Business Lessons from The Bakery Boss
The context is one where Buddy, an expert in the field of the culinary art, advises failing bakeries on how to turn around their businesses. They apparently apply for help when their businesses are in trouble. Buddy then arrives and consults them. The whole process is recorded and broadcast to TV audiences worldwide.
Watching the series with my wife and son, I realised that the series presented some great business ideas. Here is my attempt at identifying the business lessons from The Bakery Boss.
- Most of the bakeries are in deep financial trouble before the owners ask for help. While they can tell you precisely how much money is coming in and how much is going out (a good sign!), they do not understand the implications of the numbers. Believe your stats and understand them. It’s no use just knowing them; understand them and the implications thereof! Why wait until so late before taking action? Timeous action will prevent crises actions!
- On the issue of costs and stats, know exactly what your products cost and how much you can sell them for. Buddy frequently finds a product that is priced way above what the market will pay! What will your market be prepared to pay, and can you make it at a cost that will allow you to make a decent profit? You cannot waste money in your internal value chain! So, put effort into creating a lean and mean operating model.
- When Buddy arrives and he does his taste exercises of the product, they all disagree with him! They do not want to believe that the quality of their product sucks! Especially the chefs! He then has to go through taste exercises to convince them he is right! It tells me they are in denial. They do not know what the real problem is. It also tells me that they have a vested interest in their existing way of doing things. It tells me there are orthodoxies at work as to what is good. “I know my business!” It tells me that we need to be open to other points of view.
- They all say, “it is not the product that is at fault”! They then have to be convinced! It tells me that they do not know what their customer is about, what he/she likes! It reminds me that frequently these owners are chefs that love baking. They then look for customers. This smacks of the hammer syndrome! If all you have is a hammer, after a while everything looks like a nail! Be customer focused. Know your customer!
- The lack of self-knowledge on the product, also tells me that they overestimate the quality of their product – the halo syndrome. Buddy refers to ego and pride! You have to believe in your product if you want to sell. However, if you do not sell, you need to understand that maybe something is wrong. And then there should be no holy grails, no untouchables!
- Everyone feels his/her product is great. It reminds me of the Dirty Harry syndrome: “If he is so bloody good, why is he so bloody dead?!” Be realistic about your offering. Be confident, but be open to outside feedback. If your product is not selling, something must be wrong.
- They do not believe Buddy and actually frequently get aggressive towards him. Question: why ask him to help if you do not want to be open to his message? Don’t shoot the messenger; less so when he is an expert and probably your last chance at survival.
- On the issue of ego and pride, the one chef refused to bake cupcakes. His response was that he had not studied years to become a chef just to end up baking cupcakes! This is a perfect example of hubris! Let the customer decide your value offering, not what you can do and not what your pride tells you to do!
- At times, they have recipes that their grandfather developed. They then cling to that for sentimental reasons. While this can be good, you need to understand that customer preferences can change over time and that you need to be sensitive to their wants and needs. And the customer is always right. Fortunately it does seem that mostly when the results show that Buddy’s views on customer preferences are correct, the chefs believe him. They experience that aha moment.
- They do not understand when their business premises do not look appealing. It reminds me of the “physical appearance” concept of the 7P’s. Your environment needs to contribute towards the marketing message! You get used to your “shoddy” setup and then do not recognise that maybe you should have changed the décor years ago.
- Understand that your business is a system. If anything in the bakery is not up to standard, it impacts the whole bakery. Everything needs to be aligned! And it frequently is not. The exterior, the interior, the product range, the product quality, the operating model, the quality of the tools, the people who serve, all should be in alignment!
- Leadership is crucial. Some of the owners are perfectionists and great bakers. However, they tend to treat their staff poorly, frequently inadvertently. They do not realise they can only be as good as the staff they use in their stores. They also do not realise that without a great employee value proposition, they cannot have a great customer value proposition. Yelling at your employees will not help. Being a product expert is not enough – you need to be a leader! Get them to be engaged employees! It is the only way. Without this, the whole system will crash – guaranteed!
- Marketing your business is crucial! You need to know how to tap into the networks to position your business and create a marketing mix that will satisfy your customers. It does mean that going out and chatting to customers and understanding their needs is crucial! As Steve Blanks puts it, you need to be out there! Without satisfied customers and a product that sells, you do not have a business!
- Be innovative! Change small things that will bring about great changes. It frequently requires nothing more than tweaking your processes, or your product range. Incremental innovation is quite useful and easy to bring about.