Marc Serrao, who started from scratch as a donut shop cleaner, has built his retail bakery into an almost $5 million operation. He is handing the reins to the second generation with the goal of being a Pittsburgh destination well in hand.
When people hear “Pittsburgh,” many may think of steel mills, Heinz ketchup or the Steelers football team. Marc and Susan Serrao want to add Oakmont Bakery to that list. The bakery is located in Oakmont, Pa., a small enclave 14 miles northeast of Pittsburgh. The town may be best known as the home of the Oakmont Country Club, which has played host to several professional golf tournaments. However, Oakmont Bakery is gaining prominence. The former borough manager told Serrao that when she goes to meetings and people find out she is from Oakmont, they often comment on their experiences with the bakery.
“That's one of the best compliments I've ever received since she represented Oakmont for more than 50 years,” Serrao says. It appears he is succeeding in making Oakmont Bakery a Pittsburgh icon.
He started his baking career at 15 as part of the cleaning crew at the Donut Shack, and by 18, he was managing the shop. After graduating from high school, Serrao worked in several supermarket in-store bakeries.
In 1988, he and wife Susan purchased a bakery located in Oakmont's central business district. The bakery had only been open 10 days when the owner suddenly died, and it featured brand-new equipment and stained glass fixtures.
“It was perfect, and something I would never been able to afford myself without the help of the previous owner's estate's financing,” Serrao says. Although he was starting a mom-and-pop bakery, even then he envisioned something much bigger.
In the beginning, he wholesaled product to the in-store bakery where he had previously worked, but after a few months he found he was focusing on the wholesale orders and not the retail shop. He credits it with keeping the business going in the first few months, but his passion was retail. “So, I made a decision that we would do no wholesale at all. I think that was the best decision for the bakery,” he adds. “I believe wholesale is wholesale and retail is retail. They are two separate businesses.”
Within five years of purchasing the bakery, he was out of space. Serrao moved the bakery to the center of town and into a 4,500-sq.-ft. car showroom that his father, a contractor, completely remodeled into a retail shop with production in the back. Five years after that, the auto shop across the parking lot became available, so Serrao moved the retail shop into that 4,500-sq.-ft. building and expanded the production space in the old building. The former retail space became a cake decorating room. Employees move product from the production building to the retail building in enclosed keeper carts.
But Oakmont's expansion was not complete. A few years ago, Serrao purchased the building behind the bakery and converted it into a 5,000-sq.-ft. warehouse, complete with loading dock and parking. Trucks go directly to the warehouse for deliveries, and the warehouse allows Serrao to buy in larger quantities for better pricing. He recently purchased an extra four pallets of sugar when he noticed prices rising. Each day, the maintenance crew drives needed ingredients to the production building in a golf cart.
The bakery is in production almost 24 hours a day. The first shift arrives at 10 p.m. to start the doughs, then a shift comes in at 4 a.m. to start finishing product to ensure products are ready for the bakery's 6 a.m. opening. Then, a baking shift arrives at 5 a.m. Serrao's son Tony runs production.
Serrao added a daytime baking shift about five years ago, which allows the staff to really focus on producing for that day. “It's the best idea we've ever had,” Serrao says. “Tony comes in at 8 o'clock and bakes with his crew all day, so people know when they come in they're getting fresh product. Often, afternoon customers leave with product that is still warm.”
He doesn't worry about staling and doesn't hesitate to bring in a fresh tray of product at 5 p.m., even though the bakery closes two hours later. “It used to be that you tried to make just enough that you'd sell out by the end of the day,” he says. “I realized when I first opened that people stopped coming in by 6 p.m. and we didn't close until 7 p.m. It was because my cases had almost nothing in them. Now we keep the cases full. My biggest pet peeve is empty cases.”
Some automation is necessary to keep up with the demand of baking all day, but Serrao is careful about how he chooses to automate. He will not purchase a machine that requires him to change his formulas. “If it just makes it faster and easier, we love it,” he says. The bakery uses a bagel machine, a die-cut cookie machine and a batter depositor, all of which work with current formulas. He purchased a cake icing machine last year but had to return it because he had to change the icing too drastically.
Freezing product also is necessary to keep up with demand, and sometimes to improve the finished product, Serrao says. The production building has 1,500 sq. ft. of freezer space and 1,000 sq. ft. of cooler space. The retail building also has a freezer and cooler. Donuts, pastries and breads are never frozen, but cakes and cookies always are. “I actually believe that freezing the cakes and cookies increases moisture,” he says.
