Speaker 1: Hey, this is Tim. We're on vacation this week, but
Speaker 1: the Crash Course team wanted to reair an episode we
Speaker 1: had fun making about a small business in my hometown.
Speaker 1: We published this episode around the third anniversary of the
Speaker 1: initial COVID nineteen lockdowns back in March, but the holiday
Speaker 1: season is the most important time of year for small businesses,
Speaker 1: so it feels fitting to share this episode again. Now,
Speaker 1: thanks for listening, and happy holidays. We'll see you next year.
Speaker 1: Now here's the show. If you're ever invited to visit
Speaker 1: a bakery at four o'clock in the morning, I highly
Speaker 1: recommend you do it, but here's a warning. You might
Speaker 1: get put to work. I can handle those, okay, I
Speaker 1: can handle those, all right.
Speaker 2: And you just dip it in. You just don't want
Speaker 2: it to get like too much of a globby math,
Speaker 2: so you just sort of like there and.
Speaker 1: One of these called strawberry sprinkle donuts.
Speaker 2: Strawberry sprinkle donuts.
Speaker 1: Amazing, Okay, I'm now I'm gonna dip a bunch of
Speaker 1: donuts into strawberry glaze and then put sprinkles on.
Speaker 3: Top of it.
Speaker 1: That's my duty for today. However much I enjoyed my
Speaker 1: brief internship as a baker with Amy. That wasn't the
Speaker 1: main event for me. I was there to talk to
Speaker 1: the bakery's owner, Rachel Wyman, and she came bearing treats.
Speaker 2: You want to be ruined for the rest of your life?
Speaker 1: Yeahs ruined me for the rest of my life. Oh gosh,
Speaker 1: a hot blazed donut.
Speaker 4: Wow.
Speaker 1: I have literally a hot glazed donut that was just
Speaker 1: put in my palm on a piece of wax paper
Speaker 1: that looks like Nirvana. And I'm gonna go ruin myself
Speaker 1: for a minute because Rachel invited me to do that,
Speaker 1: and I'm gonna have this donnu. Welcome to Crash Course,
Speaker 1: a podcast about business, political, and social disruption and what
Speaker 1: we can learn from it. I'm Tim O'Brien. Today's Crash
Speaker 1: Course small Businesses versus the Pandemic. Three years after the
Speaker 1: COVID nineteen lockdowns, I invite you to think back to
Speaker 1: those early days.
Speaker 2: COVID nineteen can be characterized as a pandemic.
Speaker 1: All but promises that the coronavirus will spread. Here today,
Speaker 1: I am officially declaring a national emergency.
Speaker 5: Only essential businesses will be functioning.
Speaker 2: All businesses will need to shut down.
Speaker 1: Remember when practically overnight it seemed that every shop closed
Speaker 1: its doors. You remember how all of those small businesses
Speaker 1: you might have taken for granted, the ones that gave
Speaker 1: life and an identity to your community, suddenly felt essential
Speaker 1: to you. I sure do. Montclair Bread Company was one
Speaker 1: of those shops. For me. It's souredaugh bread was a
Speaker 1: staple on my family's dinner table, and it's maple bacon
Speaker 1: donuts are the best in the world. As I watched
Speaker 1: lots of small businesses in my small town in New
Speaker 1: Jersey struggle, I didn't want the bakery to disappear. I
Speaker 1: didn't want any of those stores to close. So I
Speaker 1: started writing about them in their fight, just a few
Speaker 1: businesses among tens of millions across the country that faced
Speaker 1: an existential crisis because of COVID nine nineteen and I
Speaker 1: started with Rachel Wyman, the owner of Montclair Brett. I
Speaker 1: learned that she'd overcome so much a bad marriage, a
Speaker 1: terrible bike accident, and money problems. Yet she found the
Speaker 1: strength to leave her husband and raise her three children
Speaker 1: on her own. And even though she had very little
Speaker 1: Rachel chose just about the riskiest career you could imagine
Speaker 1: the small business owner she had Moxie. I kept in
Speaker 1: touch with her and watched her take on the trials
Speaker 1: and tribulations of the pandemic threw at her. What I
Speaker 1: didn't understand when I first got to know her back
Speaker 1: in twenty twenty was that I would end up following
Speaker 1: her journey for nearly three years through an unimaginable public
Speaker 1: health and economic crisis. This is that story.
