-member
Pre-register by November 7th 2011
Reservations for tables of 8 accepted
Holiday Social
Friday, November 25th, 2011
The Party Continues..
NEW BIGGER LOCATION
Your evening includes:
Buffet Dinner while listening to the Dueling Pianos
Followed by entertainment provided by Yuk Yuks (private show)
And finish the night with music by Jeff Morrison and the Classic Band!
All under one roof!
Join us and celebrate the season with Excellent Food, Great Entertainment and good friends in the Baking Industry.
t he B ook an D itS Cover
The classic image of Lady Justice depicts her holding a balanced scale and wearing a blindfold. The message is clear: The value of something shouldn’t be swayed by appearances. If that were true, every marketer in the world would be out of a job because it’s their mandate to seduce consumers by appealing to their senses and sensibilities. Your baked goods are no doubt delicious to see, taste, smell and touch, but is the vessel worthy of its cargo? When it comes to your packaging, are you really doing your products justice?
Packaging is a vital part of the marketing mix. When it comes to product branding, attention is often focused on the advertising and product development with little emphasis put on the power of the package itself. To effectively assess how to develop the strongest package, it’s best to be clear about packaging’s purpose and potential.
whaT’s ITs ROlE?
Packaging can perform multiple roles, which vary according to the particular brand and category.
}• Packaging, as an extension of your merchandising strategy, should be considered the “silent salesman” due to its ability to influence consumers at the point of purchase. Packaging is the physical representation of a brand experience and therefore should be treated as a part of the overall communication strategy for your products.
deliver on that brand promise, people will take the product off their list of favourites.
• Packaging has a key role as an informational vehicle, carrying
Richer colours imply that the flavour is richer as well. Lighter colours suggest lighter types of foods. if you look at ice cream, you’ll notice this strategy in its decadent to lighter product categories.
details of the pricing, ingredients, handling and nutrit’ion.
• Once a product gets home, the packaging can continue the emotional connection between the brand and the consumer. The hope is it will prompt the consumer to keep buying it. Conversely, if the packaging and product fail to
• Packaging ensures your product’s freshness and keeps it from being physically damaged, both important aspects of deli’vering a wonderful experience to the customer.
whaT POTEnTIal DOEs PaCkagIng haVE TO InCREasE salEs?
Packaging’s true potential lies in its ability to attract and retain customers, but as we’ve come to understand, not all
customers are created equal. Some are creatures of habit and some can be brought over from the fence. Creatures of habit: Many studies suggest that the majority of purchasing takes place in “default” mode, where the shopper gives little serious consideration to choosing between brands. Default shoppers already know which brand they are after even before they go shopping. For these consumers, ease of location is vital. They want to find their favourite brand easily. If they struggle to locate their favourite brand, that lag time may open them up to other potential choices. Brands that are immediately identifiable are hugely powerful in ensuring the “default” shopper carries through with the purchase. As shoppers become more time pressured and more aware of brands, and are offered a wider breadth of choice, it will become increasingly difficult to interrupt the default shopping mode.
On the fence: Only a third of purchasing in retail outlets is called considered
Packaging is an extension of your merchandising strategy, influencing consumers at the point of purchase.
or unplanned (Source: Miller Zell, 2009). The term “considering consumers” is used to identify instances where consumers can be p’ersuaded to think about trying new products as opposed to buying their preferred brands. This could be because it’s a product they’ve not purchased before or because they don’t buy the item frequently. It could also be because they have been interrupted from their default mode, or because they don’t have a favourite brand in that particular
category. For these shoppers, the role of the package is to attract attention and incite trial. Using visually attractive packaging that features innovative colour, shape and graphic design can achieve this. Communicating a strong rational message (organic, low fat, etc.) or even offering a discoun’t or coupon can als’o accomplish this goal’.
Packaging has to play different roles depending on whether it’s intended to reach default or considering consum -
ers. If you’re an independent bakery, your customers are shopping among only your products. In this instance, you’re only competing with yourself. Therefore, the packaging strategy should be designed to encourage trial of new products, to create impulse sales (add on, increase average sale) or to migrate customers from a product you wish to phase out towards a product targeted for growth.
