How Berkshire Mountain Bakery manages growth

Bigger wasn’t better for this Housatonic, Mass. specialty wholesale bakery. Owner Richard Bourdon reorganized his staff and revised his production schedule; today, with more than $1 million in sales, the bakery is profitable.


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Path to baking
The journey into baking for the Quebec-born Bourdon was a fluke of fate. As a 22-year-old music student at The Hague Conservatory of Music, he decided to forego his French horn and focus on his fascination with food. Not certain what kind of culinary career he should pursue, Bourdon placed an ad in the newspaper seeking work with either a farmer or a baker. The baker replied first.

He worked in bakeries across Europe, learning the business from bench to management. For six years prior to coming to the United States, he ran a bakery in Amsterdam. Once in the U.S., Bourdon baked bread at night in the kitchen at a macrobiotic institute, selling about 200 loaves per week.

A $20,000 loan from one of the institute's clients allowed Bourdon to establish his own bakery in Housatonic in 1987. The 900-sq.-ft. facility was equipped with a four-deck oven bought at an auction, a rebuilt mixer and a single burner. In addition to bread, Bourdon's Berkshire Mountain Bakery offered cakes, pies and other sweets.

To keep up with the growing demand, Bourdon took out a second loan to pay off his original debt, and he moved into a 7,000-sq.-ft. brick warehouse. By 1988, Bourdon was baking 8,000 loaves per week and averaging $1 million in revenues.

However, an increase in production actually led to a decrease in profits. By 1992, Berkshire Mountain Bakery was producing 12,000 loaves per week, but was losing money due to debt payments, rent and payroll. A combination of a national recession and more competition in the marketplace also caught up with the bakery, contributing to its financial woes.

Downsizing for growth
Bourdon pared down his staff from 22 to three and revised his production schedule. He deliberately kept his operation small (averaging $500,000 to $600,000 in annual revenues) through 2001 to allow him to keep overhead costs at bay and pay off his loan. He also purchased the bakery building.

To control costs, Bourdon stopped guaranteeing sales. “Because we no longer took back stales, our wholesale customers ordered less, but more carefully,” he notes. The moves paid off with the bakery reaching $1 million in sales and more importantly, remaining profitable. His staff size is up to 13 full-time employees, including seven bakers, and two part-time employees.

While Bourdon wants to expand, he is carefully controlling growth to avoid turning the bakery into a factory. He also is slowly growing his retail business. Because the Berkshire Mountain area is a summer vacation destination, retail sales are mostly seasonal and can triple during peak times, Bourdon says.

He is banking on a new line of cookies to help boost his bakery's retail sales. Introduced last February, the cookies are made from sprouted whole grain spelt flour, sucanat (dehydrated sugar cane juice) and trans fat-free palm fruit shortening.

“Sprouting grain changes its composition from a starch to a vegetable, converting it into living food, so that more of its vital nutrients can be absorbed by the body,” Bourdon explains.

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