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American Bakers Association 2012-2013

ROI REPORT

The Voice of the Baking Industry Since 1897


WHAT IS ABA? MISSION... To be the leading voice for the baking industry.

VISION...

To grow and enhance the baking industry through public policy advocacy, education and networking opportunities.


Leadership letter

REFLECTING...

on a Successful Year for the Industry IT

HAS BEEN A FASCINATING YEAR FOR THE INDUSTRY.

COMMODITY VOLATILITY, SHIFTING CONSUMER TASTES

CONSOLIDATION,

AND EXPECTATIONS —AND A HOST OF OTHER ISSUES HAVE IMPACTED OUR COMPANIES. Through it all, ABA has remained a constant — constantly fighting for your interests in Washington and the states, constantly supporting the industry and its products, and constantly providing a forum for the entire industry to gather, strategize and develop solutions. In the past year alone, ABA has claimed many considerable victories on behalf of the industry. We led the united industry’s effort to promote grains on the new MyPlate icon. We continued the fight on food safety — squashing legislation proposing registration fees of up to $185,000 per company. We quickly mobilized to fend off a proposal that would have forced bakers in Ohio and Indiana to install catalytic oxidizers on proofers — a threat that could have exceeded $500,000 per line. As you will see illustrated in the coming pages, ABA isn’t just about advocating for the industry. We are the vehicle for the industry to unite in common purpose — to strengthen, grow and flourish even in the most challenging of environments. This Return on Investment report details the important work we successfully accomplished on the industry’s behalf this past year. Of course, ABA cannot really take credit — each and every achievement has been made possible by the continued commitment and active participation of its members. During this period of rapid change for our industry, we appreciate your investment and trust more than ever. We know you make tough decisions every day, and that you have your choice of different routes when it comes to advocacy and associations. We thank you for placing your confidence in ABA. With our members behind us, we look forward to another year of fighting and winning for your company’s interests. Best wishes for a very prosperous year.

ABA Chairman Robin Alton, Pan-O-Gold Baking Company

ABA President & CEO Robb MacKie


ADVOCACY IN ACTION 9 1

2

3

1 1

4 1

17

1

6

4

20


250

CONGRESSIONAL OFFICE VISITS 1

5

3

3

1

17 4

6

5 12 11 17 2 10 8 4 13 8 6 7 1 3 15

5

0

5 Sugar Reform Farm Bill Ethanol Nutrition School Meals

• • •

SNAP Labor Issues Hours of Service Commodities

2 2

2 3 7


ABA FIGHTING FOR

SUGAR REFORM MORE THAN 250 CONGRESSIONAL VISITS SINCE JULY 2012 — WHAT’S NEXT? The current U.S. Sugar Program costs bakers and consumers billions of dollars each year. Despite receiving a record number of votes and ABA’s aggressive efforts to reform the current program, the U.S. House of Representatives rejected the modest amendment to the farm bill that would have helped level the playing field for bakers and consumers alike. ABA will continue to work to reform the current sugar program.

Left: ABA’s Cory Martin speaks at a sugar reform press conference held at a Pepperidge Farm Plant. Right: McKee Foods Corp. presents Sugar Reform Champion Rep. Markwayne Mullin with a PAC check.

BUILDING RELATIONSHIPS WITH NEW MEMBERS OF CONGRESS On a monthly basis, ABA hosts food industry and business community roundtables for up and coming freshmen members in the U.S. House of Representatives. Members of Congress are chosen based on their ABA member facility presence in the district and congressional committee assignments. Oftentimes these events lead to meaningful relationships between the representative, his/her staff and ABA. ABA members are encouraged to attend.

ABA meets with Rep. Jackie Walorski (R-IN).

6 A Look at Your Return on Investment

ABA meets with Rep. Luke Messer (R-IN).


ABA EDUCATING ON

HEALTH CARE REFORM HOW IS ABA EDUCATING THE INDUSTRY ON HOW TO MANAGE HEALTH CARE REFORM?

Human Resources Chair John Wagner, The Kroger Co., Rep. Judy Biggert (R-IL), and Logistics Chair Bob McGuire, Alpha Baking Co., at the 2012 Summer HR Conference.

