As part of my series about the “5 Things You Need To Know To Create a Successful Service Business,” I had the pleasure of interviewing Josh Allen, Founder of Companion Baking. Born and raised in St. Louis, MO, Allen was immersed in the food and baking industry from an early age. His great-grandfather founded Allen Foods, a well-known broadline food distributor with a large customer base across the Midwest. Allen spent much of his childhood delivering groceries to various foodservice operations, cleaning the freezers and sweeping the trucks for his family’s business.
In 1991, Allen earned his degree in American Studies from Stanford University in Palo Alto, CA. Following graduation, Allen remained in the Bay Area working for various artisan bakers and grocery stores including Whole Foods Market and the Oakville Grocery Co., where he gained valuable baking experience and learned what it took to operate a business.
With a dream of opening a baking facility of his own, Allen returned home to St. Louis in 1993 and leased a small corner of a manufacturing facility operated by his family to create Companion Baking. He started with just six breads in Companion’s production line but gradually expanded the business, partnering with local and regional restaurants and grocery chains to build the customized bread programs Companion has become known for.
Today, Companion’s award-winning bread is served in more than 400 restaurants, grocery stores, and businesses around the Midwest and across the country. Allen credits his success to listening and nimbly adapting to his customers’ wants and needs. In addition to their baking operations, Companion has two cafes in the St. Louis area and has expanded to offer a small line of pastries.
Thank you so much for joining us! Our readers would love to “get to know you” a bit better. What was the “Aha Moment” that led you to think of the idea for your current company? Can you share that story with us?
“After graduating from college, I was swimming recreationally with a group that included the President of a small chain of upscale specialty food stores. Because I had a degree and was currently working in a couple of small local bakeries, he hired me to do an analysis of his idea to open a commissary bakery for his growing chain of stores. After researching the project for about ten months, we came to the conclusion that given the geographic disparity between his stores, one commissary bakery wouldn’t be able to adequately supply all the stores with fresh daily bread and pastries. I was left with a ton of quality information, but without a company to do it for.
I had grown up in a family foodservice broadline distribution business. I had a good understanding of the wholesale trade and a family with a great reputation for integrity. I decided to move back home to St. Louis to combine my passion for baking bread and my knowledge and limited understanding of the food industry.
I happen to hit it at a great time as the micro vendor communities across the country were really expanding. Coffee roasters, brewers, and bakers were beginning to gain a foothold in the wholesale business in first- and second-tier markets across the country. Bread was beginning to be a catalyst for conversation and not simply an afterthought — for restauranteurs and diners alike.”
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘take aways’ you learned from that?
“About five years into Companion Baking, I really decided I wanted to expand our offerings beyond breads. We had grown steadily from artisanal hearth (free-form) breads to dinner rolls, sandwich buns, and sliced breads. The next logical step was breakfast pastries (Croissants, Danish, muffins, cookies, scones, etc.). We hired a pastry chef and began to develop the product mix we would take to market.
My grandfather had told me before I opened that I simply needed to “shut up and let my customers tell me how to build my business,” so we invited our top 25 customers to help us finalize the list. We rented a ballroom, spent days baking the most glorious display of breakfast pastries, prepared fancy ballots on which they could cast their votes for which decadent flavors of Danish they desired, and prepared to launch our new venue.
All the chefs and buyers filled their coffee cups and plates for breakfast. I stood in front of the group and after thanking them profusely for coming and supporting us, I begin to discuss the merits of all-butter croissants and handmade fillings. One of the chefs politely interrupted me and asked very matter of factly, “Can you deliver by 5 AM?” And then a chorus of others chimed in as well, “Saturdays?” “Short lead times?” “Special orders?”
“Sure. Of course. Yes.” I answered naively. “But what about cherry or blueberry?”
Altogether they said, “It doesn’t matter. A nice selection. Good quality. Just be there on time and make it easy to order.”