Speaker 2: You know. I've been thinking about this so much recently
Speaker 2: because you know, we're coming up on the anniversary of that,
Speaker 2: and all these pictures are popping up from February twenty twenty,
Speaker 2: like me and the kids, and it's like, God, we
Speaker 2: had no idea, we had no clue what was going
Speaker 2: to happen in just a couple weeks.
Speaker 1: When you're looking at those pictures, are you looking at
Speaker 1: like the faces of people on the deck of the Titanic?
Speaker 2: Yes, yeah, exactly, I am. And I think, you know,
Speaker 2: I still think that I suffer like PTSD from that
Speaker 2: from twenty twenty, and I just can't let go of
Speaker 2: a lot of things that happened during that year. As
Speaker 2: you know, an essential service worker. It's been really hard
Speaker 2: for me to go back to you know, status quo.
Speaker 1: Before we hop back in time to the early days
Speaker 1: of the pandemic, we should probably hop a little further
Speaker 1: back in Rachel's story so you can understand how much
Speaker 1: was on the line for her. She's earned everything she has.
Speaker 1: Rachel grew up with little money in rural Maryland, worked
Speaker 1: her way through school, and fell in love with bread
Speaker 1: and pastries. After a state in France, she went to
Speaker 1: the Culinary Institute of America, baked with some of the
Speaker 1: biggest names in the bread business, and then decided to
Speaker 1: go off on her own. She started by giving away
Speaker 1: bread to moms in her yoga class, and then tried
Speaker 1: breaking in through local farmers markets. Then one of those
Speaker 1: moms told her about a local bakery for sale.
Speaker 2: I pitched it to the moms who had been picking
Speaker 2: up bread at my apartment, and they gave me the
Speaker 2: money that I needed to get going.
Speaker 1: So your seed capital were your moms, Yeah, yeah, moms
Speaker 1: who were coming off for bread exactly?
Speaker 6: And how much did you raise for me?
Speaker 3: Yeah?
Speaker 2: I was gonna say, when we're talking about seed capital,
Speaker 2: forty thousand dollars total is what.
Speaker 6: I had on day one.
Speaker 1: This was back in twenty twelve, she juggled launching her
Speaker 1: own shop while still working for another bread company full time.
Speaker 2: So the only day of the week that I had
Speaker 2: to focus on my bakery was Sunday, and that's when
Speaker 2: I would like test recipes and try out new things
Speaker 2: and make food for the staff.
Speaker 6: And we made donuts one day.
Speaker 2: And they were gone in a second, and we did
Speaker 2: a light bulb go off. Well yeah kind of, I'm like, wow,
Speaker 2: that's great, Let's do it again next week. And so
Speaker 2: every Sunday we made donuts and the lines got longer
Speaker 2: and longer and longer.
Speaker 6: And then it became a thing. Then it was a thing. Yeah,
Speaker 6: I mean the donuts saved the business.
Speaker 1: Rachel was on the map. It was time to cut
Speaker 1: the parachute strings. After two years, she quit her other
Speaker 1: job and went all in at Montclair Bread Company. She
Speaker 1: had found her place in the world doing what she loved,
Speaker 1: and she was good at it, like really good. And
Speaker 1: others began paying attention.
Speaker 2: The town starts noticing, the press starts noticing, I'm getting
Speaker 2: all of these accolades, get to go on a food
Speaker 2: network and in the New York Times, And the better
Speaker 2: it gets.
Speaker 6: On the outside the harder it gets.
Speaker 1: At home, she was consumed with self doubt.
Speaker 2: So even though everyone else thinks that I'm this like
Speaker 2: rock star, I think I'm like the worst mother in
Speaker 2: the world.
Speaker 6: And you know that I can't run this business, and
Speaker 6: that I've you know.
Speaker 2: Ruined our family life and had all of these things,
Speaker 2: and it was awful.
Speaker 6: It was awful.
Speaker 1: Rachel decided she wanted a divorce, but had a hard
Speaker 1: time actually leaving her husband. Her landlord also kicked her
Speaker 1: out of her bakery, and then she got into a
Speaker 1: bike accident while training for an iron Man triathlon, shattering
Speaker 1: her pelvis.
Speaker 2: It was always something like that, anytime we got a
Speaker 2: little bit ahead, there'd be.
Speaker 6: Something like that that would pop up.
Speaker 2: That would you know, And yet you overcame all those yeah, yeah, yeah.
Speaker 1: Rachel found a new home and finally left her husband.
