Prep to Profit Podcast: Building a Bread Preorder Powerhouse with Zach Martinucci

Podcast Transcript

[00:00:00] Andy Blechman: All right, amazing. Zach, thank you so much for joining today for the Bottle podcast. Really, the goal of this podcast is to help business owners like yourself, both people who are in the same stage as you, but also maybe people are just starting out or starting to think and scale their business.

Different tips and tactics for being successful. So you and I have now known each other for a number of years. I've even had the chance to come visit you in Denver and eat your wonderful food, both in your amazing kitchen space and also throughout Denver, where a lot of your product is sold. And it's just such a pleasure to have you on today to talk about a wide ranging host of subjects.

With a focus on, nailing preorders were you right before the preorder push into Thanksgiving. If my inbox tells me anything that's starting right about now I'm starting to get those emails. They started this week. And so we thought it'd be good to have a session about preordering, which you obviously have a lot of expertise in, but even more and more important is I'd love.

We both share a love of food and a passion for food and community and food communities and local food systems. And so a lot to cover today, both tactically, but also just to have a fun conversation, um, before I dig in, I always, you know, to start with kind of just a quick summary of you and your background that I'm going to give and then we'll dive in to your background.

So Zach and I first got connected right after the pandemic. Right around the pandemic, you had just launched a subscription offering and we were talking about all the ways that you could serve the Denver community. And throughout the course of that conversation, I started to learn about your background.

You run a business called Rebel Bread. It's an amazing bakery with a number of different lines of business throughout Denver. And we're going to get into all of those. What I've always found most interesting is your passion. For food, both from a personal perspective, how you've infused that in your business and how you now have been such a key part of your community as a, as, a really notable vendor in the Denver community scene food scene.

So I want to kick off with you went to an amazing school, UCLA, and there you studied culinary anthropology. Did I get that right?

[00:02:22] Zach Martinucci: Yeah, you did.

[00:02:23] Andy Blechman: And is that tell us about that. What is that? What made you like, not many young people decide that they're going to go to a school and it seems like, did you create that major?

Is it? Something that existed I'd love to hear about it. What drew you to that?

[00:02:38] Zach Martinucci: Certainly my, my degrees are in anthropology and Italian. It was a create your own, although to save us the trouble effectively, I did study food culture through food for most of my time there.

Although there is a food studies program now at UCLA, and there are lots of more food specific cultural programs across the country now. Yeah, I had just started on the path of anthropology and I'd always, I grew up in a family that loved to cook and eat, but we weren't professionals. I didn't have that background.

I love baking really terrible bread as a kid, just not knowing how it worked. Or I should say dough in general. And so I, and at UCLA, I was exposed to some courses that really showed you could study food professionally. And then I saw also like living and interning in L. A. That you could work in food professionally, and it just opened up this world that I hadn't really considered making a career out of and that you still I had the opportunity then to do a really in depth undergraduate thesis, essentially.

And so I got to live in Bologna, Northern Italy, and study culinary traditions and how identities represented through the food that people cook and eat. And getting that, really was foundational to how I see food in the world now. And so much of the inspiration behind my career, behind Rebel Bread and the other things I'm choosing to do, but it was really just the cultural piece.

And then I've gone on to get more of the technical baking and business education beyond that.

[00:04:00] Andy Blechman: And I feel like your youth and your childhood is so influential in everything that you do. So maybe I'd love to hear about. What was growing up? What was the role of food in your life?

What did that? Cause I feel like so many of us that get into this business were affected in different ways in our childhood because food played a role.

[00:04:22] Zach Martinucci: I feel really fortunate that both my parents knew how to cook and, made dinner most nights. And we always ate dinner together at the table.

I don't, I don't think they talked about it as a pillar of their parenting or anything that important other than that was the culture of what we did. My dad is from this Italian Catholic family and his parents were great cooks. They caught, they taught my Jewish mother how to cook, didn't really know before.

So she learned some of the Italian recipes and that side of the family was really good at just being intuitive. Knowing by the pinch or handful, you know how to put things together. And then my mom, while learning to cook from them really loves to follow a recipe and loves to see if she can cook anything.

If it was on the today show that morning, and she's downloaded the recipe and is going to measure out every tablespoon of olive oil that goes into a saute pan. It's really interesting to see perhaps even now I would call like the art and science that I think about in baking, but to grow up on that. And they gave me the freedom to make a mess in the kitchen.

Cooking channel had just debuted separate from food network in like my middle school years, and I just remember being so excited to have summer breaks to play around in the kitchen. And I loved making Projects like marshmallows or homemade mayonnaise or like things I didn't, realize you could make at home that I think introduced some of the, the technique that goes, not that I was great at it by any means.

Yeah, it was lovely to be able to explore the

[00:05:51] Andy Blechman: building blocks of how cooking works. Cool. And if I'm not mistaken, the Nona G sent I get that's a loaf. You inspired by your grandmother.

[00:06:03] Zach Martinucci: Yeah. So the backstory there was,

I was,

In college and then learned to bake from my dad's cousin who had opened a little French bakery near where we grew up.

And I went back to school and was baking a bunch of bread and then baking flavored loaves of bread based off my friend's personalities, which was my like anthropology tie in. And around that time, my nonna Gloria passed away, who was my Italian grandmother and culinary inspiration and role model and the Italian grandmother that you're picturing.

And I'd been baking these flavored loaves for friends. And so I wanted to make one in her honor or her memory to share at the funeral. And so I made a loaf of sourdough with everything she'd put in her Sunday roast, which was whole cloves of roasted garlic and fresh sage and rosemary and salt and pepper and olive oil and my kitchen smells smelled like hers when I baked it and the family loved it.