ABA dedicates time during each Human Resources & Labor Conference to give updates on PPACA’s implementation (the Patient Protection and Affordable Care Act, or “Obamacare”) and what bakers should expect over the coming months. Leading speakers from Littler and Lockton Companies have provided keen insights to inform decision makers at every conference since 2009. ABA has held webinars to update bakers on the quickly-changing PPACA regulations. ABA sends monthly updates to HR and labor professionals in the baking industry to keep them updated. “The unpopularity of ‘Obamacare’ is at its height. There will be no net increase in lives covered [by insurance], but a massive increase in cost,” said Rep. John Fleming (R-LA) at the 2013 ABA/ATBI Joint Boards meeting. ABA ROI 2012-2013

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FOOD SAFETY EFFORTS PAY OFF FOR INDUSTRY

$$$

ABA EFFORTS LEAD TO FSMA EXEMPTIONS FOR BAKERY DEPOTS — INDUSTRY SAVES MILLIONS

ABA is focusing on bakery-specific impact as implementation of the Food Safety Modernization Act (FSMA) continues to roll out. ABA spearheaded a successful petition leading others in the food industry in calling for an exemption for depots and warehouses from preventive control requirements. ABA testified before FDA officials reinforcing the call for an exemption and also called for an additional exemption for innovation centers that don’t introduce food or samples for interstate commerce. Savings to bakers would be $15-$20K per depot/warehouse each year. ABA SVP Lee Sanders testifies on exemption of bakery depots.

ABA LEADING BAKERS IN FOOD DEFENSE • • • •

Company Information Vulnerability Assessment Emergency Contacts Self-Assessment

• • •

Broad Mitigation Strategies Focused Mitigation Strategies Action Plan

ABA PREPARES BAKERS FOR NEW REQUIREMENTS ABA’s Environmental Pathogen Management Program Overview document is designed to raise awareness around the area of environmental microbiological risk. The document highlights major areas that bakeries should consider in developing an environmental pathogen management program.

SAVINGS...

$185K

PER BAKERY PER YEAR

8

A Look at Your Return on Investment

ABA KEEPS REGISTRATION FEES OFF THE TABLE ABA continues to strongly oppose any type of registration and user fees to fund FDA FSMA-related activities. The Administration has once again included registration fees and enhanced service fees in their Fiscal Year 2014 budget as a way to fund its new responsibilities. ABA continues to successfully support appropriated funds and oppose food taxes, for FDA food safety activities including FSMA implementation.


ABA IMPACTS NUTRITION & LABELING POLICY CHANGES TO SCHOOL LUNCHES MEAN BIG CHALLENGES FOR BAKERS ABA is spearheading efforts to permanently eliminate grain maximums for school meals. Recently, ABA organized 20 grain organizations to urge USDA to quickly allow greater flexibility and additional bread and grain products into the program.

ABA WORKING TO PRESERVE CHOICE IN USDA SNAP PROGRAM FOODS ABA has actively worked with a broad coalition of food industry and hunger groups to preserve food choice in the USDA SNAP program. ABA also led the group to emphasize the importance of access to healthy foods including whole grains. ABA EDUCATES POLICYMAKERS ON SODIUM REDUCTION EFFORTS ABA continues efforts to educate policy influencers on the progress bakers have made in sodium reduction in their products. In February, ABA met with key officials from the Centers for Disease Control and Prevention (CDC) to discuss bakers’ successful progress. In May 2013, the Institute of Medicine, consistent with ABA’s position, maintained that there was insufficient scientific data to recommend sodium reductions below the current daily recommendation of 2,300 mg per day. ABA ALLERGEN RESOURCES FOR THE BAKING INDUSTRY In April 2013, ABA released its new Allergen Resources for the Baking Industry document that includes links to FDA regulations and question and answer documents, industry best practices, consumer organization contacts and international sources for information on allergens. This useful document was developed by the ABA Allergen Subcommittee of the ABA Food Technical Regulatory Affairs Committee (FTRAC).

USDA COMMENDS ABA AND GRAIN CHAIN FOR NUTRITION MESSAGES ABA, a National Strategic Partner for USDA MyPlate, partnered with other grain chain partners and USDA to develop a series of five grain health-focused videos that were highlighted September through December 2012. USDA has touted the grain chain’s successful efforts as a model for other food groups and key nutrition messages. ABA ROI 2012-2013

9


ABA CELEBRATES HEALTHY BABIES MONTH.