Speaker 1: She was a single mother working crazy hours, but Montclair
Speaker 1: Bread was able to move to a bigger, nicer building
Speaker 1: around the corner, a renovated industrial space full of big
Speaker 1: windows and spectacular brickwork, and of course, there was a
Speaker 1: smell of baking bread. In addition to finding a new
Speaker 1: home for her business, Rachel's body healed, though doctors told
Speaker 1: her she would never be able to run again. She
Speaker 1: clocked her best marathon time ever in the fall of
Speaker 1: twenty nineteen, just a year after her accident. I was
Speaker 1: on top of the world when COVID hit, and hit
Speaker 1: it did.
Speaker 2: At the beginning, I believed it was only going to
Speaker 2: be two weeks.
Speaker 1: Think all of us did, remember fifteen days to slow
Speaker 1: the spread. Now I think, how were we so naive?
Speaker 1: While other businesses were closing shop, Rachel was determined to
Speaker 1: stay open, even if she was the only one there.
Speaker 1: She'd been forced to lay off twenty of her employees,
Speaker 1: and without that extra help, she had to work around
Speaker 1: the clock.
Speaker 2: I worked eighteen hours. I went home, I slept in
Speaker 2: the clothes that I worked in. I got up and
Speaker 2: I did it again. And it's the same time that
Speaker 2: people are on social media talking about how they make
Speaker 2: their partner who works at a hospital, you know, leave
Speaker 2: their clothes in the garage and come it. And I'm like,
Speaker 2: I haven't changed my clothes and days.
Speaker 1: Rachel lost big orders and had to cut lucrative items
Speaker 1: from her menu, but she was also scrappy and got creative.
Speaker 1: She sold groceries and meal kits and diy baking packages
Speaker 1: out of the store, and the community rallied around her.
Speaker 2: I baked and sold more bread than I've ever baked
Speaker 2: and sold in my career because people couldn't get it
Speaker 2: at the grocery stores, so they actually bought bread from me.
Speaker 1: So you sort of had a little boomlet early on. Definitely,
Speaker 1: Definitely she kept going, but it was a lot.
Speaker 2: I really didn't think that I could sustain it.
Speaker 1: Did you think it was going to kill you? Did
Speaker 1: you think the pandemic was going to kill you?
Speaker 5: Yeah?
Speaker 2: I did. I just reached my breaking point so many times,
Speaker 2: and I just would sit there and not know how
Speaker 2: to do it again tomorrow.
Speaker 1: She wound up doing what more than five million other
Speaker 1: small businesses did. She looked to the federal government for help.
Speaker 1: You know, everybody winds about government spending until they need
Speaker 1: help when there's a hurricane or of flood. Who you
Speaker 1: going to call when there's a massive economic contraction like
Speaker 1: there was in two thousand and eight. Who you going
Speaker 1: to call when there's an unprecedented economic meltdown combined with
Speaker 1: the historic public health crisis? Who you going to call? Yeah? Washington.
Speaker 7: So what did the federal government do? The federal government
Speaker 7: acted quickly, and it made a program which put cash
Speaker 7: into the hands of small business owners.
Speaker 1: That's Karen Mills, President Obama's first leader of the Small
Speaker 1: Business Administration. She's describing how the Trump and Biden Whitehouses
Speaker 1: ultimately channeled nearly one trillion dollars to small businesses. The
Speaker 1: main program was an essential, well intentioned, yet chaotic scramble
Speaker 1: known as the Paycheck Protection Program.
Speaker 7: I never thought i'd see the day where three hundred
Speaker 7: and fifty million dollars was in the same paragraph as
Speaker 7: the word SBA. But that's how much money was in
Speaker 7: the first trash of PPP that lasted about two and
Speaker 7: a half weeks.
Speaker 1: That time, and funding went by in a flash, especially
Speaker 1: for people like Rachel.
Speaker 2: Of course, at the time, we didn't know there was
Speaker 2: going to be a second round of funding, so the
Speaker 2: funding was gone, and how did that feel?
Speaker 1: Defeating oversight and management of the PPP effort was slipshot.
Speaker 1: Treasury Secretary Steve Manuchin, who engineered the effort, was reluctant
Speaker 1: to be transparent about the process, even when he was
Speaker 1: specifically asked about it during a Senate hearing in May
Speaker 1: of twenty twenty nearly two months after the legislation providing
Speaker 1: for PPP was passed. Here's Senator John Tester of Montana.
Speaker 8: When can we see full information about who's getting the dollars?
