Specialty wholesale bakeries, those smaller wholesalers who pursue tightly defined marketing niches, commonly evolve from the ranks of full-line retail bakeries. Occasionally, a specialty wholesaler pops up from another industry. Schwartz Brothers Bakery, Seattle, is one of those anomalies, having emerged from the foodservice sector to become a full-line supplier of bakery foods in metropolitan Seattle and throughout northwest Washington.

The bakery operation is the result of two of the more progressive forces on Seattle’s foodservice scene: brothers Bill and the late John Schwartz, founders of Schwartz Brothers Restaurants, and Gretchen Mathers, who created Gretchen’s of Course restaurants and catering.

The Schwartz brothers established their business in 1970 and have opened and operated several award winning, multi-concept restaurants and two foodservice operations in metropolitan Seattle.

Separately, in 1979 Mathers opened her restaurant and catering operations. Mathers merged her company with Schwartz Brothers Restaurants in 1987 and became the managing partner of Gretchen’s of Schwartz, which included the newly created Schwartz Brothers Bakery.

Initially, the bakery, located in the kitchen of a Schwartz Brothers restaurant, only supplied desserts to the company’s restaurants.
However, the bakery received a major boost in 1990, when it began supplying products to then-fledging Starbucks Co., now one of several large accounts.

The Gretchen’s of Schwartz division continued to expand with the acquisition of Nordstrom Catering and the creation of Gretchen’s Shoebox Express in 1996. In 1999, the company started Columbia River Bakery, a specialty wholesaler, in Vancouver, Wash., which serves the greater Vancouver and Portland/Eugene, Ore., markets.

David Walden, Schwartz Brothers' sales/customer service manager, discusses the bakery's retail products with West Seattle Thriftway's Chad Turnball.

The Seattle bakery’s business has grown to include 120 accounts with 400 to 500 locations, including the company’s own restaurants, hospitals, airports, hotels, schools, contract foodservice operators, department stores, coffee houses, and military installations. Some of the better-known accounts include Starbucks, Nordstrom, HMS Host International, Seattle’s Space Needle and Amtrack.

Customers may select from the bakery’s more than 100 different products, including cakes, cookies, croissants, Danish, individual desserts, muffins, pies, scones, and breads and rolls. In addition, the bakery supplies frozen dough scones, croissants, muffins, cinnamon rolls, Danish, cookies and pastries to Columbia River Bakery. That facility also mixes quick breads, coffeecakes, muffins, cookies and desserts not available from the Seattle facility.

Substantial growth
During the last 10 years, Schwartz Brothers Bakery’s output has grown ten-fold, producing 90,000 to 100,000 units each day. The bakery uses 3,000 lbs. of butter daily, taken from an ingredients inventory valued at an average of $250,000.

Despite the bakery’s growth in production, it continues to purchase all dry ingredients in 50-lb. bags–no silos or bulk bins. Officials note that several different types of flour, bases and mixes are required to prepare the wide variety of products, which affords flexibility to serve customers’ needs and to develop new products.

Moving in 1994 to the current location provided Schwartz Brothers “an opportunity to set up operations from scratch,” says Rick Doyle, regional bakery manager for the Seattle and Vancouver bakeries.

The production area is divided into separate rooms for yeast-raised pastries and sweetgoods, chemically leavened items, breads and rolls, equipment washing and ingredient storage. The design is part of a bakery-wide HACCP (hazard analysis critical control point) program to segregate ingredients and ensure food safety, Doyle explains.

Schwartz Brothers dedicates two automated make-up lines to single products–cinnamon rolls and scones.

As production has increased, Schwartz Brothers has employed greater automation to improve efficiency, while maintaining capability to create innovative products and to produce high quality in volume. Doyle cites several examples:

• Nearly every type of mixer, including vertical, spiral, horizontal and reciprocating arm units. Bakers use the reciprocating arm mixer to soften butter and mix dough for scones, the bakery’s largest volume product. “We like the mixer because it incorporates the butter without developing the dough,” he says.

• A four-piston batter depositor to scale muffins and quick breads. “The depositor portions batter quickly and accurately,” Doyle notes. “Then, for berry muffins, we top each with a single berry by hand for that love for our customers. They want to see the berry on top.”

• Two automated make-up tables, one used for cinnamon rolls, croissants and Danish, and the other exclusively for scones. “We have automated the manufacture of scones and still maintain that hand-made appearance,” he says.

• An automated bread and roll machine with divider, rounder, overhead proofer and sheeter/moulder. Bakers turn out 3,000 to 4,000 loaves daily, including 1,200 baguettes, which are hand scored.

• A high-speed packaging line installed this spring. Doyle says the bakery had packaged 15 to 20 items per minute and could not keep up with production. The machine increased production to 50 to 60 per minute.

• An automated rack and utensil washer. “Not only did this speed up cleaning, it has made a huge difference in the quality of our products and the cleanliness of our bakery,” he explains. “One of the best moves we made.”

When specifying equipment, Schwartz Brothers seeks machinery that will allow the bakery to maintain flexibility, Doyle continues. “We have many customers, all with changing needs. We cannot be pigeon holed into a piece of equipment that lacks flexibility and won’t give us the ROI (return on investment) we need.”

Greater mechanization also has required Schwartz Brothers to ensure that product quality does not suffer, Doyle adds, noting that two of the bakery’s ingredient suppliers have aided the effort, particularly by providing product analysis in their laboratories.