AMERICAN BAKERS PAC FLY-IN — ABA MEMBERS VISIT CANDIDATES UP FOR ELECTION.

JULY HOT DOG LUNCH 2012

ABA OPPOSES IN-PLANT PHOTOGRAPHY DURING INSPECTIONS.

PAC FUNDRAISER FOR SENATE CANDIDATE JOSH MANDEL AT THE BUNDY BAKING MUSEUM IN URBANA, OH

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A Look at Your Return on Investment

ELDC PUBLIC POLICY FORUM – OVER 40 ABA MEMBERS VISIT 20 OFFICES ON CAPITOL HILL.

CAPC FLY-IN — MEMBERS DISCUSS SUGAR REFORM AND COMMODITY VOLATILITY WITH MEMBERS OF CONGRESS.

THE FIRST ABA ENERGY STAR® TOO FOR COMMERCIAL BAKERIES IS ISSUED.

USDA RECOGNIZES ABA FOR EFFORTS ON MYPLATE.

ABA’S EFFORTS PAY OFF — USDA WAIVES GRAIN MAXIMUMS FOR 2013-2014 SCHOOL YEAR. ABA/ATBI BOARDS DISCUSS INDUSTRY SOLUTIONS AT JOINT BOARDS MEETING.


OL

ABA URGES CONGRESS TO PASS THE PREVENTING GREATER UNCERTAINTY IN LABOR MANAGEMENT RELATIONS ACT.

D.C. CIRCUIT COURT INVALIDATES NLRB APPOINTMENTS

ABA/H&S TESTIFY TO MARYLAND HOUSE OF DELEGATES ON TRAY LOSS, WHICH PASSED 4/3/13.

$$$ ABA’S PETITION EFFORTS ON WAREHOUSE EXEMPTION COMES TO FRUITION — A MAJOR COST SAVINGS FOR BAKING COMPANIES.

ABA HAS DIALOGUE WITH CDC OFFICIALS ON KEY PUBLIC HEALTH ISSUES.

SUGAR REFORM PRESS CONFERENCE — PEPPERIDGE FARM, DENVER, PA

ABA HOLDS MEET & GREET FOR REP. RICHARD HUDSON (R-NC).

AMERICAN BAKERS PAC FUNDRAISER FOR REP. JOHN KLINE (R-MN)

ABA ALLERGEN RESOURCES DOCUMENT RELEASED.

ABA & ATBI JOINT BOARDS OF DIRECTORS MEET TO DISCUSS INDUSTRY SOLUTIONS — DINNER, HILL RECEPTION AND TOUR HIGHLIGHT MEETING.

MEET AND GREET WITH REP. LUKE MESSER (R-IN)

ABA ROI 2012-2013

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AMERICAN B

THE POLITICAL ACTION COMMI

AMERICAN BAKERS PAC CHAIRMAN STEVE AVERA, FLOWERS FOODS

WHAT IS AMERICAN BAKERS PAC? The American Bakers Political Action Committee (PAC) works diligently to elect pro-business, free enterprise candidates to the United States Congress and Executive Branch. American Bakers PAC is funded through voluntary, personal contributions from individuals who belong to the restricted class of authorized ABA member companies.

2013 AMERICAN BAKERS PAC DINNER CONTINUES TO BREAK RECORDS

2013 AMERICAN BAKERS PAC DINNER SPEAKER —DR. CHARLES KRAUTHAMMER ELECTION SCORECARD

The American Bakers PAC Dinner is the primary fundraising event held every spring at the ABA Convention. This year’s PAC Dinner featured renowned author and political strategist Dr. Charles Krauthammer. Many thanks to Berry Plastics for sponsoring the dinner. HISTORY IN THE MAKING...FUNDRAISING REACHES $144,000, RECORD TURNOUT OF 200 PAC MEMBERS The 2013 American Bakers PAC Dinner in Florida was the most successful PAC fundraising event to date. Dr. Krauthammer captivated the audience with his analysis of the Obama Administration. American Bakers PAC Chairman’s Circle Members contribute a minimum of $5,000 per calendar year. Dr. Krauthammer with PAC President’s Club members Fred and Debbie Springer, Burford Corporation.