Speaker 3: Well, let me just comment. When we negotiated this bipartisan deal,
Speaker 3: we agreed to unprecedented transparency, So we agree to release
Speaker 3: things that are not required by thirteen to three. So
Speaker 3: I don't know why you haven't seen that. We've everything's
Speaker 3: posted on our website or the Fed's website.
Speaker 1: They went back and forth a few times. Are you
Speaker 1: sure the information is there? Yep? It's there. Are you
Speaker 1: sure yep? The Tester wasn't buying it.
Speaker 8: I look forward to seeing that list, by the way,
Speaker 8: Secretary Mansion, and I'm going to go online and I'm
Speaker 8: going to search it because I'm going to tell you
Speaker 8: that as much transparency as you said, are with this program,
Speaker 8: as a center from Montana, as a member of the
Speaker 8: Banking Committee, I'm not seeing any of it.
Speaker 1: Quite frankly, it wasn't clear exactly who was getting the
Speaker 1: funding or how it was being used. Rachel couldn't get
Speaker 1: PPP money the time it was offered, and she watched
Speaker 1: her application stall online. She ended up applying for a
Speaker 1: loan four times before she finally got some money one
Speaker 1: hundred and five thousand dollars. It saved her business and
Speaker 1: then some.
Speaker 6: For the first time in history.
Speaker 2: January twenty twenty one, we officially were one hundred percent
Speaker 2: debt free Love Her Bread Company. We paid off all
Speaker 2: of our investors, We paid off any debts that we had.
Speaker 2: You know, we got a good staff and everything. It
Speaker 2: was just like, all right, We're never going back there.
Speaker 2: We will never be back in this place again where
Speaker 2: we have so much debt on the business. Like it
Speaker 2: feels too good to get ahead. What do we have
Speaker 2: to do to stay here?
Speaker 1: She started off January twenty twenty one on a new foot,
Speaker 1: and there were reasons to think the end of the
Speaker 1: pandemic was in sight.
Speaker 2: I got my vaccination on January sixth, twenty twenty one.
Speaker 2: I was one of the first because at the time
Speaker 2: there was a windowwhere anyone who was working in the
Speaker 2: service industry in front of people could get in.
Speaker 1: Did the vaccines feel like sort of a God send
Speaker 1: to you when they came along.
Speaker 2: Yeah, it definitely just felt like relief because there were
Speaker 2: just so many unknowns. No one knew when it would end,
Speaker 2: how it would end. I don't think it has ended,
Speaker 2: but it just felt like there was progress.
Speaker 1: And the vaccines gave you a sense of control over things,
Speaker 1: or more control.
Speaker 2: Than you had I ever feel, yeah, or you know,
Speaker 2: it's just like that peace of mind from having that
Speaker 2: PPP loan, you know, sitting in our account as a buffer.
Speaker 2: I think the vaccine was that same piece of mind,
Speaker 2: like I guess some level of protection.
Speaker 1: That peace of mind was nice while it lasted. When
Speaker 1: we get back from the break, I'll take you through
Speaker 1: year two of Rachel's experience during the pandemic twenty twenty one,
Speaker 1: and the big idea is she had to grow her business.
Speaker 1: That's next. The story of Rachel's twenty twenty one might
Speaker 1: actually start back in twenty twenty, when Rachel was so
Speaker 1: burnt out that she decided to close Montclair Bread for
Speaker 1: two days and rent an airbnb in New Pulse, New York.
Speaker 1: She knew the area well from when she went to
Speaker 1: the Culinary Institute of America nearby, and I.
Speaker 2: Went up there and I got to run on the
Speaker 2: trails and have a quiet space. At the time, I
Speaker 2: couldn't run something that I used to keep my sanity running.
Speaker 2: Although it's therapeutic, it's not therapy, That's what I've been told.
Speaker 1: She rented that airbnb once a month for six months.
Speaker 1: She went for runs, rested, recharged, and she ended up
Speaker 1: writing a book in that Airbnb, We'll Run for Donuts,
Speaker 1: The Montclair Bread Company Cookbook. Rachel eventually decided to rent
Speaker 1: a cheap studio apartment in New Paults while also keeping
Speaker 1: her families rental in Montclair. Although she originally sought an
Speaker 1: escape in New Pults, she eventually found inspiration too, in
Speaker 1: the form of a new business opportunity. It all started
Speaker 1: after she took up rock climbing. Climbing helped her clear
Speaker 1: her head and make new friends. So after Montclair Bread
Speaker 1: closed on Sunday, she'd head up to New Pults.
