Wenner Bread Products Inc.

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Wenner Bread Products Inc.

33 Rajon Road
Bayport, New York 11705-1101
U.S.A.
Telephone: (631) 563-6262
Toll Free: (800) 869-6262
Fax: (631) 563-6546
Web site: http://www.wenner-bread.com

Private Company
Incorporated: 1975 as Wenner Bread Products Inc
Employees: 489
Sales: $74 million (2005)
NAIC: 311812 Commercial Bakeries; 311822 Flour Mixes and Dough Manufacturing from Purchased Flour

The commercial bakery Wenner Bread Products Inc. ranked as the tenth most-used commercial bakery by retail bakeries, according to a 2002 report published by Milling & Baking News. The company sold dough that was shipped frozen and later cooked at retail bakeries. It also made partially baked (par-baked) and baked bread that was shaped, frozen, and shipped. What began as a small New York bakery had skyrocketed into a nearly 500,000 square-foot network of manufacturing and warehousing facilities by 2006. Wenner Bread capitalized on a trend during the 1990s that saw many retail bakeries, especially in-store supermarket bakeries, search for cost-effective ways to supplement a nationwide shortage of trained bakers. One solution was to order frozen dough or par-baked breads from commercial bakeries like Wenner Bread. The exchange allowed bakeries to sell the same fresh-baked products without needing onsite bakers. The five sons of the company's founders would later oversee Wenner Bread, which provided nearly 500 jobs for Long Island residents. Wenner Bread prided themselves as a high-quality commercial bakery and as the largest independent frozen-dough company in Long Island. Wenner Bread won several awards for safety. It also contracted the California-based technology business Graviton, Inc., to develop a wireless sensory network that provided Wenner Bread with a state-of-the-art self-monitoring production line. In 2005 Wenner Bread produced more than 500 varieties of breads and rolls for an estimated 20,000 retail bakeries, in-store supermarket bakeries, and food services.

1956–1980: RISE OF WENNER BREAD

In 1956 William, Sr., and his wife Mary Jane Wenner opened what would be the first of many Wenner-operated Long Island bakeries. Located in the town of Roosevelt, the shop called Wesley's was started with $2,000; it retailed breads, rolls, and pastries. The store's fast-growing sales prompted William Wenner, Sr., and his wife to open a second bakery in West Islip. On the Wenner Bread website, Wenner, Sr., attributed his business's success to producing "the freshest, highest quality breads and rolls that we could, day after day." Third and fourth retail bakeries soon followed.

The Wenner family began looking for ways to expand into the commercial bakery business. If dough was mixed and frozen at one location, it could still be thawed, formed, baked, and sold as fresh bread at another. Wenner Bread opened its first commercial bakery at a 2,500 square-foot warehouse in Deer Park. Before supermarkets were built with in-store bakeries, Wenner Bread sold to food service and retail bakeries that were hoping to reduce labor costs and the amount of space and time needed to prepare dough from scratch. Mary Jane and William Wenner, Sr., were joined by their five sons and the family ended its tenure as a retail bakery. Wenner Bread incorporated in 1975. Two years later Wenner Bread released a successful line of egg twist rolls and frozen challah dough. The latter was ceremonial bread served at Jewish holidays excluding Passover.

1980S: HEALTHY BREADS

Packaged bread that was sold in supermarkets had been a relatively predictable food item until the 1980s. Supermarkets were noticing that the sales growth of healthier breads, such as whole-grain bread and oat bran bread, was outpacing their less-healthy breads such as rye bread and white bread. In the 1980s pricing also became more competitive between the companies supplying commercial bread racks.

One common misconception about bread was that it was fattening. In the 1980s more consumers were realizing that the fat actually came from the spreads used on bread. Bread was increasingly recognized as an excellent source of complex carbohydrates, vitamins, minerals, and fiber. Supermarkets noticed that their customers were reading more nutritional labels on the packaging. Even though in-store bakeries had not yet been popularized inside supermarkets, consumers were seeking higher quality breads. The trend would affect Wenner Bread in the following decade. Between 1984 and 1989 the consumption of whole-grain breads doubled. "The category has increased 25 percent over three years. Consumers are more educated in diet and nutrition than they were before," Gregg Dorner, the director of merchandising at Heinemann's Bakeries, said in a February 6, 1989 issue of the trade publication Supermarket News. "The growth of the whole-grain bread category really depends on the area. In the more affluent neighborhoods, the whole-grain breads [are growing even faster,]" Dorner said.