I hadn’t thought any of those things through. I thought variety was going to be the sticking point. That I’d have to sell the merits of the product. In the end, primarily based on our reputation for making quality breads, the issue of quality pastries was never their concern. Their concerns were about logistics. By saying “yes,” I was solving problems I never even realized they had. Those would certainly become problems for me. It completely changed our distribution model requiring earlier bakes, more conscientious packers, more trucks, and higher minimums. We grew a nice pastry business but not without fundamentally altering our whole model. I didn’t see that coming at all.
I’ve tried to continually apply this lesson over the years. I continue to have the courage to change lanes and try new things, but I’ve done a much better job in thinking through and anticipating the course corrections for our whole company when we grow into new areas.”
Thank you for that. Let’s now pivot to the main focus of our interview. Extensive research suggests that “purpose driven business” are more successful in many areas. When you started your company what was your vision, your purpose?
“To be perfectly honest, 27 years ago (and as a 24-year-old), I didn’t have a vision that I could articulate. I had fallen in love with baking bread in the Bay Area. After the opportunity with the specialty food store had not materialized, I decided to pack up and move back to my hometown of St. Louis to continue baking and open a small wholesale business. Ignorance is bliss, as they say. I worked all night and sold bread all day. There was something appealing I guess to the flour-dusted kid trying to make a go of it, and the culinary community supported us from day one. It was neat to be a part of a newly blooming food scene in a city that was heavily influenced by independent owners, super talented chefs, and well-traveled diners.
We have since evolved to become a business whose purpose is to help folks tell their story with customized bread programs — bread made special for you. It’s a real joy for me to manufacture baked goods that allow restauranteurs, chefs, and grocers be able to fulfill their visions with our products.”
What do you do to articulate or demonstrate your company’s values to your employees and to your customers?
“We take tremendous pride in “Taking Care of the 4Cs” — our companions, our customers, our company, and our community. Everything we do has to positively contribute to the 4Cs. Not necessarily equally, but positively, nonetheless.
Additionally, I’m an avid cyclist and I use my two wheels to try to make an impactful contribution to my community. I eagerly support two organizations centered around cycling — Chefs Cycle and Pedal the Cause. Chefs Cycle is an annual event bringing together the foodservice community to support No Kid Hungry, an organization committed to ending childhood hunger in America. Pedal the Cause is a St. Louis based group that raises money to fight cancer. Both give me a physical and mental outlet to support two causes I care deeply about.”
Do you have a “number one principle” that guides you through the ups and downs of running a business?
“It’s all work and it all has to be done. Another thing my grandfather reminded me of a lot. I pack bread every day. I clean the bakery every day. I make investment decisions. Purchasing decisions. Branding decisions. This is all important stuff, and each companion on our team is contributing to our success. I don’t take anything or anyone for granted. The pandemic has really brought that home for me as we’ve worked to survive this last year. The 4Cs are more important than ever.”
Can you tell us a story about the hard times that you faced when you first started your journey? Did you ever consider giving up? Where did you get the drive to continue even though things were so hard?
“Truth be told, it was exhausting. For the first three years, I worked 9 PM (yes, that’s PM!) to 5 PM, six days a week. It took a long time to build a team that I trusted and one that understood just what I was looking for in both the products and the customer experience. It was incredibly lonely. There was no internet really. No email. No YouTube. Working overnight is like living in a parallel universe.
I just kept saying “yes” to opportunities and then tried to figure out how to deliver a great product and great service. Chefs loved that I would be the one answering the phone at 1 AM as they were placing the order for the next day’s bread. I did everything I could to ALWAYS answer the phone so I had a chance to build on the relationship.
Our business today, selling frozen baked goods across the country, is a direct result of simply answering the phone and saying “yes.” I got a call from a grocery chain that had just opened a few hours away in Columbia, Missouri. It was one of their first stores outside of their native Colorado. The frozen product they had spec’d to use was stuck somewhere in the supply chain and they needed bread immediately. Could we create a program similar in scope to what they were getting and start delivering it NOW? Yes. We put it together quickly, found a small courier company that would deliver fresh daily, and got started. Over the next 30 days, we refined the program, added products, and helped them outsell their original stores in the department. Would we entertain doing the line frozen and get the products to all of their stores? Yes.
So began the journey from fresh to frozen nearly 20 years after we started.”
So, how are things going today? How did your values lead to your eventual success?