Speaker 2: And if there were donuts left over, I'd pack them
Speaker 2: up and take them to my climbing friends. So then
Speaker 2: they started asking for them, then they started ordering them,
Speaker 2: and then I was in a parking lot and a
Speaker 2: trailhead with donuts in my trunk, like you know, on
Speaker 2: Sunday afternoon, handing them out to these climbing friends and
Speaker 2: friends and friends. And I thought, there's got to be
Speaker 2: a more reasonable way to do this.
Speaker 1: She followed a familiar path. First she gave the donuts away,
Speaker 1: Then she found a farmer's market.
Speaker 2: We set up at the farmer's market. In the first week,
Speaker 2: there's like couple people in line three. There's a line
Speaker 2: all the way across the parking lot and down the
Speaker 2: block waiting for the donuts.
Speaker 1: Then she opened a new shop in New Pults in
Speaker 1: the fall of twenty twenty one, and she felt really
Speaker 1: embraced by the community there.
Speaker 2: The first weekend I was open. It was a soft opening.
Speaker 2: I never publicized it, and I had every member of
Speaker 2: the town council come and introduce themselves and give me
Speaker 2: their phone numbers in case I needed anything.
Speaker 1: This was all going on around the time a new
Speaker 1: COVID nineteen variant Delta was making its rounds. Even though
Speaker 1: infection surged, Rachel was feeling good about the state of
Speaker 1: her business until the holiday season came around and pushed
Speaker 1: Rachel to her brink because the embrace she felt from
Speaker 1: the New Paltz community was sometimes hard to find in Montclair,
Speaker 1: and an even more infectious COVID variant Omicron was waiting
Speaker 1: in the wings. All of this made the holidays more stressful.
Speaker 1: First Thanksgiving holiday dedicated to gratitude.
Speaker 2: You know, we were really short staff on Thanksgiving Day,
Speaker 2: but we opened to give out orders and for retail,
Speaker 2: and of course we start selling out because it's Thanksgiving
Speaker 2: Day and people were just screaming at my staff. Somebody
Speaker 2: screamed at one of the retail employees because it took
Speaker 2: three minutes to wait for her coffee.
Speaker 1: Second Christmas, a holiday dedicated to salvation.
Speaker 2: Christmas Eve was when we got the first call out.
Speaker 2: We got everything like shuffled around. A couple hours later,
Speaker 2: somebody else called out, and then I feel like, well
Speaker 2: do we close for the week.
Speaker 6: We can't afford to.
Speaker 2: We have to be open at least three days this
Speaker 2: week for the orders that we've already taken.
Speaker 1: Third New Year's Eve, a holiday dedicated to renewal.
Speaker 2: New Year's Eve, we get the first baker call out,
Speaker 2: so we had six people out and two people pending tests,
Speaker 2: and we decided to close on the first and second.
Speaker 6: So for two weeks ends in a row, we were closed.
Speaker 1: Montclair Bread needed twelve people to open its doors every
Speaker 1: day any less, and they were facing major inefficiencies. Orders
Speaker 1: wouldn't come out on time. With twenty people on staff
Speaker 1: and only twelve who were full time employees, that left
Speaker 1: little wiggle room for Omicron infections, so they decided to
Speaker 1: close shop for a whole week. Rachel committed to paying
Speaker 1: anyone on her staff who was scheduled to work, but
Speaker 1: no new money was coming in.
Speaker 2: The two weeks that we had to close days the
Speaker 2: weekends would have been our busiest weeks of the year,
Speaker 2: and they were the worst that.
Speaker 6: We've had on record for December.
Speaker 2: So normally that would give us a buffer to get
Speaker 2: through January and February where sales are always low.
Speaker 6: We always cut hours.
Speaker 2: And January and February, but there's no buffer, like there's nothing.
Speaker 6: To get us through.
Speaker 1: Suddenly, Rachel was at the end of her rope because
Speaker 1: Omicron had spent weeks stating her bakery's business. The peace
Speaker 1: of mind and protection she felt like she had at
Speaker 1: the beginning of twenty twenty one was gone.
Speaker 2: There was definitely a time in my life where I
Speaker 2: would have opened at any cost, even if it was
Speaker 2: just me. But by December twenty twenty one, I'm like
Speaker 2: closed the door, Just lock the door.