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The hunt for sustainable packaging options continues to be a strong trend. Consumers continue to look for eco-friendly packaging and this is especially true for women. Packaging Digest reports that “women are 14 per cent more likely than men to select environmentally-friendly packaging over non-‘green,’ more-convenient alternatives” in pointing to a recent study of 1,011 adults commissioned by the IP Solutions business of Thomson Reuters. Men surveyed were more apt to select products packaged to provide greater convenience. When looking for colours to feature on your products, it’s common to have red and blue in a category. It’s believed that we notice red more quickly than any other colour. People also have an instant connection to blue, a colour associated with “blue chip” investments, which means trust. Richer colours imply that the flavour is richer as well. Lighter colours suggest lighter types of foods. If you look at ice cream, you’ll notice this strategy in its decadent to lighter product categories. An independent bakery would be wise to employ the artisan look – brown cardboard with a see-through window and using such words as “handcrafted” or “baked fresh.” There’s also the clean and modern look (think bottled water) and the homespun look of brands like Pepperidge Farm or Quaker.
While one may argue that solid judgment comes from the heart, not the eyes, baked goods are something that appeals to all of the senses. That’s why we love them and that’s why they deserve a package that makes a strong argument in favour of purchase. Case closed! / BJ
Michelle Brisebois is a marketing professional with experience in the food, pharmaceutical, financial services and wine industries. She specializes in retail brand strategies.
By BRanDI COwEn
a taSte of Bli SS
Sisters Justina Wong and Sylvia Kathol, co-owners of Bliss & Co. Cupcakes and Desserts, are in entrepreneurial heaven, thanks to the success of their nut-free bakery concept.
Their first store opened in downtown Calgary’s Chinatown in February 2009, at the height of the recession. Tucked away on the lower level of a tall brown brick building, the bakery can be a bit difficult to find, but, as Kathol explains, “We were hoping people would be able to smell us.”
With a kitchen that can turn out as many as 1,500 cupcakes each day, there are plenty of mouthwatering aromas to lead hungry passersby to the door. Once inside, the 300-square-foot retail space is clean and white. A single bright red wall serves as a backdrop for the 14 to 16 cupcake varieties on offer from one day to the next.
“It’s not your really posh looking kind of bakery and really, our retail was a last-minute thought,” says Wong. “We were actually going to be situated here as a kitchen and market ourselves out, but of course, all these people started coming, so we did this little makeshift front retail.”
nuT-fREE anD ECO-COnsCIOus
Two years on, the retail aspect of the business is booming. Bliss & Co.’s red velvet cupcake is its bestseller, followed by its coconut cream cheese and flourless chocolate offerings. Other popular items include a variety of fruit and cream pies that fit in the palm of your hand, and decadent brownies. The treats have played a key role in the bakery’s success, but what really makes Bliss & Co. stand out from the competition is the fact that the entire operation is nut-free.
“My sister and I were going to open a regular bakery. We actually had a French macaron idea that we’d worked on,” explains Kathol. “When we found out how nut allergies impact something as simple as a birthday celebration, we decided to make the conscious decision to go nut-free for the sake of people with nut allergies and just cross our fingers.”
She adds, “If we went under, then at least for a year, we could provide cupcakes to kids and adults alike without any fear.”
Opening a nut-free bakery provided Wong and Kathol with a daunting challenge in additio’n to all the others ’ associated with starting a small business.
The pair learned that some supply companies operate multiple facilities, all making the same products. While some of these facilities may be nut-free, others process ingredients with nuts. To guarantee their customers’ safety, the sisters “verify and double verify” everything they buy, confirming that their ingredients are processed in nut-free facilities and seeking out alternative options.
“In the beginning, we had our mainstay suppliers,” Wong explains. “We have our chocolate that we’re using, and things like that, but we’d be naïve to think that these suppliers are going to provide us with the same product forever. They’re always changing their product, and so the biggest
challenge here is to find backup.”
But it’s not just being prepared that drives the sisters to continue exploring.
“We’re still evolving,” Kathol adds. “To this day, we’re still sampling chocolates from all over the world . . . . We’re still looking for the best product that we can buy that’s nut-free.”
In addition to lining up nut-free supplies, the sisters have also invested a lot of time and effort in running an eco-friendly operation.
“We are fully aware of how the cupcake industry is impacting the environment, specifically plastic packaging,” says Kathol. “I don’t like it, I wish I could get away without it.”
The pair spent a year working with three different suppliers, trying to find a more green packaging option.
“The option we were given was to use
Sisters Justina Wong (left) and Sylvia Kathol opened their nut-free bakery after realizing how drastically nut allergies affect something as simple as a birthday party.
cake boxes, and people just don’t want that. When they’re paying $3.10 per cupcake, they want it packaged nicely,” says Kathol.