“We’re still baking and still passionately delivering ridiculously great service for our customers. The pandemic has been a tremendous challenge for our industry but has also opened up opportunities for us that were accelerated by COVID-19. We have taken over bakery operations for two large customers in the last six months that probably wouldn’t have happened for 2–3 years without the pandemic. The first is a large pizza chain that has been inundated with growth needed to offload bread production in order to meet pizza demand. Our “Yes” attitude and our nimbleness was a perfect fit. The second is a grocery chain that outsourced a large portion of their commissary baking recently due to challenges associated with COVID-19. I strongly believe these folks reached out to us because of our reputation for getting things done, communicating clearly, and jumping in with both feet”.
Based on your experience and success, what are the five most important things a founder or CEO should know in order to create a very successful service based business? Please share a story or an example for each.
- “Honesty really is the best policy. Great service includes telling the customer what you can’t do as well as what you can. We’ve dealt with lots of absenteeism during the pandemic. It’s been hard on our companions, and they don’t always make it to work when they face issues with childcare or life. As a result, we’ve sometimes had a hard time filling orders completely. We’ve always reached out immediately to our customers when we know we have an issue. The supply chain across the country is in disarray, but the hardest part is the lack of communication. Our customers are starved for information and are incredibly appreciative of us simply letting them know what we’ll have and what we won’t. The transparency has value. It’s hard to make the call and tell someone that you will not hit the mark, but burying your head in the sand and short shipping with no communication is so much worse.”
- “Waste not want not. We put a tremendous amount of energy behind reducing waste in our organization and our processes. It’s not just a matter of generating less trash (though we’ve done that by reducing our waste from 1.6 million pounds annually to less than 600,000 pounds in our factory). It’s also about developing systems to catch mistakes early and slowing down to do things right the first time.”
- “Bend but don’t break. Be nimble. Move quickly. Say Yes. We’ve always been open to trying new things and continuously improve our methods. We embrace change.”
- “Celebrate success. It’s easy to keep your head down and keep pushing forward. When I first opened the business, I was concerned that celebrating a success was akin to settling for the status quo and not constantly striving to do better. I’ve since learned that folks really appreciate being recognized in front of their peers. Groups like achieving their goals and toasting to their success. I’m a big chart guy. I’m always stopping production and sharing a chart that shows our team something we did really well. Did fill rate improve 4 weeks in a row? Let’s make sure everyone knows. Did the sales team bring a new grocery chain on board? Bring that team in front of production and give them a round of applause. Stopping and smelling the roses has been even more critical during the pandemic. There isn’t always good news in people’s lives right now. A little cheer does go a long way.”
- “Show up and be nice. Simple stuff. Ask folks how they are doing. Give them some extra time and space to take care of family or childcare issues. Recognize that things that used to be easy (going grocery shopping, getting a car serviced, visiting the doctor) are all more draining and time consuming in the current climate. We genuinely care about our companions and our customers and our community. We treat people fairly. We make bread affordable and accessible. We support causes that matter to us. Kindness matters. And it’s contagious.”
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
“My father and grandfather. They successfully built a multi-generational family business built on valuing relationships. Their customers and their employees were like family. I had the honor and the opportunity to work there every summer as a kid and to see firsthand how they treated people — customers, employees, vendors. They were good spirited and kind, but also scrappy and tough. They believe they succeeded by out-working everyone else. It was how I was wired.
When I decided to open the bakery instead of joining the family’s endeavors, they were both my biggest cheerleaders and the ones who loaned me the money. More than any bank, I certainly didn’t want to disappoint my grandfather or tell him I hadn’t worked hard enough to succeed. Up until he passed away in his early 90s, he always would ask me what the price of wheat was on the Kansas City Board of Trade. I was only buying a few bags of flour at that time, but he always wanted me to understand the commodity price so that when things grew, I could understand the market and be prepared.”
You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)
“The Be Kind Movement. It really isn’t that complicated. Let the car merge in front of you. Hold the door open for folks. Say thank you. Call your mother. Do something special for your partner. Cheer for your kids. The world would be a much better place if folks were simply nicer to one another. “
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