The Neighborhood 

Bakery that Grew
By Andy Hanacek
Heinemann’s Bakeries, one of the inventors of the in-store bakery concept, has evolved into a national wholesaler, all the while staying true to its traditional methods and quality.
When you ask people what they associate with Chicago, they might say, “Michael Jordan,” or “Al Capone,” or “Deep Dish Pizza.”     But that list overlooks one of the best and most-recognized names in Chicagoland — Heinemann’s Bakeries, which is now extending its reach throughout the nation as a wholesale baker.
The Heinemann’s line, which has been distributed in Chicago since before the Great Depression, evokes quite the positive reaction from the locals, most of whom grew up eating the company’s top-quality coffee cakes, brownies, sheet cakes and other bakery delicacies. Consumers love Heinemann’s simply for its quality. In the business world, however, there is another major accolade the company receives.
“We really kind of invented the (in-store bakery) category,” says Dennis Dorner, Heinemann’s manager of training and marketing. “Really, we say that we created the concept, and there’s a lot of truth to that. We had bakeries in supermarkets and some independent supermarkets as early as 1955.”
In its infancy, Heinemann’s was your typical Chicago neighborhood bakery, but it has grown up in a big way. Founder W.H. Heinemann sold the three-store company to Anton Dorner, Dennis’ grandfather, and Charles Meyering in 1935. Seeing that the product already had built quite a following, Dorner and Meyering opened nine more stores in seven years. The Dorner family took control of the company after Meyering died in 1942.
In 1959, the in-store bakery concept really took off for Heinemann’s, when it opened its first bakery department at a Dominick’s Finer Foods grocery store, beginning what the Heinemann’s Web site calls “a legendary Chicago business alliance.” Today, Heinemann’s distributes its baked goods daily to more than 140 stores around Chicagoland.
But geographic growth has been the goal for years now, and Heinemann’s has progressed well in its wholesale venture, without sacrificing quality or straying from its traditional baking methods.
Spreading the Word
Moving into the national wholesale business was a natural progression for Heinemann’s, which was looking for ways to expand beyond Chicagoland. However, switching from being a commissary to a wholesale baking mentality wasn’t an easy change to make.
The initial challenge was to develop a line of products that could be shipped frozen across the nation while not forcing the company to use preservatives — going against its age-old techniques, and frankly, possibly compromising product quality.
“Our idea is to give them a product that eats like a fresh product even though it’s a thaw-and-sell product,” Dorner says, “to make it in the same way that we’ve always made it, but figure out a better freezing alternative in order to make it perfect. So we got the spiral freezer that does it and does a great job, freezes it super low.”
Once the technique for Heinemann’s “Display and Sell Program” was perfected, the next biggest challenge became spreading the word about Heinemann’s quality and convincing stores that they could sell a “gourmet” product.
In some markets, Dorner says, the quality of the Heinemann’s high-end products had to speak for itself.
“There are some chains or some stores where they say they can’t sell anything over $2.50, and we say to them, ‘Yes you can; why don’t you offer it to them and see what happens?’ For the most part, once they offer it, it does fairly well to great. It just depends on the area,” Dorner says.
As more supermarkets have accepted Heinemann’s into the fold, its name recognition in regions across the country has improved. That word-of-mouth advertising within the industry, in turn, frequently leads supermarkets to Heinemann’s door.
“We started (in Milwaukee) about three years ago,” Dorner says. “That was because a chain up there needed some product, and they called us. We thought, ‘Well, that’s nice.’
“It’s a funny thing, but we’ve had a lot of chains come to us,” he adds. “They’ve seen the product somewhere else and (are impressed).”
Surprisingly, Dorner says, the geographic expansion of the Heinemann’s line didn’t progress from Chicago outward to adjacent markets. Rather, the expansion has resembled island-hopping more than anything, jumping from Chicago to Milwaukee to areas where former Chicagoans are clustered, such as Florida, Texas and Arizona. Heinemann’s currently sells its baked goods in about 30 states in some capacity, according to Dorner.