And years later, I made it as a farmer's market special at Rebel Bread and people really liked it. And we made it the next week. And now it's a loaf. We make every single day on our core menu.

[00:06:57] Andy Blechman: So what's been the arc of Rebel Bread? You kind of, you didn't go, I look at you. I'm like, Oh, culinary anthropology, you strike me.

It could have been, our generations, Michael Pollan maybe you still can, it seems like you had those roots. You have like an academic and real like thirst for knowledge in this space. So it's interesting to me, you became a practitioner, what. Led you to that. What was the arc?

You said you finished undergrad. I know you went to baking school. But what was your arc and how did you get into the business and kind of I'd love to hear about the early days and some of the things you felt like you did really well. And if you were just starting out again for anyone in the food business, because we have meal preppers on here and bakers and, any kind of food artisan, like what worked and what didn't in those early days, what was that early arc for you?

And then we'll get to where you are today in just a bit. Sure.

[00:07:45] Zach Martinucci: The arc, of course, I think only makes sense looking back. I think there were pieces that I saw. Maybe this will help with this, including, I decided like last month, senior year of college that I was going to go to baking school in San Francisco.

Which at the time felt way out of left field, having been in this academic environment. And actually, it was some of my professors that encouraged that as actually, this seems like the thing you're really passionate about. And perhaps like a missing piece that you don't have in your education, you wouldn't have had getting a liberal arts degree.

So I did a professional bread and viennoiserie program, which is like laminated pastries, croissants, and brioche. At the San Francisco Baking Institute and during that course, it was a course for people that wanted to be professional bakers or run a professional bakery. I realized kind of partway through that.

I wanted to try opening my own place. I'd reconnected with a friend from elementary school who had lived in Denver and had a wedding cakes bakery and was the motivation to come out and do something, in the same kitchen or work on something together. And we don't work together anymore, but was was the motivation to come out, try, I just wanted a new city and perhaps to make a bakery happen.

And I care very much about the culture and storytelling and education around food and really wanted to try my hand at having a production bakery. I'll add to a lot of my childhood, I think was really entrepreneurial looking back, wouldn't have had the word for it at the time, but yeah, I've had the opportunity right to do my own thing and grow projects and be involved in my community and lead teams of people in like a, a non work setting, but realizing how many of the skills transferred.

And so as soon as I got. Got into starting the company have really enjoyed and it was really my goal. I should say to not just be a baker, but to really grow a bakery and a business around it. And I can talk more about the early days. Like you

[00:09:36] Andy Blechman: said, yeah, let's hear it. I'd love to hear it. It's always fun to hear the startup story.

Kind of what you're in school. You realize you want to do this. You're going to, you have the undergrad degree. You have now you have the culinary degree with the specialization. What is the path? And if you were talking to a young person today who are any person doesn't have to be young, who wanted to start their own food business, what lessons learned were there from those early days?

[00:10:01] Zach Martinucci: I'll tell you what I did, and again, it wasn't linear at the time. It's gonna sound more or less linear as I tell it. But the point of it was I was really interested in starting this business. I had the Instagram and the name and probably a website and the shell of something that could be a brand, but no real physical space yet.

Although I was interested about it. You had the recipes and you had the skill recipes. Yeah. Yeah. And I should say too, I think in our industry, like all bread is the same, especially the style of like new school tartinesque baking. Like we end up choosing specific recipes and putting our own personalities and spins on the products we choose to make, but by and large, it's all the same artisan baking.

So I was working in other bakeries and restaurants just, Having jobs and getting some experience in Denver and then was in an entrepreneurship course here that my favorite exercise they had us to do was to, and it's still my favorite to recommend to people considering starting their own thing is to go out there and do a version of your business that you can do today with what you already have.

And the idea was to take what's in your garage and maybe a 100 dollars, but no more and go try it on, so to speak. And it's not going to be your whole business. The version of the final version of our business required a commercial kitchen, and I didn't have that, but I was able to make four, eight loaves of bread, like of sourdough and cast iron in my home oven at the time.

And I started doing pop up events where I would, I really liked specialty coffee shops. Being the coffee shops were like, they source or roast their own beans and they put latte art on the drinks and there's a great scene of it in Denver and I had a hunch that the kind of product I might want to sell might be interesting to people that are already frequenting those places.

And I really liked hanging out there, so I just got to know some of the managers and owners and then asked if they would host me on a Saturday morning. When you say got to know, because I

[00:11:55] Andy Blechman: think this is important. Like, how did you do that? How do you cultivate those relationships before having a pop up?

[00:12:02] Zach Martinucci: You just become a regular, right? You show up to the same place around the same time, week after week and make a point to not just Okay. Order your drink and be on your headphones or on your laptop. Like often I was working or doing something but made a point to ask the baristas names or get to know what they were interested in or what's the shop like.

Sometimes I'd even say I have I'm a baker. I have this interest in doing it. I'd even maybe come in with questions about like, where do they buy their pastries from? Or more like specific industry questions, even though I wasn't really in the industry yet. Yeah, just taking an interest in it. Cool.

So just that baseline level of curiosity and relationship building. Yeah. And honestly, the, at least in Denver, the small business community is really supportive. And I think a lot of these people got their starts in similar ways. So by the time I was wanting to do these pop ups, even just to know the owner's name and to have met them once or twice, or to feel comfortable asking for their email address was like enough to be able to make my own intro and say, Hey, what's up?