In the end, the sisters had to compromise, settling on plastic packaging and bags with low PET numbers that can be recycled into a wide variety of products. At the moment, they give customers the option of plastic or cardboard packaging. Meanwhile, they continue to explore options such as biodegradable plastics, and are considering a switch to paper packaging, which raises new concerns.
“We don’t think it’s environmentally conscientious to use a paper product when it comes from cutting down more trees,” says Kathol. “We want to make sure the paper products we’re using are at least 30 per cent recycled materials.”
Bliss & Co.’s young staff has taken this eco-consciousness to heart, and the entire operation makes every effort to be as green as possible. Every day, Wong and Kathol load up their delivery van, carting away recyclable waste, and the kitchen and equipment is scrubbed down with green cleaning products.
“That’s the best we can do right now,” says Kathol.
BuIlDIng ThE BusInEss
Despite opening its doors in tough economic times, and being the third cupcake store in the city, Bliss & Co. wound up being profitable. In fact, the bakery became so popular that last September, the sisters opened a second store in Calgary’s Chinook Centre.
“At the beginning, it was really hectic. We thought we were really well prepared, but at the end of the day, Calgarians are unpredictable. At the same time, our opening caught a lot of publicity,” Wong says.
The day their second location opened, Aerosmith front man Steven Tyler just happened to be visiting the Chinook Centre. With the promise of cream cheese icing and moist, red velvet cake, Wong lured the rock legend to the store. This helped Bliss & Co. build some serious media buzz around their new location, as well as their brand.
“You estimate how busy you’re going to be for the first few weeks, but it was actually way busier,” explains Wong. “It caught us off guard, so staffing was an issue.”
The lessons learned from opening that second store will be put into practice this fall, when a third location opens for business.
When they first hatche’d the plans for a s’econd location, the’ pair planned to split up. Kathol, the baker, intended to remain in the kitchen at the Chinatown location, while Wong, the management-minded sister, planned to stay busy at the Chinook location, setting up the store, establishing procedures
fOuR ways TO fInD yOuR nIChE
• Identify something your business can do that the competition can’t or won’t. make this your niche.
• Spread the word. Use word of mouth, traditional advertising, the web and social media to help potential customers find you.
• work with suppliers to determine which products fit your niche. If none exist, explore what you can do to create some.
• Look for opportunities to expand into new areas, and don’t be afraid to evolve. Changing with the times can help you defend your niche from copycats, and bring new customers into the fold.
and overseeing the day-to-day business of the retail outlet.
But, Wong says, “We realized that if you hire a strong manager, and if you’re able to train them properly, you don’t have to be there all the time. We still show our faces there, but we realize that the heart of this whole business is the bakery.”
After the holiday rush was over, the two decided to station themselves at their head office, in the Chinatown location and trust the manager to run the show at Chinook. Wong notes that it’s “very simple, basically just retail – selling the cupcakes –and making sure quality control is there.”
Since the first Bliss & Co. store opened its doors, Kathol and Wong have learned a lot about what it takes to run a successful business, in good financial times, as well as in bad, though they don’t necessarily agree on what those lessons are. When asked to reflect on what they would change, given the benefit of hindsight, they have two very different outlooks.
“In my opinion, spend the money and hire more staff,” Wong says, laughing. “When we opened, it was just my sister and I, and we didn’t anticipate being so busy. I wish we’d hired just two extra staff . . . . That would have helped us a lot. We wouldn’t have been so crazy and so stressed out if we’d actually allocated a certain budget for staff to help us.”
But Kathol has a different take on things. “I totally disagree. I think we did everything right, especially in the environment,” she says, confidently. “We started off with a staff of two and we just progressively grew from there. We were able to learn, we were able to make mistakes, and then resolve the mistakes in a timely manner.” / BJ
¦ business advisor ¦
By PATR i C i A hARR i S AND Jo NAS Coh EN
BuyiNg AND SELLiNg
This step-bystep advice will help you get the most out of your business, whether you’re a buyer or a seller.
Whether you are looking to sell your business or make an acquisition, having a true picture of what your business is worth is critical to a successful transaction. The following article will take you through a step-by-step process designed to help you maximize the value of your business.
MaxIMIzE yOuR sEll
You may find yourself in any number of circumstances prompting the sale of your business. Everything from the lack of a logical successor, a dispute with another shareholder, the need to withdraw built-up cash in the business, an unsolicited offer to buy the business, poor health or simply the wish to retire may initiate the sale process.