New Dynamics, Opportunities
From a production standpoint, the expansion has been a feeling-out process on how to approach the new dynamic of being a wholesaler.
“Before, being both a retailer and manufacturer, we made it, we delivered it, we sold it — it was simple,” Dorner explains. “When we had our own retail stores, we could plan out our own orders and schedules, and we knew just what to make and when to make it. But now our customers dictate the production schedule. So we found that we have to be able to adapt much quicker in this business in order to keep the customer satisfied. … And if that means we have to stand on our heads to do it, we will do it.”
Helping the company be flexible, though, is the capability to make any bakery product any customer would want, all with the same focus on Heinemann’s traditional methods of baking. The expansive product list also allows this kind of customization for individual chains.
“One chain might have a flavor of the month, like blueberry or lemon,” he says. “About three months before that would come up, we’d send them samples of things we felt fell in that category. In a lot of cases, it was an existing product we were making, like a crumb cake, that we just put blueberries in instead of apples or something.”
Making life at Heinemann’s a little easier as far as filling orders goes, though, is that some accounts let the company do what it does best — take more control over its product.
“Inventory management is a big thing. One of the things we’re getting into (is), we have a few customers that let us do some of the reordering,” Dorner says. “We have access to their schedules and sales records, we see when they’re getting down on something, and this gives us a real good handle on what they’re going to need in the (future).”
Destination: Indulgence
The nation may be caught up in a huge healthy-eating “epidemic,” but that hasn’t slowed Heinemann’s. Health-conscious, carb-crazed and calorie-counting consumers have changed the industry, but Dorner believes his company’s products are well-positioned to fight the battle.
“They’re deciding that, if they’re going to eat the carbs, they want something a little better (quality),” he says. “Because of that, our business is increasing.”
The Heinemann’s quality is reflected in the taste and the lack of preservatives. Because it doesn’t rely on anything artificial, most Heinemann’s products have a short shelf-life (3-4 days for Danish products), and the company’s brokers and sales staff are very cognizant of the code-dates around the nation.
But Heinemann’s has found that consumers are willing to pay the price for their products, regardless of shelf-life or price, and the company pitches them as “destination” products because of it.
“You could go into a supermarket in one of the lower-income areas (in Chicago), and it may be one of our best-performing stores,” Dorner explains. “To me, that shows that maybe they got used to the quality and taste of that product, and they’re going to keep buying it no matter what the income level.”
There are other benefits to Heinemann’s position as a destination product, Dorner says. It creates its own category within the bakery department.
“The tendency for any supermarket is to be on the cautious side with these products,” he says. “So they say, ‘Well, why should I replace these coffee cakes that I can sell for $1.99 with yours that I can sell for $3.99?’ And the answer is, don’t replace them: There’s room for both. Why limit yourself? There is a large segment of the marketplace looking for higher quality items. If you don’t have them, they might go someplace else — for everything!”
Those supermarkets that give Heinemann’s a chance see quickly that both products sell, as does the rest of the product throughout the store, Dorner says.
“Instead of just going in and grabbing (something), we have people who would kill to get to a Pecan Heart Coffee Cake three times a week,” he says. “And I think that has been our biggest advantage, in that it’s a product that people buy time and time and time and time again.”
In addition to reaping the benefits of repeat customers walking into the store and flexing their purchasing muscle, supermarkets get bonus assistance from Heinemann’s, which has the bakery department experience and can offer plenty of advice.
“We understand what kind of a mix of product they need in a store or area,” Dorner explains. “And we can tell them, ‘This is why this fits here or why it doesn’t fit there.’ … If we can give them a good product and show them how to sell it, that’s a big help.”
Heinemann’s also distributes sales sheets and pictures of every product they offer, along with sheets on future quarterly sales and even a step-by-step thawing chart in English and Spanish, “so when they’re melting the icing by piling five boxes on top of each other, they know not to do that,” he adds.