Could I come in and sell some bread? And most of the time they said yes. And I'd set up, were you

[00:13:04] Andy Blechman: licensed or did you have no business? Like this

[00:13:07] Zach Martinucci: was terribly unlicensed. I could tell you exactly how to do it now. Legally at the time, I just didn't know you needed those things. And I'm surprised no one asked like for my insurance or license or anything.

[00:13:19] Andy Blechman: Yeah. What are the things you would need if you were going to do a pop up in store

[00:13:23] Zach Martinucci: So at least in Denver you would need. To be operating out of a there are a couple of ways you could do this. You could be a cottage food baker here, and I never went through this step, but there's a program in Colorado and in many states where you essentially license your home kitchen as a production facility, but because you're not regulated by the health department, you are, you can't use all ingredients.

They essentially limit perishable things. So in baking, you have to avoid like dairy. And then you have to prepackage all your items and put a label on the packaging that has this language that says you're a cottage baker and disclose your ingredient.

[00:14:01] Andy Blechman: And if you weren't a cottage baker, because we have, I assume that's really specialized.

What would you have to do if you're just, if I was making like meals, like I used to do.

[00:14:09] Zach Martinucci: Yeah. If I were trying this on, I'd probably do the cottage baker. Yeah, that's a pretty easy way to just get going officially. If you were doing this commercially, even on a really small scale, you would need to be working out of a commissary kitchen.

So some kitchen that is licensed by The governing jurisdiction and you're renting it by the hour. You have an agreement there, like almost like a lease, but it's, hour to hour, month to month. And then that allows you to get a food license to sell food. And then you'd also need like a sales tax license and perhaps some general liability insurance, which could be like.

50 or 80 a month to start. It's not a huge hurdle, but you would need to go through the steps of what an official business needs to operate.

[00:14:53] Andy Blechman: Path A is you just hey, take a leap, see what happens. Do a pop up path B as you go through like the hurdles to like really to make sure that you follow all the regulations.

So anyway,

[00:15:03] Zach Martinucci: yeah and I'll make the distinction here because I should have done that. And if someone were doing a pop up in our space now, I would, kindly ask, do they have any of these things we'd pick the easiest option, but some kind of a regulation. But this was a marketing exercise.

Really? I wasn't intending to make a business out of selling four loaves of bread on a Saturday morning. It was more to get to know customer people that could be my customers and see what they thought of the product and the price point and all of that. Not being my friend already.

[00:15:30] Andy Blechman: Yeah. And there are probably other ways you could do that to have this.

And I think that's the, an interesting point is you started off by just seeing what the demand, like the pulse in the demand, getting to know people, understanding, like starting to maybe build your community. Were there other things on your mind in the kind of the pop up days? I guess the pop up phase probably evolved as well.

[00:15:49] Zach Martinucci: I'll tell you the story of how we got our first kitchen because it's connected to this. And I think shows how the real business world actually works. I was also in a business, then a second business planning course where I was, putting, it was called trout tank. It's like shark tank for Denver.

It's littler. And you're putting together a pitch that you could give to investors or to lenders. And then I got to that phase, but. Ultimately starting a food business. With kind of a half made business plan at age 23 was not something that like was for investors. That's not what I wanted. And that's not, it was not the most useful, but that

[00:16:24] Andy Blechman: was a local, like city sponsored thing, right?

[00:16:27] Zach Martinucci: Yeah. It was through the small business development center through the chamber of commerce.

[00:16:30] Andy Blechman: Cool. I think that's also an interesting point, like for people, even mid sized businesses, like if you aren't involved in your chamber of commerce and you aren't in, I do think that those Of course, places offer opportunities, whether it's business support or lending, there is like a reason to lean into those.

So it is a good takeaway. I think at least that's the 1st

[00:16:51] Zach Martinucci: thing. Definitely. I think a lot of us starting to think that we need to borrow money and. More often than not, the answer for that first step is actually a connection or some advice or opening some door you don't even know is there before just cash to start the business.

And I think these programs, the Chamber of Commerces are really good at helping figure out what you actually need or putting you in the room to make that actual connection rather than just saying you need a loan. And that's the answer. And I was in that boat and probably didn't know it that I needed the kitchen, but that didn't necessarily mean a big SBA loan.

It just meant where to operate to get going. So how'd you find that first kitchen? Yeah. So when I did these pop ups, I had a little email interest list, that said, leave your name in your email. If you want to know where we're going to be next. And then there, there was a third column that said your favorite place to hang out in Denver.

And I was trying to get it like other coffee shops or community spaces where then I would go down that list. And I'd write to those businesses and say, I'm starting this bakery and I'm doing these pop up events. And one of my customers says that they hang out at your location. Could I come and do an event there?

And one of them was this coffee shop in Denver that the owner called me and said, you know, I don't really, I don't really host these kinds of things, but I like meeting other entrepreneurs. I think what you're doing is interesting. So he called me in to have coffee after hours in his coffee shop.

It's 3 PM, but it's dark. And I learned that he is actually operates the. Other premier wholesale bakery. I say other before we existed the main wholesale bakery that like would be our competitor. Yeah. It was really interesting what I was doing and said, my, my buddy has this bagel shop in this five points neighborhood.

And I think he wants out, you should go meet him. It's probably a kitchen that has everything you need. And I met him that Friday and I signed a lease on Monday to move in and lease being a loose word here, but able with the few friends I was working with to take over his share of a shared kitchen that was really inexpensive and had a lot of roommates, but came with a little electric deck oven and a little planetary mixer and some tables and fridges and kind of everything we needed other than ingredients to try to do the first version of the business.

