Editor Heather Henstock (left) presented Modern Baking's 2006 Retail Bakery of the Year award to Kirk Rossberg's Torrance Bakery.
Bear claws are filled and shaped by hand like most of the bakery's products due to limited production space in its Torrance location.
Decorated cakes make up 36% of Torrance Bakery's sales. The department clocks in 83 hours a day among 15 employees.
Rossberg meets weekly with his production staff to prepare for the week ahead.
Self-help gurus profess that the key to success and happiness is communicating with those around you. Torrance Bakery is proof that communication is key to a successful and happy business as well. After Owner Kirk Rossberg opened a two-way dialogue with employees and gave managers a stake in the business, revenues have increased every month and the bakery is experiencing its largest profits since he purchased the bakery in 1984. Successful management practices are among the reasons why Torrance Bakery was named Modern Baking's 2006 Retail Bakery of the Year.
Rossberg, a first generation baker, discovered what he wanted to do early in life. After working for a Swiss candy maker in his neighborhood, he was convinced he wanted to own candy shops. The candy shop whet his appetite for the retail food business, but his next position working for a baker changed his life's ambition. "Now, I wanted to own a bakery," Rossberg laughs.
To gain as much experience as possible, he worked for five other bakeries in the Los Angeles area before purchasing his own shop. "It was a great experience, almost like going to school. I learned how to do things, and I saw how not to do some things as well," he says.
In 1984, a bakery in downtown Torrance, Calif. became available. The business was essentially a donut shop that sold a few other products, but Rossberg transformed it into a full-line retail bakery. In the beginning, the bakery had eight employees in one location. It has grown to 74 employees and three stores. During the past 22 years, Rossberg developed a management structure that could grow with the bakery.
Communicating with employees from all departments has become the key to the bakery's success. Rossberg-began "talking" to his staff through employee newsletters. "But if you don't say it, they don't 'hear' it," he says.
A more effective method proved to be weekly meetings with both the production staff and the eight bakery and department managers.
The production meeting, held Wednesdays at 9:30 a.m. as one shift is leaving and the next arriving, covers safety issues, problems that may have occurred in the past week, the plan of attack for the coming week and what equipment or supplies they need. Rossberg conducts the meeting in Spanish, which he knows just well enough to butcher it, he says. Conducting the meetings in Spanish encourages staff to feel more comfortable to speak up, creating a two-way dialogue.
During the managers meeting, Rossberg and his eight managers, dubbed the "Inner Circle of Trust," discuss issues outside of production, including new promotions, sales goals and growth plans. "It's taken 20 years to realize this, but eight or nine heads are better than one any day of the week," he says. "Then, when you add the bakers meeting, you have another 20 plus people giving their ideas."
In order for the managers and bakers to be able to contribute, they have to fully understand the business of the bakery. "We go over financial's almost every week with managers. We tell the bakers how we are doing and where we are at."
Sharing profits with managers
To improve sales in January, a notoriously slow month for retail bakeries, Rossberg previously had tried several cost-cutting methods, such as implementing mandatory vacations and cutting back on employee hours. This January, he decided on a different approach. He told his mangers that he would give them 20 percent of the profits for that month. "I'm thinking to myself that 20 percent of zero is zero, so what can it hurt? And, if it works, I'll gladly share," Rossberg says. "We had the best January ever."
He has continued the profit sharing, and the profits have increased every month. This past August had better sales than the previous December, so Rossberg is expecting big things for the coming December, he says. "Even giving up the 20 percent, the bottom line is higher than it's ever been," Rossberg adds. "I try to think what else it could be, but it goes back to giving them [employees] a little bit of ownership."
The sharing of information, not just profits, is what gives them ownership, he notes. Knowing a common goal helps employees work together, and knowing where the bakery stands financially helps them make more informed decisions. They may think they need some additional piece of equipment, but when they are fully informed, they may decide they don't need it yet, Rossberg says. Or, they may decide that it will make them even more efficient, and they need it right away, he adds.
"I'm not going to change now. It's been great to be able to let loose a little bit, let other people take on projects. It doesn't have to be my idea," Rossberg says. " Listening to other people's ideas has really made me value my staff."