That chart, Dorner says, has become quite important, especially in warmer climates, where the icing tends to melt if not handled properly.
True to Tradition
To maintain its reputation as a Chicago tradition, Heinemann’s first relies on its veteran workforce. Many of them live in the South Side neighborhood and have put in 25 to 30 years baking in the plant, which first opened at its current location in 1965. On each line, experienced master bakers and pastry chefs work side by side with employees, overseeing production of some 175 products.
All items are made from scratch, Dorner says. Using real fruit, fillings are made up daily in two kettles in the back room. The company uses no lard in any of its products, including its butter cream icing and fillings. Rather, the butter-cream mixture is added to a flame-heated, 160-lb. four-bladed mixer.
Moreover, some products, such as the bright green Devilsfood Pistachio layer cake, have been Chicago favorites for decades and are simply unique to Heinemann’s product portfolio.
Overall, the 170,000-sq.-ft. facility houses eight lines, including two Danish lines, two bread lines and a single line for donuts, cookies, brownies and cakes. Some of the systems are on rollers and can be moved in and out of the production area, providing much-needed flexibility for the operation. Heinemann’s employs between 250 and 300 people. The number fluctuates during the peak winter holiday season.
Throughout the facility, production is a combination of automation and handwork, partly because of the variety of products made on a daily basis and partly because some items, such as its signature, super-premium Danish line, take up to 24 hours to produce in an Old World manner.
“We let the dough sit in a retarder overnight because we want to get that fermentation flavor that makes it distinct,” notes Jim Bersell, Danish production supervisor. “Other companies tend to use a straight dough, using additives. Our products don’t have any chemicals, unless you include yeast.”
While it remains true to tradition, Heinemann’s has automated where it can to streamline production and improve operational efficiencies. Recently, it installed a new 2,200-lb. horizontal mixer that added capacity and front-end controls to the Danish line.
It also has added new packaging equipment to streamline and enhance packaging capabilities. For its in-store bakery customers, the company puts its products in a variety of clamshells and plastic-windowed boxes with labels that may carry the customers’ or the Heinemann’s brand name.
Along with the new spiral freezer two years ago, the plant’s 900-pallet holding freezer, which is set between -5F and -8F, allows the Kosher bakery to build some inventory and conduct longer runs instead of baking everything to order, Dorner says.
Baking Signature Items
Around midnight, production begins on the bread and cookie lines and then moves in a fluid manner to cake, donuts and Danish with employees working six days a week at 8- to 10-hour intervals, depending on the amount and type of orders. The company generally maintains a 10-day lead-time for incoming orders.
“We want to keep all of our ovens full, so we have different makeup lines scheduled at different times during the day,” explains Lloyd Yahn, head of purchasing, plant equipment.
Three 120,000-lb. silos and two 90,000-lb. silos supply the plant with flour. Minor ingredients, such as high-fructose corn syrup, are stored in 3,000-lb. totes, and eggs and soybean oil come in 2,100-lb. containers. Other minor and micro ingredients come in 55-lb. bags or small containers.
Bakers begin creating and laminating the dough on the previous day to produce its top-selling Danish products, which includes everything from Pecan Heart Coffee Cake and soft sweet rolls to the German delicacy Stollen.
Operators first mix the dough for about 11 minutes at 65F. After depositing the batch into a dough pump, it’s extruded into the hopper for the makeup line. To eliminate sticking, two flour dusters — one before the hopper and one after — deposit flour on the belt and on top of the layer of dough.
After dusting, the dough passes through a sheeter, cross roller and a guillotine to create a rectangular sheet that’s about 2-ft. long by 8-in. wide by 1/2-in. thick. The sheet passes under a fat extruder and spreader before the first operator gives the sheet a manual three-fold and turns the sheet 90-degrees for further lamination.
Next, the sheet runs through a double set of sheeters and a cross roller before the operator manually folds the sheet four times. After passing through two more sheeters, a third operator once again does a manual four-fold. The sheet is then placed in a rectangular 3-ft. baking pan and a fourth operator uses a wide rolling pin to manually degas the dough so that it doesn’t overflow during the fermentation process. The pan is racked and placed in a walk-in retarder set at 38 to 40F for 10 to 12 hours.