And to finish the story, I then went back to all the coffee shops where I did a pop up and said, I have a kitchen now, and I'm going to start selling pastries five days a week. Would you like to buy them? And five of them said yes. And they were our first wholesale customers. And so the business

[00:19:17] Andy Blechman: actually started with the pop up.

It started with wholesale. I didn't know that. Yeah.

[00:19:21] Zach Martinucci: Cool. And we had a little retail counter and I think had big hopes for retail for people walking in and wanting to buy from us and spend time at the bakery. But there were no seats, right? It wasn't a cafe. It's just a counter, which is honestly still what we have 6 years later and did allow us to start with this kind of steady business of knowing that we were going to have these wholesale orders to bake for each week.

[00:19:44] Andy Blechman: Cool. And I'm going to fast forward and we can come back to the path and the lessons learned, but I just, where are you today? Like, where is Rebel Bread today? What, you've obviously, and what was the time frame of this journey? Yeah, certainly.

[00:19:57] Zach Martinucci: This is fall 2018. So I'm worried that we sent out our first wholesale order last week of August, 2018.

We celebrate our birthday in October. We had this like kind of three month drawn out soft opening. So we're six years into business now, this month thank you. I now have a team of about 35 people. We serve over a hundred wholesale accounts in the Denver area. We also have a much bigger. Retail counter, but still just a counter in our kitchen.

We participate in the South Pearl farmer's market, which is one of the biggest farmers markets in Denver. And then we have a Bread Club program, which is our pre order for pickup and home delivery that we run through Bottle. That was our pandemic pivot. That's now one of, one of the core ways that we sell our product.

[00:20:42] Andy Blechman: And then you missed one or, talk about it, but two weeks ago, you just opened something new as a, as a. I'd love to hear a

[00:20:50] Zach Martinucci: little bit about that as well. We've also opened a sandwich company called Gino Panino which is started for a few reasons. The first was we started making sandwiches at Rebel, but realized it people already had their expectations of us.

They knew what their order was when they came in. They were like, Oh, sandwiches, that's nice, but I'm here for bread. And we thought this might be better under its own brand, especially as we realized we wanted to have more of an Italian menu that was going to feel off brand for Rebel, but could maybe be it's really a really cool thing on its own.

And then I'm really interested in continuing to grow what we do, but it's starting to feel like Rebel Bread might be at a kind of a maturity point, which I'm really happy about. And I wanted to grow without just always asking our team to bake more bread and make more pastries. And for as busy as we are, there are still entire hours of the day when our kitchen is empty.

And so we thought this auxiliary company is complimentary. It uses the same infrastructure. It's our team and, same ingredients supporting it, but allows us to fill some of those gaps with a new product. And is, is my trying on now of having a hospitality group where we have one central kitchen and team that supports multiple concepts.

[00:21:59] Andy Blechman: Amazing. Cool. So much to dig in and different directions to take that. One of the things we've talked about internally at Bottle that when I read the kind of the release press about, Gino Panino struck me as ingredient quality.

[00:22:14] Johnny Watson: Yeah.

[00:22:14] Andy Blechman: And I think that what we've seen. That I would impart to other food entrepreneurs is like, depending on your goals and your price point, just how important ingredient quality is and I saw where you're sourcing your meats from, for the sandwich shop and obviously the bread quality will be incredibly high because it's coming from, your bread, but I'd love to hear your kind of ingredient philosophy and then we can, cause I think that's like kind of a hidden secret that the best Businesses, the best food businesses, and it sounds so obvious, but it's also so hard to manage costs and like you have a certain price point.

So it's not necessarily you have to get the best ingredients, but the buying the best ingredients that work for your price point of your profit margin would be like a piece of advice that I would give to people. And I'm curious how you're approaching, managing ingredients for Gino Panino and also, obviously for Rebel, but you how do you think about ingredient sourcing of food quality and pricing?

[00:23:13] Zach Martinucci: I'll start with how we think about it at Rebel, because this is actually new in the last year that we've really given it this level of thought, because ingredient sourcing, and I'm going to be talking specifically about flour and butter really being the main ingredients and the standout things in what we do.

And you know, the baking program I went through, the education I had, Flour wasn't really talked about. It was we were fortunate to have this commodity. You can buy it from any distributor. It doesn't really matter. And in the last couple of years, I've gotten involved with the main grain alliance in particular in the Northeast, and it was starting to see the significance of sourcing regional grains, which has its own movement attached to it.

But in the last year now, and in the last year, we've started working with a local mill and in Boulder, Colorado called dry storage and have. And there's a lot to this, but over the course of the last year, have entirely switched all of our flower to regional grains. We have a bread flour blend. That is the base of most of what we do that sourced regionally in Utah and Idaho and Washington.

And then we're lucky to have some single varietals that are grown and milled entirely in Colorado. And it was really just. tasting it, which is how I approach everything. That's how we want customers to choose our product and to stand by it. Just trying other products made with this regional flour and be like, this is incredible.

What is this? Knowing it's the same thing we're making, but just the choice to use this higher quality. ingredient that has, that expresses it expresses the local terroir, which is like the fancy way, the academic way to say it, but that there's such a like taste of place in these ingredients that really, even if you can't articulate what it is, just stand out as a better product.

So we've made this choice. It is a more expensive ingredient. We found some efficiencies in our production that we knew would allow us to save some money in general that rather than just taking as profit, we redirected towards this choice for a higher quality ingredient and love that it supports sustainable agriculture and local economies and better nutrition through this food choice.

And we did this with, we chose to take that efficiency and that margin so that we wouldn't have to raise any of our prices because it was really important to me that we didn't make our consumers choose like a more expensive loaf of bread because they knew why it was better. But had to pick between the commodity or the local version.

