100 Years On The Best-Seller’s List
May 1, 2006
100 Years On The Best-Seller’s List
By Dan Malovany
Bakery pioneer Dora Schwebel raised six children on her own, helped feed a community during the Great Depression and built one of the industry’s most successful independent bakeries through sheer will … and by outworking the competition.
Fresh out of college in the early 1960s, Joe Schwebel was ready to hit the world running. His alma mater, Wharton School of Business, literally specialized in teaching its students how to run a company like General Motors. In fact, his undergraduate thesis was “Methodology of Problem Solving.”
Now that’s hardcore.
So, first day back on the job at the family bakery in Youngstown, Ohio, Joe Schwebel asked his grandmother Dora, “Where’s my office going to be?”
Little did he know.
Dora Schwebel, the company’s founder and president at that time, kindly invited him into her office, sat him down and set him straight.
“We have 39 wholesale routes,” she told him. “Tomorrow, you’re going to ride route No. 1, which leaves the bakery at 4:30 in the morning and goes to Warren, Ohio. The next day, you’re going to ride route No. 2. That goes to Campbell, Ohio, at five in the morning.
“When you get done riding all 39 routes, then we’ll talk about what you’re going to do next,” she added. “We’ve been making a lot of money without you for a lot of years.”
The moral of this story?
“You don’t learn the bakery business out of a book,” Joe Schwebel now says. “It’s a street business. You learn it on the street with customers and with people who you work with. That was a great lesson for me.”
In addition to Dora, Irving and David Schwebel, Joe Schwebel is the only other president of this venerable independent baking company, which operates four plants and 29 distribution centers that serve most of Ohio, western Pennsylvania, western New York and northern West Virginia. The bakery produces an extensive line of products, ranging from the signature Jewish Rye Bread that has the same formula Dora Schwebel used back in 1906 to an assortment of sandwich breads, hearth baked products, brown ‘n serve items and even bagels, English muffins, pita and tortillas.
Not only is Schwebel Baking the retail market share leader in Cleveland; Akron/Canton; Youngstown; and Columbus, Ohio; as well as in Pittsburgh and Erie, Pa., it also is the leading restaurant-and-institution baker across most of its territory. That’s quite an accomplishment in a fiercely competitive market that’s home to several of the nation’s major players.
“We should all wear badges that say, ‘survivor,’” Joe Schwebel likes to say. “Any company that reaches the 100-year milestone has gone through some difficult issues, problems and challenges.”
An Industry Pioneer
Alyson Winick, the bakery’s senior vice president — sales and one of nine family members currently running the business, remembers her Grandma Dora as strong-willed with an often no-nonsense attitude. She also recalls the lore of this baking industry pioneer.
In 1905, according to Winick, Dora’s husband Joseph Schwebel initially went into business with a partner and lost everything within a year.
Shortly after that business failed, he asked his wife, “What are we going to do?”
“First of all,” she replied, “we aren’t going to have any partners.”
Within eight years of baking the first loaf of bread, Schwebel Baking was serving a growing number of mom-and-pop stores, eventually hiring its first delivery/salesperson. A short time later in 1923, the Schwebel’s business base had expanded so much that they spent $25,000 to open a small bakery that produced 1,000 loaves a day distributed by six delivery trucks.
In 1928, however, Joseph Schwebel died, leaving Dora with six children and a bakery to run. Friends and family wanted her to sell the operation and focus on raising her family.
“That was the furthest thing from her mind,” Winick says. “She forged forward to make this thing work. She had her family to feed and the families of others who worked for her. She felt very responsible.”
During the next year, the second shoe fell. The market crashed, the business lost its investments, and the ensuing money crunch left the company with no upfront cash to pay the local miller who supplied it with flour.
“Faced with closing the business, she got credit by saying, ‘If you don’t give me credit, I’m going out of business. I don’t have the money to pay for next week’s flour. If you give me credit and I don’t fulfill my obligations, I will clean your floors to pay it off,’ and she meant that,” Winick says.
With her son, Irving, who had returned home from his second year in college, Dora Schwebel and the family made it through the Great Depression. In fact, the business flourished so well that Schwebel’s built a new bakery in 1936 and expanded it in 1938 and 1941. Ten years later, the family opened their “million-dollar-bakery,” making the company a fixture in Youngstown.
“She ran a business when women didn’t run businesses,” Winick explains. “She didn’t try to gain anything from it. She fed the city of Youngstown at times during the Depression. If you were hungry, you could always get bread from Aunt Dora.”
Expanding Its Borders
Dora Schwebel passed away in 1964. However, under the guidance of Irving Schwebel, her successor, the baking company moved beyond the Youngstown area in the 1970s, opening up a depot in Canton and sparking an era of geographic growth over the next three decades.
In 1974, for instance, the local bakery in Cleveland went belly up. Panicked restaurant customers there called Schwebel Baking to bail them out. At midnight after getting the call, Joe Schwebel recalls, the bakery sent out a driver/salesman with a flashlight, map and baked goods. Cleveland, he says, now is multi-million market for the company.
Like many baking companies, Schwebel Baking expanded through acquisitions as the baking industry consolidated. In 1976, for instance, it purchased Vienna Baking Co. outside of Pittsburgh, allowing it to enter western Pennsylvania. Throughout Ohio, it bought bakeries in Cuyahoga Falls, Solon and Hebron.