His current management style grew out of necessity because the bakery was growing, he says. In 1995, Rossberg purchased his second location in a shopping mall in Torrance. The 3,000-sq.-ft. shop is equipped to be a fully operational bakery, but when the bakery tried baking out of both stores, it experienced consistency problems. So, all of the bakery's production is currently housed at the original, 5,200-sq.-ft. downtown store. The mall location only bakes off cookies. This fall, the bakery grew again with the addition of a third bakery in nearby Gardena. Most of the building's 6,000 sq. ft. is devoted to production, with only a small retail store. It is fully equipped with three mixers, two ovens, a proofer, a sheeter, a walk-in freezer and showcases, and Rossberg plans to move most of the bakery's production for all locations to the new facility. A small crew will remain at the original store, but the Gardena building offers a better production flow and will allow the bakery to continue to grow.
Aside from providing much needed space, Gardena, located just north of Torrance, also proved ideal for another location.
"We found that a lot of our customers come from the north of us," Rossberg says. "It [the Gardena bakery] might attract more customers and more corporate businesses because we might hit more of downtown L.A."
Rossberg also hopes the Gardena store will alleviate some of the stress at the other two locations. The downtown store has 700 to 800 customers daily while the mall store serves between 200 to 300.
Most of those customers know Torrance Bakery because of its cakes. "Wedding and decorated cakes are really our strong focus," Rossberg says.
About 60 percent of the bakery's sales are from cakes, with 36 percent being decorated cakes. While production is not heavily automated, the bakery has invested in computer decorating equipment. Almost 30 percent of the decorated cakes are computer-generated image cakes. Wedding cakes account for 18 percent and tortes the additional six percent.
In the summer, Torrance averages 50 to 70 wedding cakes every weekend. To deliver them, the bakery uses the three vans it owns and rents seven others. "It's easier to rent for a day, so we don't have the upkeep," Rossberg says.
With wedding cakes making up a large portion of the bakery's sales, Rossberg dedicated one storefront of the downtown location as a wedding cake display room. The room has a separate entrance from the bakery, which allows the consultations to take place in a quiet environment, and the separate room allows several cakes to be displayed.
Rossberg also upgraded several design elements of the room, such as tile flooring, to give the room a classier feel. "We take this higher end cake really seriously. We want to make the experience a little bit special," he says.
With the majority of sales coming from cakes, Rossberg admits that if he had to do it over again, he would make Torrance Bakery more of a specialty shop instead of a full-line bakery.
"What do we do best? We do cakes and sweet-goods best," he says. While the bakery still offers a full product range, including donuts and breads, Rossberg is shifting the rotation of items in the showcases to give more emphasis to the more profitable and popular products.
For example, Rossberg has cut back on donut production to increase cookie sales. Previously, the bakery filled a showcase with donuts, and once they sold out, cookies replaced them.
However, if it was a particularly slow donut day, the cookies never made it into the showcase. "The cookies are more profitable, so how stupid was that? I learned," he adds.
Torrance also remains focused on remaining a retail bakery. "We get a lot of people who ask us to wholesale to them, but we stay away from the 'W' word," Rossberg says. Instead, the bakery deals with almost 400 "corporate" accounts, but does not offer them a price break. The majority of the accounts are caterers or local corporations. To make up for not offering lower prices, Rossberg occasionally will eliminate the delivery fee, but not often.
"It has to be a win-win situation," he says. "It seems to work well for caterers who ask for a set amount, but not sandwich shops that will have stales."
To keep the retail customers returning, Rossberg is continually fine-tuning his product line. "I do think that the products have to be evolving. You can't be too complacent," he says.
He used to think that certain products, such as his chocolate cake formula, couldn't be tampered with. "I think that you have to constantly evolve and constantly get better. We actually have changed our chocolate and white cake. We are striving for even higher levels of excellence," he says.
To help inspire his staff, he sends them on "field trips" to other bakeries. Rossberg has always taken field trips, but now has opened it up to his managers and sales staff. They go incognito to get a true sense of the bakery and have an allowance to spend. When they come back, they share the products and other information with Rossberg and their fellow employees.
"Allowing them to do it is letting them be a part of the whole process. By them going to other bakeries, they get a sense of what's good and what's bad about our bakery and what we may need to work on," Rossberg says.
They may come back with ideas for improvement, or they may see something that they would never want to see in Torrance Bakery, he notes. Either way, it is a win, he adds.
"It gives them a sense of pride in our bakery," Rossberg notes.
...a sampling of prices
Apple pie, 9 ins.: $7.60
...at a glance
Location: Torrance, Calif.