We just made it our default and said, it's more delicious. You're going to love it for all these reasons, but took the choice out of it. Yeah. And so you just compressed your margins just a little bit to yes. Okay. So then Gino Panino now year after that was designed with that as the foundation was, this is not something we're going to figure out how to work in later that we're going to build a business around the fact that we're going to source some more expensive and higher quality ingredients.

And there's a philosophy piece to that I can go to, but the second time around is a little easier because it's just a starting non negotiable.

[00:26:12] Andy Blechman: Very cool. And how are you sourcing, just maybe I'd love to hear from Gino Panino, like what, how did you pick who your primary vendors are? How did you build those relationships?

What was that process like?

[00:26:23] Zach Martinucci: Yeah I, so it is an Italian inspired concept. Having studied food in Italy and just returned from Italy, I'm on a kick of my new thesis of what I believe Italian food is. And I think the point of Italian cuisine is to cook delicious, sustaining food for the people around you with the ingredients you have available.

And especially in America, I think the distinction is we're not making Italian food as in we picked this one recipe from Rome and we have to source, Guanciale to make carbonara because pancetta won't do. And I think there's this older school, like there are specific ingredients for specific recipes when those came about historically because guanciale was like more readily available to the people making that recipe.

So the inspiration then being like, we're going to make Italian sandwiches, not because we're importing a hundred percent Italian ingredients, but because the philosophy is we're going to pick really high quality things close to home as best as we can, that will express that will be the best. They will be better than something we could import or pick from elsewhere.

Just because they're. They're fresher and great quality and the ingredients all go together because they're made here. So the flower for the bread is Colorado and or regional. We're sourcing greens from local hydroponic greenhouses, which is great because we can get them year round and are just if you haven't had, your local green compared to what's in the supermarket it's an entirely different product and they last a long time and travel really well.

Cheeses are just what we can find right now. There are some Colorado cheese producers, but they're not really at a level that we can buy steady wholesale. And then our meats are actually all coming from California from and from Prime Roots the second one being a vegan Koji culture based like plant based meat alternative.

Both are being made to really exceptional like artisan standards and sourcing great quality pigs or. Mushroom culture that, and that's it. That that's what's in some spreads, which are also tend to be local businesses or smaller businesses. And so you get to taste, each of those ingredients individually, which is really why they stand out.

[00:28:26] Andy Blechman: Oh, I'm dying to come to Denver and have a sandwich. Um, that's so cool and super interesting. I think that everyone has a different way they want to run their business, but I do think being super thoughtful about quality in relation to margin and prices a table stakes. For any business owner in the food space.

Let's pivot because I know there are a lot of people on here who want to learn about subscriptions and pre orders and how to be successful, which we've seen you be super successful in that space. Maybe you can tell us about your journey into Bread Club and how that has evolved. Bread Club is your subscription offering how that's evolved.

Not necessarily the bottle piece, but more just the business piece how is that? How is that? As a part of your business evolved, and then maybe we can segue into what are you thinking about as the holidays come? How do you think about pre-orders?

[00:29:13] Zach Martinucci: Yeah I think a theme of just what I think has made us successful or what I see as like a key component to successful business, our style is that you set your own terms as a business that is you make.

Products that you can stand behind that, you're going to do a great job at as a bakery. It's, people love to come in and love our bread and love our pastries and say but could you make this pecan pie? This is my grandmother's recipe. It means so much to me. There's usually an emotional component to it.

We could, it's not that we don't know how to make pie. However, we've really set up our company to specialize in this one thing. And pie would be a distraction. It's not what we do. There are other places that do it well. And so while it's flattering over the years, we've learned to say no, essentially to so many things because we care about doing a product that we're really good at, again, without being distracted by other things.

But I'll say the terms also come into all the logistical details, too, as in we close our orders 3 days ahead of time for our preorder both wholesale and retail customers. We think about them similar our choice to do so much wholesale business as well as to have a preorder subscription or one time order program because again, we close the orders early we deliver during certain delivery windows, Those choices mean that it's not for everyone, right?

It's not the most convenient process necessarily. Not everyone knows they want bread three days in advance or whatever it is, but because we've set those terms and communicate them very clearly and make sure our customers know like, if you want to buy from us, this is how we do it. We're able to then deliver on those expectations.

The majority of the time. And I think that makes for such a better experience for our customers that, we've laid out what we're going to do, and then we do it really well because we're doing it on our terms.

[00:30:59] Andy Blechman: So how did Bread Club evolve? You mentioned it was your pandemic pivot, but walk us through the offering and how it evolved and what you think has made it successful.

[00:31:09] Zach Martinucci: BreadClub came we started pre pandemic actually, out of that hunch that the people that are going to specialty coffee shops might also want to take home a loaf of bread. And rather than the coffee shops having to sell the bread themselves, could we set up a little bread rack and just have it be where people place an online order through us.

We're going to deliver it to this community location, this coffee shop, and then they'll take it home. And I think we had a couple breweries to start actually, because we wanted more evening opening hours. And we had 15 customers across Denver at three delivery locations or something absurd that just didn't make sense.

And I'll say, I didn't really know what we were doing with it. And then the pandemic hit. So we'd moved into this new kitchen in January, 2020, where we didn't have any retail space. So we were entirely wholesale save for being able to do like Bread Club drops. And then all 90 percent of our customers were mandated to close in mid March with the closures.

And that was on a Monday. And we laid off all of our staff save for like, a manager and didn't know what we were doing and then posted online that we would do orders for home delivery for retail customers. And we'd had some of the infrastructure already for Bread Club. But just made it from local pickup to home delivery and then people were at home, not sure what to do of the 1st, few days of the pandemic and looking to support small businesses.