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In the cake decorating room, up to 15 decorators can be working at one time, producing as many as 30 wedding cakes and 200 decorated cakes for Saturdays. Icers work from 8 p.m. to 4 a.m. to make sure all the cakes for a given day are ready when the first four decorators arrive at 5 a.m. — others come in at 9 a.m. Wedding cakes account for 5 percent of sales, and Serrao has seen a large increase in wedding cakes this year. “I think one of the reasons is that the shaped cakes go into the wedding cake category,” he says.
Oakmont offers a full line of products, with more than 1,200 items available that are produced from a combination of frozen dough, mixes and scratch. Bread and roll varieties are scratch from starters and some frozen dough; bagels are from scratch; cookies are scratch and cakes are mix. Each is made in separate areas of the facility to try to control heat and humidity.
The retail area features 10 showcases with more than 100 ft. of product on display and visible through a solid bank of windows on the front of the building. It is important that they always be clean and full of product. To keep the showcases looking their best, Oakmont employs merchandising specialists throughout the day — one comes in two hours before opening and one stays an hour past closing — to make sure the showcases are always full of product and to clean them as needed. They also are responsible for calling the production team when more product is needed.
Each showcase is dedicated to a certain product. All 27 varieties of regular donuts, 15 types of cinnamon rolls and fancy donuts and eight different donut hole flavors are in one case; the 18 varieties of bagels are in another. “I always envisioned my bakery set up like a row of specialty shops,” Serrao says. “We're most known for our seemingly never-ending displays.”
To keep those displays fresh, Serrao is always looking for new products. About 10 years ago, he introduced paczki, making just a few trays that first year, but they sold. The next year, he hyped them a little more by running radio commercials and selling paczki dolls. Now the bakery begins making them on Jan. 2, starting with 15 screens a day. (Each screen holds 2½ dozen paczki.) By the end of January, the bakery is making 25 screens a day. On Fat Tuesday, more than 2,100 paczki were sold (70 screens). Although the paczki season officially ends on Fat Tuesday, Oakmont sells the product until Easter. This year, customers bought 1,800, or 60 screens, of paczki on the Saturday before Easter.
Due to the product's popularity, Serrao designated the last weekend in July as Paczki Days. He ran 40 radio commercials for that weekend alone, and the bakery sold all 12 varieties of paczki. The bakery made 20 screens on Friday, 40 screens on Saturday and 25 screens on Sunday. “We sell them for $1.60, and we sold out every day,” Serrao says.
Another product Serrao introduced four years ago also is proving popular. The Attitude cupcake line features 12 varieties of filled cupcakes, all with funny names and bad attitudes. The Godfather is yellow cake filled with tiramisu cream, dunked in espresso and topped with more tiramisu cream and powdered cocoa. A ladyfinger adorns the top. The radio commercials feature distinctive voices for each flavor, and they often fight with each other.
“We went from selling maybe 500 cupcakes a week to 5,000 a week,” Serrao says.
Serrao's philosophy toward business is always to be learning and improving, and every year he sets new goals and areas for improvement. Three years ago, he wanted to reduce customers' wait times in the bakery. He started the Sweet Line, an idea he converted from the Fast Pass at Disney's theme parks. This line is for prepaid, pick-up orders only. It is set apart from the other lines because it doesn't have a cash register, and customers don't have to take a number. It has a sign that hangs above, and a retractable belt keeps it separate from other lines.
When introducing the Sweet Line, Oakmont ran several ads parodying the Where's Waldo books. The ads asked, “Where's Waldo?” with the answer, “He's in the Sweet Line, of course.” The gimmick continued in the store with the employee manning the line dressed as Waldo.
In 2008, Serrao added a full European coffee bar and updated the café area. He added leather-upholstered chairs and a fireplace. The sleek, modern look of the bakery was influenced by a trip to Florida. Serrao had stopped in a local restaurant for lunch and really liked its interior, which he used as inspiration in the bakery. After Serrao installed the coffee bar, coffee sales increased by 47 percent; it currently accounts for 1 percent of total sales.
Last year, he decided to focus on making Oakmont Bakery not just a community bakery but also a Pittsburgh destination. He is getting some help from the airport. From October this year to October 2011, the airport will run short commercials on seven area businesses, with Oakmont Bakery being one of them.
Oakmont does plenty of advertising on its own. “We do a lot of radio ads because they work so well for us,” Serrao says. For holidays and special events, he will run as many as 40 commercials during a weekend. The commercials seem to run constantly with listeners continually hearing “oakmontbakery.com.”
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“At first, I was like ‘how much can I fit into a minute, but now the commercials are very focused on one thing,’” he says.
The bakery's on-air tagline came from a radio personality with a very distinctive voice. After an Oakmont commercial aired, he candidly added, “Mmm, mmm, Oakmont Bakery.” Serrao loved it and has it dubbed into the beginning of every commercial.