In some cases, Schwebel’s built a market from scratch by simply establishing a distribution center in a town. In the 1980s in Columbus, about 180 miles from Youngstown, the baking company leased a large building, rented a furnished apartment and gave two sales people 12 months to crack the market.
“If you fill up one semi a day within a year, fine. We’ll stay in Columbus. If not, we’re coming home,” Joe Schwebel remembers telling them.
“As luck would have it, a couple months after they moved down there, there were changes in the market,” he adds.
Ohio State University put its baking business up for re-bid. Schwebel’s got it, the semi was full, and the rest is history.
Tribute to its Heritage
To solidify its position in the bread aisle, the company continually developed new products. Joe Schwebel’s favorite was Golden Rich bread, which took the market by storm in 1967.
“The bread was richer than others,” he recalls. “It was made with eggs, more sugar and more flavor, and it had a gold wrapper and we had fun with it. We presented it to our customers in a treasure chest with dangles and beads, and inside was this loaf of bread. We got extra space and displays and within a year, it became our leading seller.”
The bakery also added a battalion of franchise brands, including Roman Meal and Country Hearth, to name a few. One of its more recent franchised brands is a breakfast bread sold under the Cinnabon name.
To develop brand loyalty, Schwebel’s has relied on newspaper ads, billboards, and television and radio commercials. Some commercials focus on taste, quality, family and tradition. Others use humor to slam the message home. For example, one TV spot shows a little boy tossing competitors’ bread pieces to ducks, which in turn whip it back at the kid. The message is: “If it’s not Schwebel’s, don’t eat it,” says Lee Schwebel, director of corporate communications.
So extensive are its archives that Schwebel’s has compiled a CD of 15 of its classic radio commercials. Dating back the mid 1950s, the hit list includes a holiday greeting by Dora Schwebel — probably the only recording of her — and another featuring Happy The Clown, who made his debut in 1932 to boost the spirits of consumers during the Depression and is still used as the company’s mascot.
At Schwebel’s headquarters, the lobby and hallways have been transformed into a museum dedicated to the company’s rich past.
The walls are covered with snapshots of uniformed route sales reps, vintage vehicles and bakers working on production line making bread using the eight-hour, sponge-and-dough process for bread and a 28-hour process for its signature rye bread.
“We believe in quality,” says Joe Schwebel, who has been heading the company since 1985. “We use only the finest ingredients. We don’t believe in taking shortcuts when it comes to making a quality loaf of bread.”
In addition to photos of the founders, their children and the current family members, the bakery displays print ads from throughout the decades, which document how the brand evolved over the years to remain relevant to consumers. Newspaper articles capture key historical moments for both the bakery and the country. Assorted bakery memorabilia is set up like a time capsule on display.
The theme to the anniversary is “Celebrating 100 Years … Thanks To You.” Besides promoting its centennial on packaging, the bakery is relying on a public relations media campaign to spread the word, Lee Schwebel explains.
Moreover, the company has divided the yearlong celebration into four phases. After launching the campaign in January, the company held two days of internal parties with its 1,280 employees and 370 retirees in April. In September, Schwebel’s will conduct a back-to-school campaign on the packages of its products, and during the holiday season, “the bakery will give back to the community,” Lee Schwebel says.
For Joe Schwebel, the most comforting aspect of the centennial is that the fourth generation of family members is getting involved in the business.
“We inherited a legacy from our grandparents, who started the business in 1906,” he says. “It was all about the family staying together. The family is always at the core. The family must work together. That’s essential. That must continue for us to be successful as we go forward.” SF&WB
At a Glance
Company: Schwebel Baking Co. Inc.
Headquarters: Youngstown, Ohio
Founded: In 1906 by Dora and Joseph Schwebel
Brands: Schwebel’s along with Country Hearth, Millbrook, ‘taliano, Roman Meal, Sun-Maid, Cinnabon bread and Milton’s brands
Products: Bread, buns, rolls, English muffins, bagels, pita and tortillas for retail and foodservice channels
No. of Bakeries: 4. Youngstown, Cuyahoga Falls, Solon and Hebron, Ohio. Produce 700,000 loaves daily.
No. of Employees: 1,280
Web site: www.schwebels.com
President: Joseph Schwebel
Executive V.P.: Paul Schwebel
Sr. V.P.-Purchasing: Barry Solomon
Sr. V.P.-Sales: Alyson Winick
Sr. V.P. -Transportation: Joseph Winick
Treas./Sr. Accountant: David Alter
Dir. of Corp. Communications: Lee Schwebel
Strategic Technology: Adam Schwebel
Accounting/Financial Analyst: Maryn Schwebel
CSM Merges Caravan, American Ingredients
CSM Bakery Supplies North America has unveiled plans to merge Caravan Products, Totowa, N.J., and American Ingredients Co., Kansas City, Mo., into a single operating company. The new company will be headquartered in Kansas City, but the Caravan Product Development Group will remain with the New Jersey plant.
“This measure is in line with previous announcements regarding the reinforcement of CSM’s market positions and organizations and is a part of CSM’s worldwide 3S program (a Strong company, a Sharp team and a Solid performance),” according to a CSM release.
Neither the Caravan or American Ingredients sales organizations will be affected, but about 30 positions and individuals will be impacted by the transition, the release also explained.
In early April, CSM announced plans to close its H.C. Brill production plant in Elk Grove Village, Ill. The action will be completed during the second quarter of 2007.
Caravan Products has supplied cutting-edge products and services to the baking industry for more than 100 years.