So we're really fortunate that a bunch of people placed online orders and we brought our staff back a day at a time to fill those orders. And then we were in a farmer's market that summer and were able to bring back everyone that wanted to work within a couple of months. But we just, the pivot really was from local pickup to home delivery.

And we had to learn how to be a logistics company, manage routes and send out drivers. We did all the driving for a little while and then coming out of the pandemic, which is actually around when we found Bottle, right? Because we realized we wanted to make this a program that didn't just feel like a pandemic response, but actually stood on its own.

If people still wanted delivered bread. Or a pre order offering. And so with Bottle, we were able to offer a much better store experience. And we'd had customers that had subscribed already that wanted to subscribe, but weren't given a great, like interface option before. And now we're able to really set up some kind of plan that worked for them.

They knew us and our product and our quality. And so the later development really just became about how do we get this to them in a way that really works for customers?

[00:33:35] Andy Blechman: Awesome. And what do you think what has worked in that business? What are some tips or tactics you've seen work on the on building like this home delivery business?

[00:33:45] Zach Martinucci: Yeah, I think consistency is such a big part of bakery success in general and what we do for a lot of those customers, we don't really touch our bottle store. We don't touch Bread Club very much. It just has our core menu all the time. And I'll say that it has some really wonderful features to promote specials or to change things over to alert customers of fun things that you're doing.

And that's just on us for not having invested in that piece of it. But the part that we, we do run is just the day to day. Here's our core menu and customers know that they can place an order and always get the same things. And a lot of our subscribers, I think just really love that they've set up a plan for themselves.

They want two loaves of sourdough delivered every week or whatever it is, it's a staple in their household. And knowing that they can get that consistently has made for some really engaged customers.

[00:34:32] Andy Blechman: And what's your PR marketing strategy around Bread Club? Cause it's pretty like you've you're.

You've got a lot of press.

[00:34:39] Zach Martinucci: Yeah, we, it's, excuse me, I'm stumbling. It's changed a couple of times. I'm realizing in the pandemic too, we were, and this is pre bottle, which is probably why it was such a mess. We wanted to offer our platform for other bakeries as well, or local vendors, but I think they're mostly bakeries.

We had maybe five different brands on Bread Club at one point. Yeah. With the insight that we've already done the legwork of setting up the logistics and finding customers. That's not really what bakeries want to do. Could we provide an opportunity for other bakeries to just sell with us and we'll handle those logistics.

And so our initial and that was when Bread Club became its own concept. That was separate from just Rebel Bread. We did a lot of PR around that. I should say all of our PR is truly just local community focus. It's local papers. It's local broadcast segments. We've seen the most success in that over a digital marketing and we're not an e commerce company, really just getting our name out in the community among real customers.

It's almost just like a souped up word of mouth as has been the most effective, I think, in, in bringing people to our programs

[00:35:42] Andy Blechman: and in terms of the local PR, do you have, did you do it yourself? Do you have someone help you?

[00:35:47] Zach Martinucci: Yes, we do have a PR agent who, who specializes in. PR for Denver particularly in like small businesses and a number of food businesses as well.

We've grown with Jess and she want we met her in the first year of her business as well. So it's been fun to see her take on more work and have these community connections. I don't know that the technicalities of it then, but having had this relationship for a number of years now, it does just seem like it's the persistence of.

Making community media connections and following up with them and keeping whatever you're working on top of mind. And at least our local press is usually pretty interested in covering local bakeries. We get, a few times a year we're able to run something we've changed enough that it's interesting again for people to write about.

[00:36:29] Andy Blechman: Really cool. We've talked a little bit about pre orders and subscriptions, but the part we haven't hit on yet is the logistics. So you mentioned or hinted towards, you set up all you, you figured out the logistics piece. So what does that look like? Like how do you guys manage logistics for the, that home delivery side?

And what are like the different pickup and delivery options for members? And how are you currently thinking about managing? That piece of your business, not including the wholesale side, which we can get right in a second. But

[00:36:57] Zach Martinucci: no, and it's I'll say the ways to make it successful is more or less the same, right?

The highlight between successful wholesale and pre orders and subscriptions for retail is we communicate effectively and proactively. And we deliver what we say we're going to deliver, when we say we're going to deliver it, and that it is consistent to week. And I'll speak to each of those, but I'd say that's probably, that's what it, that's what makes it work.

If you go to our store as a prospective Bread Club customer we have home delivery and pickup options set up. Home delivery is where. You enter your zip code or you enter your address and it tells you if you're eligible for delivery. And then we just deliver on Thursdays, more or less.

It's in North Denver and on Fridays in South Denver, roughly we currently work with delivery contractors. So it's another local business that runs deliveries for small businesses. They do all of our overnight wholesale deliveries and then their company also, and it's just a couple of people.

But they also do all the home deliveries. We, excuse me, I'm getting ahead of myself on like the flow, but we plan the routes for them, but I'll say they're experts at it. They know most of the customers that are, recurring orders at this point. So we just leave that to them, but we've also done it in house where we just get in our car and do it.

And it, it can be done given that you have all the right delivery notes and route planning and all that.

[00:38:14] Andy Blechman: But you found that outsourcing it and just maybe it's a little bit more expensive, but the economics kind of line up and just makes it so much easier for you. Is that? Yeah, it is

[00:38:24] Zach Martinucci: a little more expensive.

Depends how you look at it. I guess the investment now is we, this company is experts in the actual fulfillment. We have to maintain a relationship with them and help just really be great partners in this to make sure that the work we're providing them and the way that they're doing it is going hand in hand.