}the company. Rank potential buyers in order of their likely interest and their ability to actually purchase the
in the same way that the seller should consider business operations and management, a strategic purchaser of a business will assess a company’s value.
It is not uncommon for an owner who is already engaged in the sale process to withdraw when he or she understands the full implications of the sale. Owners have likely nurtured the business into what it is today, and the prospect of letting go may be too much to bear.
Working with a business advisor, you should seek to understand the motivation and rationale for the sale. This understanding allows you to work together to structure a sale that will meet your objectives.
Once you are committed to a sale, the next step is to maximize the value of your business.
A combination of fi’nancial and management considerations will go a long way to getting the most for your business. Consider the following:
1. Target the buyers – Knowledge of your industry puts you in the best position to identify logical buyers for
business. Consideration should be given to companies that might be willing to pay for strategic advantages, known industry acquirers, previous offers for the business, long-term employees, existing partners and management groups.
2. Identify acceptable forms of consideration – Must it be all cash, or are vendor take-backs, leasing arrangements, preferred stock or earn-outs, or price bridging opt’ions?
3. Assess the personal and corporate tax consequences ofi the sale –Structuring the sale in the most tax advantageous way is critical to maximizing value. Typically, vendors will want to sell the shares of a business as opposed to its assets in order to take advantage of the capital gains exemption that may be available to Qualified Small Business Corporation (QSBC) shareholders. Also assess internal tax minimization strategies prior to a sale.
4. Tidy up and paint a profitable picture – Make sure that your company’s financial information is available,
complete and accurate. Consider normalizing the historical financial statements. For example, adjusting for uneconomical management remuneration and salaries paid to non-working family members. A purchaser is buying the prospective future cash flow of the business and a well-thought-out financial forecast will go a long way in providing comfort in the assessment of the business.
5. Diversify management – A business that depends primarily on the personal goodwill of the owner will not be attractive to potential purchasers. Assessing the calibre and diversity of the management team is an important part of any purchaser’s due diligence. Broaden and strengthen the middle management team to maximize the value of a business.
6. Assess if the timing is right – If there is no urgency to sell, perhaps value would be maximized when there are more potential buyers. Alternatively, there could be industry consolidation opportunities that are best taken advantage of with an offer in hand.
7. Recognize that first impressions are extremely important – Whether meeting potential purchasers in person or providing an information memorandum, human nature dictates that the first impression given by the vendor will impact negotiation’s and ultimately the’ terms of the deal.
gET ThE MOsT fROM yOuR aCquIsITIOn
A strategic purchaser will assess a company’s value. By reviewing the company’s management and operations, contracts, commitments, the industry, the market and the competitive environment, you will get a good sense of whether the acquisitions makes sense for your existing business.
Once you decide to move ahead with the acquisition, the structure of the deal vand the ongoing strategic plan will need
to be developed. The due diligence will include a legal and financial review. Some of the more common issues uncovered during the due diligence process include:
1. An overstatement of inventory value
2. Uncollectible receivables
3. Window dressing of financial statements including the deferral of necessary capital or repairs and maintenance expenditures
4. Weak or disadvantageous contracts
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5. Employee turnover or union contract issues
6. Lease issues
7. Restrictive franchise or license agreements
8. Unrecorded liabilities including supplier discounts, employee costs and severance
9. Pending litigation against the company
DETERMInIng ThE RIghT PRICE
The value of a business needs to be viewed in an overall context. Generally, if the demand for a particular business is high, the vendor may not want to disclose an asking price in order to create a competitive biddi’ng situation and d’rive up the price. If the power is with the purchaser, the vendor may have no choice but to state an asking price.
Historical results of a business are not necessarily a good ’indication of expe’cted ongoing performance. This can make a valuation assessment particularly tricky and the need for sound valuation, tax and legal expertise imperative.
gET ThE RIghT aDVICE
Chartered business valuators (CBV) and mergers and acquisition (M&A) advisors may perform various roles in the purchase and sale of a business, from helping structure the deal, to assisting with the due diligence process. While the sales process may seem daunting, it’s critical that both the vendor and the purchaser have a clear understanding of the business, the industry and the motivation for the sale. Advisors should work with you to assess the value of the business and make informed decisions. / BJ
Patricia Harris, CA, CBV, is a senior manager of Fuller Landau Valuations Inc., and Jonas Cohen, MBA, CA, is the managing director of Fuller Landau Advisory Services Inc. Fuller Landau provides tax, accounting and business advisory services to owners of growth–oriented, mid-size businesses. www. fullerlandau.com.