1990–1999: IN-STORE BAKERY BOOM

In the 1990s new supermarkets were being built with in-store bakeries, but the supply of skilled bakers had dwindled. Food service providers and other retailers began relying on the convenience and consistency of commercial bakeries like Wenner Bread. Using commercial bakeries was not just easier, it was sometimes less expensive. In 1993 Ralphs Grocery Co. closed a bakery that was providing bread for its Southern California supermarkets. The Ralphs Glendale-based bakery had become too expensive to operate. Executives tried reducing costs with the layoff of more than 100 employees at the start of 1993, but eventually the company's executives found a more affordable supply of fresh bread. "We tried to make this thing work, but consumers are demanding in-store manufacturing," Gene Brown, senior vice president for Ralphs human resources, said in a May 7, 1993 edition of the Los Angeles Daily News. "In addition, commercial bakeries can produce the products like bread and buns for less money," Brown concluded.

COMPANY PERSPECTIVES

Your complete satisfaction is our ultimate goal. We are committed to excellence in every facet of delivering superior bread products and support services. As the target for perfection continually moves, we respond by constantly improving our methods and processes. We are continually developing new products, based on consumer demand, your requirements or Wenner innovations. Wenner proudly provides much more than quality bread products, we offer a full range of support services, including planning, training, marketing and more. Wenner's expert staff assists in establishing in-store bakeries, including space planning and display design. Our experienced technicians will teach your employees the skills they need to become bakers in very little time. For our hospitality customers, Wenner helps plan menus, making our best product recommendations based on existing equipment and facilities. We also provide full marketing support, from packaging design to supplying reader friendly product brochures for your customers.

In the mid-1990s supermarkets were also improving the marketing for in-store bakeries. Full-page newspaper ads were dedicated to the fresh-baked bread being made inside supermarkets. In-store bakeries slowly understood that consumers would pay higher prices as long as the bread was fresh and made from high-quality ingredients. It was estimated that retail bakeries increased their reliance on commercial bakeries from 62 percent in 1994 to 65 percent in 1995. Bread supplied by Wenner Bread and other commercial bakeries was typically branded by the supermarket. "We want the store to have the brand. We think it's vital for in-store bakeries to maintain their own identity and not be someone else's bakery," Richard Wenner, the president and chief executive officer of Wenner Bread, said in Milling & Baking News. "When you take a brand into your own bakery, you lose control over your own profitability," William Wenner's son continued; "You're becoming an extension of the commercial aisle by using off-premise labels, and you're eliminating your image of freshness."

The freshest method of supplying retail bakeries was to ship frozen dough that could later be baked. Shipping par-baked bread was the second-freshest way to transfer bread from commercial bakeries to retail bakeries. Some retailers purchased already-baked frozen bread which they would then defrost and sell. Bob Wallace, president and chief executive officer of BakeMark Ingredients [East], Inc., said in Milling & Baking News, "There's a continuum where [retail bakeries] move from scratch, to mix, to frozen dough to thaw-and-sell, and different chains and different customer segments are always at different points on that continuum," he said. "The continuum generally moves toward more convenience, meaning less labor required."

According to Gale Group Inc., the sale of bread products for Wenner Bread reached $59 million in 1999. The commercial bakery industry was expanding from a niche to a mainstream market. Retail bakeries were ordering frozen dough or par-baked breads and then finishing the product with their signature ingredients or shape just before baking.

2000–2002: ARTISAN BREADS

Artisan-style breads enjoyed a rise in popularity at the start of the new millennium. These breads were made with thick crusts that usually surrounded dense interiors of bread, fruits, nutmeats, and honey. The style originated in Europe where artisan bread had been handmade for centuries. It typically featured a high price tag and was initially considered a luxury item. Wenner Bread offered more than 25 varieties of artisan dough in 2002. Even though the U.S. economy dipped after 2000, Americans' desire for high-end bread was increasing. In 2002 consumers purchased $75 million to $150 million of artisan bread in the United States. Sales were growing 20 percent annually. It was estimated that in the mid-1990s only 10 percent of supermarkets carried artisan breads, but by 2002 the percentage had climbed to 40 percent. "People now talk about a loaf of bread like a bottle of wine," said Frank French, director of technical services for ADM Milling Co., in Milling & Baking News. He continued: "People are tearing bread apart. I'm amazed at how many people love to do that."

Industry analysts feared that commercial bakeries would warp the traditional handmade process of artisan bread. Wenner Bread and its competition were aware, however, that consumers would only pay a premium price for the product if it was made with fresh and premium products. Many commercial bakeries still made the dough by hand. "Artisan bread is meant to be baked and sold. It's not meant to be baked, frozen, sold, and distributed across the country and baked again," Wenner said in Milling & Baking News.

2002–2003: FACILITY IMPROVEMENTS

While most commercial bakers believed that the flourishing economy and lack of skilled bakers had increased their business, Tim Busta, the product manager at Dawn Food Products, Inc., offered a different theory. In Milling & Baking News, Mr. Busta explained in 2002, "The reason the frozen dough market is growing so well is the fact that the quality level has risen from 10 to 20 years ago," he said. "Better technology, ingredients and machinery available today drive down the cost so bakers can have frozen dough without paying a ton to have someone pre-form something for them, and improved ingredient technology has made frozen dough products better."