They don't work for us directly. It's different than an employee relationship. So we have less control over it, but they are professionals in what they do. And they've taken, we don't have to be experts anymore on the fulfillment piece.

[00:39:02] Andy Blechman: Yeah, I can see both sides of that. And as long as they're like delivering the product in a way that you feel like feels good to you, then that if you're, it obviously relieves a lot of burden when I ran my meal delivery business, we outsourced as much as we could and it was super helpful.

Just a few more topics here and it's been really fun and. Really enjoy hearing your story, but I'm curious, thinking about real estate and kitchens and, how to think about kitchen space. Like, how has your philosophy evolved? And, how have you thought about kitchen space?

How has the production space that you've worked out? Out of also evolved. You started subleasing from the bagel guy, how did that process evolve and how do you think about kitchen real estate today and what you're trying to do with your own kitchen and kind of, I'd love to hear the status of your kitchen as well.

[00:39:51] Zach Martinucci: Of course. Yeah. So we opened in the shared kitchen. It was like. 1500 square feet, this long, narrow train car of a space that had enough, but wasn't, very efficient for what we were doing. And we were there at about a year and a half and we're outgrowing it and then move to where we currently are, which was an old culinary school.

There were 5 former teaching kitchens in this building that had equipment. Some a lot of it broken. But. It had the infrastructure and tables and small wares and some bigger equipment like ovens and walk in refrigerators that we could repair or use for a while. All that to say. This was a lease.

This was a lease. Yeah. And then we ended up taking a second kitchen in that building last year. So we now have two former teaching kitchens. That's about 2000 square feet of kitchen space, which is so much kitchen space, except that it was designed for teaching, not manufacturing. So had we built the whole thing, it would have, it could be much more efficient.

We could take half the amount of space with bigger equipment and get the same work done. The trade off instead is we've never had to build and furnish an entire bakery. It's just not designed to be the most optimal, wholesale for what we do, but has allowed us to grow into it gradually. And I know it's unique, but I've also heard of other, at least here in Denver, some other businesses that have found second generation spaces or something that used to be something else like a culinary school.

Now it's a commercial kitchen that has more or less what you need. And they're not listed in the same. You can't just go. Browse furnished kitchens like you could other real estate. It is a little bit more word of mouth like we talked about in that first story. But I think the opportunities are out there.

If you're willing to just knock on doors

[00:41:31] Andy Blechman: see what are the, I assume that the least terms on that kind of like 2nd, use space or just because you're going to have to do some. Improvement are just fantastic. At least relatively fantastic versus something that's

[00:41:45] Zach Martinucci: out, the rent is expensive for what it is, but that being said, it includes all the equipment just depends how you want to look at it.

And it's pretty central in Denver. It's not really in a walking area. It's an office park. It's more of a destination to get to so a little off the beaten path, but also really convenient for our staff and our customers. There's parking. There's, it's great. Once you know where you're going, we're, we've just signed a lease for additional space in our building or 5000 more square feet.

Which will be about 1500 square feet of a retail cafe. We've never had an actual cafe and coffee shop that will also be home to Gino Panino. Now that we have a breakfast and lunch program, we'll have a designated teaching kitchen. We haven't talked about it, but we host some events just behind the scenes baking and then baking classes.

We just try to make time in our kitchen and never seem to have enough space or time. So we're excited to have somewhere designated for that. And then an additional production kitchen as well. Mostly for sandwiches as well as for some fulfillment needs that we don't have room for in the current kitchen, some offices and storage.

And so the way we're looking at this is I guess you could say it comes down to revenue per square foot or that's yeah, that's been given to me. This is a really interesting project because it's 5, 000 square feet, but only about a thousand square feet is going to be a kitchen that actively supports the sandwich company that's going to make most of the money.

The retail counter we hope will be really busy, but in comparison to everything else we do, retail is a small part of our business. And I like it that way. Like we've designed it where if we can make consistent money off of wholesale, then retail can be for fun. And that's more on our terms again of we want to set the hours and offer what we want to offer and not feel like the success of the business is dependent upon a certain amount of covers every day getting people in here.

It's just very different that not that's a bad way to do it, but we would approach this differently. If we were paying for a really small, expensive piece of real estate, but in a great location where we were really designing the business for walk in traffic. But that's not how our business works.

So we, we look at it a little bit differently. I hope

[00:43:53] Andy Blechman: that's that answers the question. That's cool. Yeah, no, I think and for me the vision I had in my head or what I've been thinking about is you're really starting to build a food destination. And you've now, at least from the article I read online, it sounds like you've got the sandwich shop, the retail you have some online, some in person classes, like you're taking the space that you're leasing and really starting to evolve it to really fit your brand. And that was my takeaway too, that you've been very thoughtful about how you think about your production space and and how you acquired it and where it is and so that, especially when I visited in Denver, it felt a really thoughtful process for acquiring space. Awesome. And I guess like we can end it. There's so much to talk about, but we're almost at time and I'd love to end it talking about wholesale to the extent that you're comfortable. A lot of our vendors are consumer mostly again, some bread, some meal prep.

And so if you were starting to think about building a wholesale arm of your business and. Just to summarize what you've said, like wholesale does provide a lot of flexibility on the retail side and then on the Bread Club side. But if you were starting to think about any kind of food business, starting to think about how can wholesale drive revenue for me, what are some of the lessons learned or some of the things that you've observed having built a wholesale, bread business?

So

[00:45:15] Zach Martinucci: when we opened, we had both, right? We were wanting to welcome retail customers. We also had some wholesale customers and came to find pretty quickly that we really loved working with. Wholesale customers, because they were other small businesses that were like minded. We very much view them as partners and that we're looking out for one another and want to offer a great product that they're going to be excited to sell as well.