TakE-away TIPs
1. Valuation is tricky as history does not always predict the future.
2. Don’t underestimate the value of doing full due diligence.
3. Fully appreciate the complexity of making a great buy or sale.
From healthy breads and granola bars to precision scales and heated merchandisers, Bakers Journal keeps you “in the know.” for more on new products for the baking industry, check out our website, www.bakersjournal.com
g. Cinelli-Esperia trough elevating system
G. Cinelli-Esperia’s trough elevating system is designed to execute countless operations. whether fermenting dough or moving large batches ergonomically and efficiently, a system can be configured to meet your operation’s needs. The trough elevating system can be augmented with G. Cinelli-Esperia’s supplemental hopper/chunker. www.cinelli.com.
lycoRed sante salt enhancer
Lycored Sante is a patented, natural tomato concentrate designed to enhance taste without artificial flavours or flavour enhancers. In many cases, the company says it can be used to reduce the amount of salt added to a product. Lycored Sante is available in liquid form or as a free-flowing powder. It is billed as heat resistant, stable at almost all pHs, and suitable for ambient, frozen, baked, cooked and fried products. www.lycored.com
Candy & Deep fry Thermometer
Component Design northwest proaccurate Insta-read
Candy & Deep Fry Thermometer (IrXL400) is designed for use with candy, jelly, deep-frying, yeasts and dough. a colour-coded target range indicator and a large dial make for easy viewing. The IrXL400 has a range of 100 F to 400 F and is designed for easy recalibration. www.cdn-timeandtemp.com
Poco
Moulder from Bloemhof
Bloemhof’s poco moulder features heavy-duty construction, compact countertop design, and an in-feed safety hopper with automatic shutoff.
sugar glues from get sassie!
SassieSap is a two-way liquid sugar glue that can be used, wet or dry, to apply decorations to fondant cakes and cookies. It comes with a convenient applicator and can be applied up to 12 hours in advance. SassieStick is a clear-drying edible sugar glue stick created to stand up in even the most humid environments. www.getsassie.com
Cara Crakine from Cacao Barry Cacao Barry’s Cara Crakine is a ready-touse inclusion made from toasted biscuit cereal enrobed with fine caramel milk chocolate.
Cara Crakine is designed to add crunchy texture and a caramel and biscuit taste to a variety of pastries, desserts and other confections, including cake bases, cake inserts, truffle filling and tablet filling. www.cacao-barry.com
stack’R pallet from Orbis Corporation
The Stack’r pallet allows customers to use it in both stacking and lightweight racking applications. The 40.0 x 48.0 x 5.9 foot Stack’r’s foam moulded structure was developed to be smooth and non-porous to avoid absorbing moistures or odours. Custom options include open or closed deck, edge-racking capacities from 750 to 1,500 pounds, optional lip or factory installed grommets, and contoured corners to reduce product damage. www.orbiscorporation.com
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Manufacturers of: Depositors, Transfer Pumps, Metal Detector Conveyors, Conveying Systems, Custom Built Equipment, Baking and Proofing Racks and Used Equipment. Sales and Service
You can tailor and expand your product lines to help serve the growing number of people afflicted with diabetes
Today, more than nine million Canadians live with diabetes or prediabetes (impaired glucose tolerance). An estimated one million people are undiagnosed. Out of the 2.7 million Canadians with diagnosed diabetes, 90 per cent (2.4 million) are type 2. Carolyn Gall Casey, director of professional education for the Canadian Diabetes Association (CDA), explains that the rates are increasing among children and youth. She says diabetes cost the Canadian health-care system and economy $11.7 billion in 2010 and that figure will rise to $16 billion by 2020. To date there is no proven way to prevent type 1 diabetes; in contrast, Gall Casey estimates that more than 50 per cent of’ type 2 diabetes could be prevented or delayed with healthier eating and increased physical activity. The CDA’s website offers a variety of nutrition resources, from the Just the Basics Portion Guide to carbohydrate counting and glycemic index information.
}Michael’s Hospital, Toronto.