PAC CONTRIBUTED OVER $300K IN THE 2012 CYCLE TO FEDERAL CANDIDATES, LEADERSHIP AND PARTY COMMITTEES.

Dr. Krauthammer with PAC Chairman’s Circle members Ken and Linda Newsome, AMF Bakery Systems.

PAC CONTRIBUTIONS COME DIRECTLY FROM ABA MEMBERS CONGRESSWOMAN VIRGINIA FOXX (R-NC) VISITS DEWEY’S BAKERY.

12 A Look at Your Return on Investment

American Bakers PAC is one of the few trade associations that sends PAC contributions directly to ABA Members to present – which means American Bakers PAC dollars in your hands.


BAKERS PAC

ITTEE OF GRAIN-BASED FOODS

PAC ROUNDTABLE FOR VIP CONTRIBUTORS

AMERICAN BAKERS PAC FOLLOWS STRICT CONTRIBUTION GUIDELINES .

The American Bakers PAC Roundtable with Dr. Charles Krauthammer was held on April 22 prior to the PAC Dinner at the ABA Convention. The Roundtable is open to PAC Members who contribute at the $2,500 level or higher. Many thanks to AMF Bakery Systems for sponsoring the Roundtable.

AMERICAN BAKERS PAC CONTINUES TO BREAK FUNDRAISING RECORDS Thanks to the generous support of ABA baker and allied members, and the leadership of PAC Chairman Steve Avera, Flowers Foods, American Bakers PAC has achieved outstanding strides in fundraising over the last five election cycles.

$302,500 $252,000

$300,000 $250,000 $200,000 $150,000 $100,000

$202,000 $145,000 $97,600 ABA’S GRASSROOTS CENTER — WWW.RISETOACTION.ORG

$50,000 $0

THE AMERICAN BAKERS PAC ROUNDTABLE HOSPITALITY WAS GRACIOUSLY SPONSORED BY AMF BAKERY SYSTEMS.

2003-04 2005-06 2007-08 2009-10 2011-12

PAC CHECK TRANSMITTALS

RISE TO ACTION: ABA’S GRASSROOTS CENTER Have you visited ABA’s members-only resource www.RiseToAction.org? Write your Member of Congress, access key voting records, learn about redistricting and stay on top of the latest political news all in one place.

THE ABA PLANT VISITATION PROGRAM — IS YOUR COMPANY A PARTICIPANT? ABA also arranges for Members of Congress, or candidates, to visit ABA members at their bakeries or allied facilities. This is a critically important opportunity to network and educate current and potential policymakers on what it means to operate a successful bakery or allied operation.

ABA ROI 2012-2013

13


ABA CONTINUES HOURS OF SERVICE FIGHT ABA HAS WORKED TO MITIGATE THE IMPACT OF HOURS OF SERVICE TO THE BAKING INDUSTRY FOR OVER A DECADE... ABA has led efforts to revise the HOS regulations since the rulemaking process began in 2003. ABA has fought to mitigate any negative impact on the baking industry including increasing the cost of transporting and delivering fresh baked goods. The baking industry operates the fourth largest fleet of vehicles in the U.S. behind the U.S. Postal Service, FedEx, and UPS. Increased Hours of Service regulations are very costly to the industry.

ABA, along with 14 other industry groups representing most sectors of the domestic economy, filed an amici curiae brief last summer in support of the American Trucking Association’s challenge of the Federal Motor Carrier Safety Administration’s (FMCSA) Hours of Service (HOS) Final Rules. Portions of this rule will slow productivity, hurt jobs and have a negative impact on agriculture, manufacturers, retail supply chains and distribution operations. ABA gave testimony on the challenges the changes in the HOS final rules will mean for industry, however there is nothing to indicate that the court is ready to throw out any part of the FMCSA’s rule at this time. The new rules went into effect as planned on July 1, 2013. ABA will continue to work with other industry groups, as well as reach out to legislators and the FMCSA to communicate the impact of the HOS rules on the baking industry and seek ways to mitigate its impact.