And that it was a much more meaningful relationship and not to say that we don't care about our retail customers, but people have all their opinions about what you're doing. And someone coming in once a month to buy a loaf of bread and feel very strongly about what you're doing versus also a partner who's spending a thousand dollars a week in bread.

We care very much about making something that is a good product for them. And again, not that we don't care about the retail customer, but it just puts it in this perspective, like this really matters to our business. And so we really want to work with our wholesale customers and we get to, because there, there are fewer of them, and they're using the product in a similar way. As we've grown, we've seen that in addition to the product quality, and if you're considering adding wholesale, like you probably have a great product that people really love and would do great in other people's pastry cases or store shelves or whatever it is that you're selling.

But in addition to the product, I'd say just as important is that we are effect or really excellent communicators and that we have all the delivery fulfillment logistics worked out and that we're consistent. In our product, both like the actual today's croissant is the same shape and size as yesterday's croissant, as well as you get everything that you ordered delivered on time every time that you order it.

Cause that really matters to our wholesale customers more than just the product itself. And those are the things we've really invested mostly in, in the staff that we've hired and the systems we put into place in our business to really support that level of Consistency and customer service that you probably just wouldn't have to do to the same effect anyway, if you were only serving retail customers, and what has been the go to market strategy on your wholesale side?

So we, we have a sales contractor we work with who's worked with us and worked for herself. And Ashley is just a really core part of our team, but essentially the way this works is rather than hoping people come in to our bakery or doing marketing so that people will come in, we get to go out and make sales.

So we go introduce ourselves very much like how I did in the early days. A lot of it's just relationship based. It's going to get copies somewhere to learn who's in charge and what kinds of things do they value as a company. And then setting a sample meeting, right? This is our sales process of saying, we have a product that we think could be a great fit for your cafe.

Usually there are, there are maybe three or four reasons I could think of why a customer would be interested in working with us. And they're not all going to care about all four. One customer might really care about the product quality while another is really just concerned that it's delivered on time every day.

And because we're part of the sales process that we're initiating, we get to really lean into highlighting that and showing them how we're. How we're solving a problem. I think it's silly sometimes to think of a bakery as like a business that solves a problem in the world.

[00:48:25] Johnny Watson: Yeah.

[00:48:25] Zach Martinucci: But from the sales perspective, at least, we do want it to feel like it's a good fit for customers.

And we can do that as many times as we want for as far as we're willing to deliver.

[00:48:33] Andy Blechman: And then I guess we'll close it off with are you guys do you have any strategies around the holidays? Do you do any holiday preordering or have any tips for people as they think about setting up holiday stores?

[00:48:44] Johnny Watson: Yeah,

[00:48:45] Andy Blechman: what kind of what are your thoughts on having a successful Thanksgiving and Christmas or Thanksgiving and winter holiday?

Presale program, we do a big

[00:48:54] Zach Martinucci: Thanksgiving bake and do very little for Christmas. Honestly, we're not a cookie bakery for Thanksgiving though. So I'll say that the reality of what we do is we're a fresh daily product, so we can't stockpile the week ahead of time to have a big Thanksgiving inventory.

Our Thanksgiving presale is limited by how much we can make on Tuesday. for Wednesday before Thanksgiving. And so the production capacity is a really important consideration for us. And going back to that, like setting our own terms, we talk to our bakers and say, who's going to be here and how much can we bake?

And if it's this year, it's 350 loaves of sourdough. And then we have to think about where they're being sold. So for a retail bakery, that's probably your pre orders. And then you also have this channel that is, we want some product available for the day of for people to walk in and be able to get products, even for our pre order customers to walk and get their order and say, Oh, I forgot.

I need one more loaf of bread and to have something available for them. And because we have wholesale as well, we have this third category that is of the sourdough that are available. We have to make sure we have enough for our wholesale customers, and then know how much is going to be left over to set in our pre order inventory, and then also make sure some is left for the retail.

So just juggling that inventory. I'd say this, the earlier you can get a start on that the better. And even though we deal with this every day, this scale is really unique. We're not really practiced in doing this big of a fulfillment day. And so just to leave slack. In your system, maybe close your orders a day earlier than you think you need to give yourself an extra day to prep, bake a few extra loaves in our case that you haven't pre sold because there might just be some hiccups you're not used to seeing in this kind of unique sales day.

And what what do you do on the marketing side for your holiday pre orders? It's all social media. It's texting all of our subscribers that, order from us through bottle week to week and say, here's our presale. We open a separate store in bottle from our day to day Bread Club for holiday pre orders that allows us to manage that inventory and logistics really easily as this separate day, again, from what we're used to doing.

[00:51:01] Andy Blechman: Very cool. Yeah. The amazing Zach Martinucci.

[00:51:05] Johnny Watson: Thanks for

[00:51:06] Andy Blechman: having me. So fun to have you on. Just awesome conversation. So thank you so much for joining us. And I'm sure people will email in questions and we'll have questions along the way. I think we hit a lot today I'm going to end it there.

Thank you so much. Hope you have a great holiday season and I'll finish this off with congrats. You recently got married, so congratulations and hope you have a wonderful rest of your day. And yeah, excited to hear more as your business evolves.

[00:51:31] Zach Martinucci: Awesome.

[00:51:31] Andy Blechman: Thank

[00:51:31] Zach Martinucci: you very much. Happy holiday season to you too.

[00:51:34] Andy Blechman: All right. Thank you. Take care. Thanks everyone.