On the next day in another room, the racks are pulled out of the retarder about 30 minutes before makeup to relax the dough and to bring up the dough temperature. During SF&WB’s plant visit, Heinemann’s was making up 22-oz. Pecan Heart Coffee Cakes, one of its best-selling items, at a rate of 1,440 per hour.
Here, an operator manually loads the dough sheet from the pans to the makeup system. Again, two flour dusters spread flour across the belt and the top of the dough sheet to eliminate sticking during the process. After passing through another two sheeters and a cross roller, the sheet passes though a four-blade roller cutter that divides it into two 4-in. continuous strips and trims the edges. The scrap is recycled into the mixing process.
After filling with cream, the two sheets pass under a spreader and then to two cone curlers, which roll up the dough into a tube that’s guillotined into 22-oz. pieces. Eight workers then fold the tube into a heart shape, hand-stretch the piece and place it into bankable trays. After hand-washing, two operators then top the piece with a cup of pecans and place four pieces to a pan.
“We have to do this by hand because there’s no machine in the world that can make this product,” Yahn says.
The racks, which hold 36 pans each, are wheeled into a six-door walk-in proofer for 60 to 90 minutes at 92F and 55% relative humidity. The proofbox holds 36 racks.
“You want to set the proofer so the products aren’t soaking wet, yet you don’t want a skin on them either,” Yahn explains.
After proofing, the pans are manually loaded into one of two 43-tray ovens. The bakery also has a smaller 20-tray oven and five single-rack ovens, each of which holds 30-pan racks. Heinemann’s bakes brownies, cakes, cookies and other sweet goods in these rack ovens.
After baking for about 35 minutes at 305F, the Pecan Hearts cool and are shower-iced with fondant before entering the spiral freezer for 15 minutes at -23F. The coffee cakes are packaged in window boxes and pass through metal detection before being manually case loaded and palletized.
Baking for In-stores
Chocolate brownies are another signature product for Heinemann’s. Everyday, the plant cranks out about 1,300 cases, with each case holding six clamshells filled with 36, 2-in. square brownies. In addition to chocolate, Heinemann’s produces butterscotch, peanut butter and praline flavors. They come in a variety of packaging sizes, tailored to the needs of the individual in-store bakery customers. All clamshells are sealed with C-labels, which makes them tamper evident. The plant also can shrinkwrap its packages.
In the bread department, the bakery operates one line for breads and rolls that are 10 oz. or less and another line for those products that are greater than 10 oz. The bread line that produces the smaller items is equipped with a six-pocket divider that can crank out 15,000 products an hour. For larger loaves, the two-pocket bread line can produce up to 1,000 loaves an hour.
In the coming months to further streamline production, Heinemann’s is moving its bread lines closer to the spiral freezer.
This move should free up space that will allow for longer Danish runs and allow the bakery to add a third makeup line in that department.
In addition to thaw-and-sell products, the plant also produces frozen dough for some of its customers. An on-site quality assurance department and test kitchen bake off samples from each batch to ensure that the product performs and tastes as expected before it is sent to the in-store bakery.
For food safety, the plant is audited by the American Institute of Baking and it’s currently in the process of achieving Hazardous Analysis Critical Control Points (HACCP) program certification. Heinemann’s is also inspected by several of its major customers, Yahn says.
Outside of its freezer, the warehouse and staging area has 10 bays, four of which are for customers and common carriers with 18-wheel tractor-trailers. The remaining bays are for local and regional deliveries.
With Heinemann’s growing its wholesale business and having plenty of room within its facility to expand, Chicago’s own “Neighborhood Bakery That Grew Up” should continue to make those who grew up with Heinemann’s products proud to share the super-premium, traditionally made delicacy with the rest of the country.
—Dan Malovany contributed to this story.