When 5 Generation Bakers, McKees Rocks, Pa., moved into its new facility in 2016, it had the capacity and efficiency to take the business to the next level. The company was experiencing double-digit sales every year. In 2017, the bakery added a second shift. Scott Baker started innovating new products, including chunky bread and sticky buns. 5 Generation Bakers went beyond the company’s in-store bakery customers. Scott Baker pitched the product to the QVC home shopping network. As an old-fashioned crimp-style bread, it seemed like a perfect fit for QVC’s dedicated food audience. QVC passed at the time, but the company gained more foodservice business and had its own e-commerce platform on its website. However, one foodservice account made up 50% of 5 Generation Bakers business, which Scott Baker admits was risky.
“We knew it was a concentrated risk to put so much business with one customer, and it was one we were moving away from,” he said. “But I just couldn’t say no to a $2 million account.”
Though 5 Generation Bakers was reducing the account’s impact on the business — it was 40% in 2018 — it was too little too late. The customer wasn’t transparent about the forecast, and overnight, Scott Baker learned that the next week’s truckload of product would be the last. With the loss of $1.5 million in one fell swoop, the business that had been experiencing double-digit growth and meeting its financial goals was suddenly facing a rough 2018-2019. Then came the pandemic.
With the closing of restaurants and schools and shoppers avoiding the in-store bakery, the company lost 50% of its business. Scott Baker got strategic about how to meet the orders and maximize his employees’ time. He alternated running production for a week and laying off his staff for a week so they could collect the stimulus unemployment. The next week he would hire them back.
What kept 5 Generation Bakers going was the 500% increase in online sales. QVC noticed the intense growth it was experiencing in food sales and looked to expand that side of its business. The home shopping network called 5 Generation Bakers, asking if the company was still interested in a partnership. Scott Baker was.
The bakery filmed its first segment in November 2020 and another before the end of the year. Those two appearances were so successful, the partnership has continued. The bakery also started producing sliced bread as a co-manufacturer for another food processor. Between those two opportunities, 5 Generation Bakers was able to post 15% revenue growth for 2020. In 2021, 5 Generation Bakers achieved 25% revenue growth with that new business and in-store bakeries, restaurants and schools reopening.
Scott Baker sees QVC as the place where 5 Generation Bakers can really grow. It’s enabling him to fulfill his ultimate dream — to make Jenny Lee a household name across the country. While the sales margins are good with the partnership, it’s the reach and exposure that’s valuable to that goal. Through sales to consumers, Jenny Lee is already reaching all 50 states and gaining exposure to retailers who might not have otherwise heard of the brand.
“QVC is the most exciting channel we’re in because it’s making us a national household name,” Scott Baker said. “QVC brings exposure, creates a personality and provides a place where I can offer them some new and exciting things.”
The company launched three savory breads — Olive Focaccia, Garlic and Herb, and Tomato Basil — in March. The products had been developed in 2020, but the launch was delayed while 5 Generation Bakers found its footing during the pandemic. Bringing those products to QVC provides a platform through which Scott Baker can educate consumers on how to use these new breads.
“I have 7 minutes on QVC to show them how to use our olive focaccia to make a pizza or even a grilled cheese sandwich,” he said.
Today, Jenny Lee products are found at in-store bakeries in 20 to 25 states in the Northeast, moving into the northern Midwest. 5 Generation Bakers has foodservice customers in Texas, Oklahoma and Missouri and is growing its reach in that side of the business.
The Baker family businesses haven’t always had it easy, but each generation has found a way to see the opportunity in each challenge and rebuild the business in that generation’s own image. For Scott Baker, that has meant streamlining for efficiencies, a commitment to clean labels and his own values of integrity and making someone’s day with his family’s iconic brand. With double-digit growth and a plan for the future, the sky is the limit.
This article is an excerpt from the May 2022 issue of Baking & Snack. To read the entire feature on 5 Generation Bakers, click here.