14 A Look at Your Return on Investment


SOLUTIONS FOR THE BAKING INDUSTRY ABA PUSHES FOR MODEL TRAY LOSS LAWS — WINS MAJOR VICTORY IN MARYLAND ABA President & CEO Robb MacKie, and JR Paterakis of H&S Bakeries, testified before Maryland lawmakers in support of legislation to strengthen penalties for theft of trays. The law also creates a civil right of action to combat the wholesale theft of plastic bakery equipment. H.B. 1088, introduced by Delegates Doyle Niemann (D-PG) and Michael Vaughn (D-PG), was a huge win for the baking industry, as the bill was unanimously approved in both the Maryland House of Delegates and the Senate. This victory will create a model for tray loss laws nationwide.

TOUGHER PENALTIES PASSED IN MARYLAND

TRAY LOSS GETS NATIONAL ATTENTION

A sudden spike in tray theft has resulted in an excess of $100 million worth of lost equipment and countless operational disruptions. ABA has been working for years with C.O.M.B.A.T., a non-profit organization formed my manufacturers using returnable containers for the exclusive purpose of COMBAT (Control of Missing Baskets and Trays), to raise awareness and discourage bakery tray theft.

“This legislation puts Maryland at the forefront of the nation on this important issue and serves as a model for other states to follow.” — Robb MacKie, ABA President & CEO ABA’s Robb MacKie meets Maryland legislators.

ABA ROI 2012-2013 15


ABA ASSISTS BAKERS WITH ENERGY SOLUTIONS “ABA helps us learn about new ideas and different technologies that are out there. ABA’s Environment and Energy Committee does a great job of sharing best practices, so we are happy to take advantage of all ABA offers.”

— Anthony Turano, Dir. of Administration, Turano Baking Company

ABA DEVELOPS ENERGY STAR® GUIDE AVAILABLE FOR PLANT AND ENERGY MANAGERS Earlier this year, ABA developed the first ENERGY STAR® tool for commercial bakeries, the “Energy Efficiency Improvement and Cost Savings Opportunities for the Baking Industry — An ENERGY STAR® Guide for Plant and Energy Managers.” This guide is designed to help the commercial baking industry reduce energy and water consumption in a cost-effective manner while maintaining the quality of its manufactured products. ABA continues to develop new resources to assist and educate bakers in their mission to reduce energy.

“ABA not only coordinated with EPA to set up the partnership, but it they also gave us the tools we needed for improvement. The energy guide is a perfect example of the many tools now available to bakers. Both ABA and EPA should be commended on their efforts.”

— J.K. Evicks, Environmental Environmental Manager, The BAMA Companies

ABA RECOGNIZES BAKERS TAKING THE ENERGY STAR CHALLENGE

16 A Look at Your Return on Investment


INTERNATIONAL BAKING INDUSTRY EXPOSITION

• • • •

800+ Leading Manufacturers and Suppliers Industry’s Newest Advances Leading-Edge Education Unmatched Networking

IBIE is the industry’ gathering place — backed by the American Bakers Association, BEMA and the Retail Bakers of America, and attended by professionals from every industry segment who meet here to find high-quality products, machinery and ingredients, to learn from each other and to tap into the many business and educational opportunities available.Visit www.IBIE2013.com for more information and to register.

DID YOU KNOW? •

IBIE started in 1920 to provide a forum to connect bakers with suppliers to further the good of the industry. •

Proceeds from the show are invested back into the baking industry. •

IBIE is jointly owned by the American Bakers Association (ABA) and BEMA. •

IBIE is one of the top trade shows in the U.S.!

Food Defense Awareness Workshop

ABA is partnering with FDA to present a Food Defense Plan Builder seminar at IBIE that will provide important information on future requirements for company food defense plans. Registration information coming soon!


EXECUTIVE LEADERSHIP DEVELOPMENT COMMITTEE (ELDC) DEVELOPING FUTURE INDUSTRY LEADERS THE ABA ELDC IS DEDICATED TO DEVELOPING THE FUTURE LEADERS OF THE BAKING INDUSTRY AND THE AMERICAN BAKERS ASSOCIATION.