KEY DATES

1956:: William and Mary Jane Wenner open Wesley's pastry store in Long Island with $2,000.
1975:: The company incorporates as Wenner Bread Products Inc.
1978:: The company introduces the first frozen dough challahs and egg twist rolls.
1999:: Sales reach $59 million.
2003:: Graviton technology is installed in Wenner Breads production line.
2004:: Sales reach $71.5 million.

Wenner Bread's high-tech facility exemplified Mr. Busta's statement. In 2003 Wenner Bread signed a contract with Graviton, Inc., a California-based developer of wireless networks. Graviton installed a state-of-the-art sensory system across Wenner Bread's production line. Monitors were placed throughout warehouses to insure optimal temperature and dough quality. Temperature monitors were also installed inside freezers, refrigerators, and delivery trucks. All of the information was sent wirelessly to a control center, which also alerted factory workers about routine maintenance needed on equipment. To reduce wasted electricity, Graviton installed wireless power meters throughout the production line. "Wenner Bread Products has a proud history of innovation, safety and relentless dedication to quality," Richard Wenner was quoted by PR Newswire. "Consistent with that tradition, we are pleased to be working with Graviton to implement this breakthrough technology in our state-of-the-art manufacturing operations."

Wenner Bread's product quality and workplace environment scored well with industry groups. The company earned a superior rating from the American Institute of Baking. The Occupational Health and Safety Administration (OSHA) awarded Wenner Bread with Star Status and titled the company "America's Safest Bakery." Wenner Bread's Long Island facilities allowed the company to produce some 1,200 bread varieties by 2003. In restaurants, where fresh baked bread was not as important as other items on the menu, Wenner Bread provided frozen hamburger buns, breadbasket rolls, Kaiser rolls, and other bread products.

The competition was also improving their manufacturing process. In 2004 a system that provided real-time feedback on the quality of bread products was installed at a Flowers Bakery plant. Flowers Bakery, owned by Flowers Foods, Inc., was one of the nation's largest commercial food companies serving retail bakeries and fast food chains. The system was co-created by Georgia Tech Research Institute, the conveyor systems manufacturer Baking Technology Systems, Inc. (Bake-Tech), the software company Thinkage Ltd., and the manufacturing technology firm Rockwell Automation, Inc. Cameras mounted in the production facilities fed video to computers that inspected the bread for impurities, seed consistency, and proper form. The supervisory system was designed to inspect between 600 and 1,000 buns per minute.

Safety was also a top priority for Wenner Bread. OSHA had reported a reduction in workplace fatalities across America's general population in 2003, but the fatalities for Latino day laborers had increased. OSHA representatives explained that because many Latino day laborers spoke little or no English, they could not fully understand onsite safety instructions. In 2003 OSHA teamed up with Wenner Bread for the OSHA Voluntary Protection Program. The majority of Wenner Bread's employees were non-English speaking. The program required Wenner Bread to provide safety and health information in their employees' native tongues. Wenner Bread was the first business in the New York area to participate in such a program. One 10-hour Spanish safety course covered proper use of equipment, health hazards in the Wenner Breads factory, and fall protection. Wenner Bread also provided the employees with protective equipment and food throughout the course.

2003 ONWARD

In 2003 Wenner Bread was operating in 150,000 square feet of several different office, production, and warehouse locations. In June the company leased 72,000 more square feet of warehouse and office space in Ronkonkoma, Long Island. The expansion secured Wenner Bread's position as the largest commercial baker on Long Island. Wenner Bread also employed between 400 and 500 employees and sold bread to 20,000 retail locations. "Long Island has a bigger food industry than most people realize," Jeremiah Schnee, a managing partner at the business advisory firm Biscotti, Toback/RFR & Co., was quoted by Long Island Business News. He continued, "Food may not be sexy the way high-tech is, but it's a stable industry. Everybody has to eat. It's much more stable and consistent (than tech), while being unsung."

Wenner Bread's sales were estimated by the Gale Group to be $71.4 million in 2004, a substantial increase from the $59 million posted in 1999. In 2005 the U.S. bakery industry had an estimated 2,600 commercial bakeries that were collectively generating $25 billion in sales. The next year Wenner Bread employed 600 workers and was hoping to consolidate its operations, which was spread across 500,000 square feet of production and warehousing facilities. The company was also hoping to reduce transportation costs by adding production facilities closer to their suppliers in the Midwest.

PRINCIPAL COMPETITORS

Bakemark USA LLC; Dawn Food Products, Inc.; Flowers Foods, Inc.; General Mills, Inc.; Interstate Bakeries Corporation; Kraft Foods Inc.; Sara Lee Food & Beverage; Unilever.