“The health benefits of making accurate, nutritional choices that attenuate your blood glucose levels based on information, such as the glycemic index rating, are far-reaching,” she says. Dr. Jenkins will be presenting “Are All Fibres Created Equal?” at the National Canadian Diabetes Association/Canadian Society of Endocrinology and Metabolism Professional Conference and Annual Meetings in Toronto in late October.
The CDA dietary recommendations include 45 to 60 per cent of the daily calories coming from carbohydrates. In addition to providing consumer education resources, Sharon Zeiler, BSc, MBA, RD and senior manager of diabetes education and nutrition for the CDA, explains that the CDA has been approached by artisan bakers asking for advice about how to incorporate more fibre, sugar substitutes and low glycemic index ingredients into
Nana’s Bakery’s daily diabetes-friendly offerings include eight varieties of muffins and an assortment of cookies, turnovers, pies and cakes.
People living with diabetes have specific dietary requirements to help manage their blood sugar levels.
People living with diabetes (and their family and friends) understand the positive effects of healthy, low-glycemic index foods on blood glucose stability and are seeking out a variety of bread and baked products that meet their requirements.
“As bakeries are developing new recipe selections, in addition to the white and whole wheat base, we are observing more glycemic index testing with bread products containing whole grains, sprouted grains, pulse flours, sourdough, flax, salba seeds and chia,” explains Alexandra L. Jenkins, PhD, RD and director of research for Glycemic Index Laboratories in Toronto. Dr. Jenkins is a longtime volunteer for the Canadian Diabetes Association within her role as the senior research associate at the Risk Factor Modification Centre at St.
their baked goods. Zeiler suggests that more bakeries are addressing consumer needs through expanding their product lines, and/or shrinking portions. With the rise of diabetes among children and youth, it is important for families to include healthier bread choices for children. Zeiler advises that higher-fibre, less refined breads should be introduced to children often, at a young age, so they can develop the palette for them.
Fourteen years ago, when Doug Romanek bought an existing bakery in Windsor, Ont., he was not a baker nor did he know how his newly acquired business would transform into a specialized company for people with diet-related conditions, including diabetes. Today, Nana’s Bakery’s daily diabetes-friendly offerings include eight varieties of muffins and an assortment of cookies, turnovers, pies and cakes. The ingredient list for the muffins includes whole grain flour (local, if he can source it), flax seeds and oats. The cookies (“Yuckies” are one store favourite) start with whole wheat flour, oats and a special ingredient mixture
consisting of dates, raisins, spices and orange juice. Romanek was careful not to give away exact amounts of the mixture, as it is his own proprietary blend. With minimal refined white sugar used in the entire bakery, Nana’s supplies local restaurants and other bakeries with their diabetes-friendly baked goods. Romanek works with another baker in training to create special order diabetic cakes for many birthdays celebrated at local nursing homes in the Windsor area. Romanek has continued his commitment to the diabetic community by partnering with local dietitians and the CDA to provide diabetic cooking classes to groups of 10 to 25.
As type 2 diabetes is often triggered by obesity and inactivity (noting that complications of th’e disease account ’for more than 80 per cent of diabetes costs), healthy eating strategies need continued support through consumer awareness, education and a range of accessible nutritious food choices. This is a timely opportunity for bakers to augment their product lines with diabetes-friendly breads and baked alternatives. / BJ
Jane Dummer, RD, is a leading dietitian for the Canadian food and nutrition industry. Jane offers services specializing in agri-food, functional foods and food safety. For more information, visit www.janedummer.com.
BETTERLOOK I N G GOURMET COOKIE
A T R U E S T O R Y : We met a bak was producing gourmet cookies –heavy, thick cookies with lots of large chunks of chocolate, fruits, nuts and other inclusions In an effort to increase production, she went from hand-scooping to a w However, she ran into big problems w she couldn’t maintain portion contro getting cut into smaller, less impressiv chunks were smeared under the coo
Then she called Reiser The s cookie dough depositor with a guill production speeds, the Vemag allo recipes with precise portioning accur and inclusions came through whole system actually exposed the chunks Now she is able to produce mouth-wa with great eye appeal that out-sell all t in the bakery case.
Through years of research and hands-on experience, we’ve learned a thing or two worth sharing. So when it comes to things like the newest trends and decorating ideas, displays and merchandising tactics, we’ll find ways to help you move your business forward. The future of your bakery is out there waiting, and we can help bring it into focus. Contact Dawn at 1-866-277-3663 or e-mail us at dawncanadacs@dawnfoods.com or online at dawnfoods.com