ELDC encourages ABA members to actively participate in public policy discussions and educates them on the role of ABA and its activities. ELDC also fosters personal leadership and management skills. Last fall, ELDC hosted a Public Policy Forum in Washington, D.C. The program agenda included congressional speakers, lobbying visits on Capitol Hill, an industry trends analysis and conflict resolution training. ELDC is chaired by by Connie Vaughan, McKee Foods Corporation, and Pete Frederick, Milner Milling Co./PFM. This October, during the International Baking Industry Exposition (IBIE), ELDC will host an Industry Leadership Panel featuring key leaders from the baking and allied industries. Panelists will discuss core strengths needed by effective leaders; the importance of peer groups like ELDC to foster young executives; the value of involvement in ABA to achieve industry success and build valuable networks; and provide seasoned insight on the outlook of the baking industry’s future.

18 A Look at Your Return on Investment


ABA MEETINGS — CONNECTING THE BAKING INDUSTRY

NETWORKING FACE TIME CONSENSUS BUILDING IDEA SHARING LEARNING OPPORTUNITIES RENOWN SPEAKERS

ABA CONVENTION PANELS GIVE INSIGHT ON CONSUMERS AND BAKING CATEGORY

ABA ROI 2012-2013

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ABA BOARD OF DIRECTORS 2012-2013 CHAIRMAN OF THE BOARD * Howard R. “Robin” Alton III President & CEO Pan-O-Gold Baking Company FIRST VICE CHAIRMAN * Fred Penny, President Bimbo Bakeries USA SECOND VICE CHAIRMAN * Richard Scalise, CEO Hearthside Food Solutions TREASURER * Albert Lepage Flowers Foods

Brian LeComte, Treasurer Gold Medal Bakery

Joseph M. Turano, President Turano Baking Company

R. Jack Lewis, Jr., President & CEO Lewis Bakeries, Inc.

* Robb MacKie ABA President & CEO

Larry Marcucci, President Alpha Baking Company

* Lee Sanders ABA Corporate Secretary

Paula Marshall, CEO/President The Bama Companies, Inc.

ALLIED AT LARGE REPRESENTATIVE J. Bowman Williams Jr., President B.C. Williams Bakery Service

James A. Martin, President Martin’s Famous Pastry Shoppe, Inc. Kevin McDonough, President Interbake Foods

IMMEDIATE PAST CHAIRMAN * Allen L. Shiver, President & CEO Flowers Foods

Mike McKee, President & CEO McKee Foods Corporation

Irene Chang-Britt, President Pepperidge Farm, Inc.

Barry McLean, President Canada Bread Company Limited

Marc Albers, President & COO United States Bakery

William Paterakis, President & CEO Northeast Foods

John C. Campbell II,Vice President Chattanooga Bakery, Inc.

Kevin Phillips,VP, Operations Support Safeway, Inc., Manufacturing Division

John Hink,Vice President Quality Bakery/Rite-Way

Erin Sharp.VP of Mfg. & Corporate Brands Sourcing and Planning The Kroger Co.

AIB CHAIRMAN David Murphy, President Mother Murphy’s Laboratories, Inc. ATBI PRESIDENT Richard McGrath, Senior Vice President Lockton Companies, Inc. BEMA REPRESENTATIVE Ken Newsome, President AMF Bakery Systems ABA GENERAL COUNSEL James Hamilton, Esq., Partner Bingham McCutchen LLP

*Indicates Executive Committee Member

ABA PROFESSIONAL STAFF Robb MacKie President & CEO

Kelly Knowles Senior Director, Political Affairs

Mike Goscinski Executive Assistant to the SVP, Government Relations & Public Affairs

Kelly Kotche Director, Membership & Marketing, & IBIE Registration Manager

Teresa Grant Director of Finance Matt Grogg Director, Meetings & Education & IBIE Housing & Transportation Manager Maggie Hummel Executive Assistant to the President & CEO

Cory Martin Director of Government Relations

Lee Sanders, CAE Senior Vice President, Government Relations & Public Affairs/Corporate Secretary Rasma Zvaners Policy Director

Samanatha Moore Meetings & Membership Coordinator Helen Nelson Receptionist, Administrative Assistant, and Notary Public

www.americanbakers.org • www.RiseToAction.org • www.BakersEnrich.org • twitter@AmericanBakers

American Bakers Association 1300 I Street, NW, Suite 700 W Washington, DC 20005 202-789-0300 • 202-898-1164 info@americanbakers.org

American bakers roi report 2013