About 8 years ago, the bakery changed from scoring and cutting scones by hand, to using a cake slicer and finally to installing the automated make-up table. When hand-cutting the dough, bakers retarded it to yield a firm texture. “With the make-up table, we wanted to pull the dough from the mixer, run it through our sheeter and cut it at the same time,” Doyle recalls.

“We had serious issues; mostly, blueberries in the dough changed its integrity and wouldn’t allow for clean processing and cutting. We used the (scone mix) manufacturer’s laboratory to adapt the mix to work with our new processing procedures without changing the finished product.”

Expansion into retail products
Collectively, these measures to ensure high product quality have led to strong customer acceptance. This and available production capacity, spurred Schwartz Brothers to introduce a line of retail products this spring to be sold in food stores and supermarkets.

Derived largely from the wholesale product list, the line includes 33 items: scones, muffins, gourmet and holiday cookies, cinnamon rolls and dinner rolls. Some 40 stores carry the products, and plans call for reaching 100 by yearend. In addition, Schwartz Brothers Bakery co-packs private label retail items for local Trader Joe’s outlets.

To help ensure that retailers handle the products correctly, that is, adhere to code dates, Schwartz Brothers is hiring field merchandisers, who will see that product is rotated on time, Gretchen Mathers says.

Prospecting for retail customers is handled similarly to that for wholesale accounts. Notably, when sampling product with potential customers, David Walden, sales/customer service manager, pulls items from the previous day’s production. “We want them to see and taste it just as they would receive it and not sample just-made product,” he says. “This shows them the quality and consistency that we offer.”

Gretchen Mathers, operating partner, and Rick Doyle, regional bakery manager, review the new labels designs for Scwartz Brothers' retail products.

Consumer recognition of the Schwartz Brothers Bakery brand will be critical to the retail line’s success, officials agree. The company recently introduced a group of redesigned labels carrying the Schwartz Brothers Bakery logo. Each major product category was assigned a color. Previously, all labels featured a uniform color scheme and tended to allow the categories to blend together, Walden says. “These new labels provide contrast and help distinguish the different products.”

Selling efforts for the retail and wholesale businesses will focus on the bakery’s existing product list, Mathers says. “Many of our recipes are old. But, the old-fashioned recipes are still viable,” she explains. “We look for ways to adapt them for our customers. Still, these products must sell well because we don’t have room for ‘onezy-twozy’ products.”

Different avenues for growth
Officials see growth for Schwartz Brothers Bakery and Columbia River Bakery in different areas and are implementing systems and enhanced facilities to support it.

The Seattle management team is well established, and building the retail business will be a high priority, Doyle says. “That’s where our freezer capacity will be important. We sized our freezer for growth.” Currently, it holds raw product for the Vancouver bakery and frozen baked quick breads and muffins.

“We want to pursue laminated and Danish dough products,” he continues. “These will require blast freezing capacity.” Plans call for possibly installing a cryogenic freezer. “This will enable us to keep inventories up and expand into farther reaching markets.”

Meanwhile, Columbia River Bakery is continuing to increase its core wholesale business, which has quadrupled during the last six years to 30,000 units daily, Doyle says.

The two bakeries’ foodservice-based company shares something in common with full-line bakeries that have established successful wholesale baking businesses: Both have capitalized on their reputations with customers for high quality product and superior customer service.

These attributes, plus Schwartz Brothers Restaurants’ broad recognition throughout northwest Washington, are providing its partnership with Schwartz Brothers Bakery and Columbia River Bakery a formula for success.

A sampling of Schwartz Brothers wholesale prices
4-oz. Chocolate chip cookie, $0.40 to$0 .75
4-oz. Butter croissant, $0.40 to $0.65
Apple Danish, $0.60 to $0.80
5-oz. Marionberry muffin, $0.45 to $0.75
5-oz. Blueberry scone, $0.55 to $0.85

Schwartz Brothers...at a glance
Parent company: Schwartz Brothers Restaurants, Bellevue, Wash.
Bakery headquarters: Seattle
Founded: 1970
Web site: schwartzbros.com
Number bakeries: 2
Bakery size: 34,000 sq. ft. (Seattle)
Market served: metropolitan Seattle and greater Portland Ore./Vancouver, Wash. area
Wholesale customer base: 120 accounts with 400
to 500 locations
Bakery management: Gretchen Mathers, operating partner; Lindsey Schwartz, president; Rick Doyle, regional bakery manager; David Walden, sales/customer service manager; Dennis Ford, operations manager; Patricia Byrnes, research & development/ quality assurance manager
Number of employees: 120 to 130
Product line: full line of 100-plus SKUs
Production methods: scratch, proprietary bases
and mixes
Major equipment: vertical, spiral, horizontal, reciprocating arm mixers; bowl hoists and dumper; two cookie depositors; two batter depositors; two automated make-up tables; automated bread/roll system; automatic and semiautomatic divider/rounders; bread moulder; reversible sheeter; nine rack ovens; three retarder/proofers; cake slabber; cake slicer; bun slicer; tray former; high-speed horizontal wrapper; package sealer; shrink-wrap machine; metal detector; rack/utensil washer; 5,000-sq.-ft. refrigerator/freezer
Plans: increase retail product business; install cryogenic freezer
Bakery supply distributors: Dawn Food Products, Puratos, Borracchini Foods, Sysco, Glory Bee Foods