Oakmont also advertises in its own store. The wall behind the retail counter features three 60-in. LCD screens with rotating PowerPoint ads promoting the bakery or displaying fun trivia. It gives the customers something to look at while they wait for their number to be called. At Christmas, the screens feature a set of It's a Wonderful Life trivia questions, and customers often yell out the answers, Serrao says.
The idea for the screens came from a visit to Alcatraz. The small café on the island had a digital menu board, and Serrao liked the idea of being able to change it frequently. Previously, Serrao had to change the whole board when he wanted to alter one small detail. “We have a lot of fun with the screens, and it's great advertising. We can change them every day if we want,” he adds.
After more than 20 years of running the bakery, Serrao is beginning the transition to the second generation, and two of his five children currently work in the bakery full time. The younger three are still in school, and their future in the bakery is yet to be determined. The Serraos have always stressed education with their children and insist they all attend school before coming to work in the bakery full time.
As a child, Serrao's son Tony had always expressed an interest in the bakery, and after several years of hounding, Serrao finally put him to work at age 12 with the agreement that Tony would work with the maintenance staff for five years.
“I felt it was very important that I had started at the bottom and that I had understood what every position was for, so I did the same thing with Tony,” Serrao says. “I felt it was important that he know how it felt to be the cleaning guy and how important that job is.”
After five years, Tony moved into production after attending AIB International to become a certified baker. He worked under the production manager for two years before moving into that position in January.
Serrao's daughter Stephanie attended the University of Pittsburgh and earned a degree in business and marketing. She now manages the office and assists with advertising, sales tracking and marketing.
The second generation of the Serrao family is taking the reins of a very successful business. Oakmont Bakery had sales of $4.8 million in 2009 and 2010 is currently tracking six percent higher.
“The idea of doing $60,000 or $70,000 in one day wasn't even a thought when we first started,” Serrao says. “And this past Christmas Eve when my wife told me we exceeded $67,000, I chuckled and said, ‘Yeah, I can feel every penny of it.’”
Like many bakers, Serrao never really sees himself retiring, but it sounds like maybe the second generation is coming along just in time.
Location: Oakmont, Pa.
Founded: 1988
Bakery's primary business: 100% retail
Website: www.oakmontbakery.com
Store size(s): 4,500 sq. ft., retail; 4,500 sq. ft., production facility; 5,000 sq. ft., warehouse
Market served: greater Pittsburgh area
Product line: full line of breads, rolls, donuts, pastries, cakes, bar cakes, cupcakes, cookies, muffins, Danish, chocolates, sandwiches and coffee
Product breakdown: wedding cakes, 5%; coffee, 1%; table products, 4%; sandwiches, 2%; custom cakes, 16%; cupcakes, 6%; pastries, 8%; mini pastries, 3%; breads and rolls, 7%; dessert cakes, 17%; cookies, 17%; donuts, 7%; other products, 7%
Annual sales: $4.8 million
Management: Marc and Susan Serrao, owners; Tony Serrao, general manager; Michael Sullivan, retail manager; Debbie Lambing and Cathy Cornwell, cake supervisors; Michael Bouch, night manager; Stephanie Serrao Bittinger, office manager and marketing director; Courtney Daniels, IT and wedding cake coordinator
Number of employees: 107; 70% full time
Production method: combination of mix, scratch and frozen
Major equipment: mixers, sheeter, batter depositor, fondant sheeter, bagel divider, bagel boiler, donut fryer, two rack ovens, one deck oven
Bakery supply distributors: BakeMark, Stover & Co., Zilka & Co.
| French bread | $2.90 | |
| Asiago bread | $3.90 | |
| Baguette | $2.40 | |
| Cinnamon crunch bagel, each | $0.70 dozen | $7.20 |
| Breakfast bagel | $4.00 | |
| Chocolate chip cookies, each | $0.55 dozen | $5.50 |
| Cannoli | $1.20 | |
| Macaron | $1.00 | |
| Glazed donuts, each | $0.70 dozen | $7.20 |
| Donut holes, dozen | $2.00 | |
| Cinnamon rolls | $1.50 | |
| Apple coffee cake | $4.25 | |
| Chocolate pudding cake | $6.50 | |
| Blueberry pie, 8 ins. | $6.50 | |
| Banana cream pie, 9 ins. | $7.50 | |
| Danish | $0.75 | |
| Brownies, each | $1.00 dozen | $10.00 |
| Attitude cupcakes, each | $2.50 dozen | $25.00 |
Don't miss your chance to speak with Marc Serrao and members of his family. Go to Modern Baking's booth 5618 at IBIE on Monday, Sept. 27, at 2 p.m. to meet the Serraos.
FOR MORE PHOTOS and information from Oakmont Bakery, go to here.