Speaker 1: Rachel sent an email to Montclair Bread's customers right after
Speaker 1: the new year, with the subject line SOOS, she wrote
Speaker 1: that she was waving her white flag. When my wife
Speaker 1: received that email, I worried a closed sign might appear
Speaker 1: in Rachel's window soon, so I dropped by to check
Speaker 1: in on her. The pandemic was starting to take its
Speaker 1: toll on Rachel, on her staff, her customers, everyone.
Speaker 2: Two years ago, at the beginning of this, you had
Speaker 2: this incredible community support because we were open when no
Speaker 2: one else was.
Speaker 6: But now.
Speaker 2: There's just, you know, overall, a lack of empathy for
Speaker 2: what small businesses were going through and enduring. The big
Speaker 2: thing that they don't appreciate is that we're not making
Speaker 2: up the rules. There's no playbook for us, and there's
Speaker 2: no centralized agency either local, state.
Speaker 6: Federal, that's giving us any source of information about how
Speaker 6: we're supposed to handle it. Like we're deciding the fate
Speaker 6: of everything.
Speaker 2: Just like three of us who don't have medical backgrounds,
Speaker 2: don't have science backgrounds. We just bake Brett and we're
Speaker 2: like trying to make all of these decisions.
Speaker 1: In her SOS email, Rachel asked her customers to contact
Speaker 1: their local elected leaders. Montclair's mayor and town councilors, New
Speaker 1: Jersey's governor. She didn't feel like local officials were providing
Speaker 1: her with clarity or guidance about steps she needed to
Speaker 1: take to respond to the crisis, and when she tried
Speaker 1: reaching out to them for help, she didn't have much luck.
Speaker 1: I tried to interview Montclair's mayor and the town's top
Speaker 1: administrative official about their responses to COVID, but they wouldn't
Speaker 1: take my call. Finally, a member of Montclair's town council
Speaker 1: did return my mind call, Peter Yacobellis. He's the kind
Speaker 1: of guy you want in local government, dedicated, friendly, energetic,
Speaker 1: and smart. And it turns out he actually spoke to
Speaker 1: Rachel about the concerns she raised in her SOS email,
Speaker 1: and he told me he brought one of her ideas
Speaker 1: to state and local officials, putting together a one pager
Speaker 1: with advice for small businesses on how to handle employee
Speaker 1: questions about quarantines and vaccinations, basic stuff.
Speaker 4: Rachel was the one who set the light bulb off
Speaker 4: for me.
Speaker 1: Now, why didn't that happen earlier? Why didn't that happen
Speaker 1: in mid twenty twenty? Just too many balls in the air,
Speaker 1: or just a general lack of clarity.
Speaker 4: Yeah, I think a little bit of who's going to
Speaker 4: do it too, writ whose responsibility as the CDC, the
Speaker 4: federal government stake.
Speaker 5: There to make that call, to make that call.
Speaker 4: Right in government, we have a tendency to start with
Speaker 4: experts and start with people at the top and let
Speaker 4: a cascade and filter through. We should start with the
Speaker 4: small business owner. We should start with the homeowner, asking
Speaker 4: them what's going to be easier for you, what's going
Speaker 4: to show up better for you?
Speaker 1: And I had heard other things from other entrepren that
Speaker 1: there were just these little tweaks the township could have
Speaker 1: done that would have made their lives easier as business people.
Speaker 1: Is that a legit criticism and has that been addressed?
Speaker 4: If it is, it's a completely legitimate criticism, I personally
Speaker 4: am trying to address it. I do feel like David
Speaker 4: and Goliath when it comes to some of this stuff.
Speaker 4: I think we've got really entrenched ways of doing things
Speaker 4: and not a lot of open mindedness and willingness to
Speaker 4: be dynamic and to try new things and to be innovative.
Speaker 1: Entrepreneurs are forced to be dynamic and innovative in order
Speaker 1: to survive, but they also need help, because tending to
Speaker 1: the needs of small business isn't an abstraction. At the
Speaker 1: end of twenty twenty one beginning of twenty twenty two,
Speaker 1: Rachel wasn't sure what she was going to do next
Speaker 1: in any part of her life. Her children were struggling
Speaker 1: in school, and she felt local educators were letting her down.
Speaker 1: She felt the town it turned its back on her,
Speaker 1: and she wasn't sure if Montclair Bread Company was going
Speaker 1: to make it. I wasn't sure either. I had a
Speaker 1: feeling of the pandemic and the tough economy, we're going
Speaker 1: to force Rachel to make some big changes. And I
Speaker 1: was right, but not in the way I expected. I'll
Speaker 1: tell you how Rachel made it through the third year
Speaker 1: of the pandemic and about the fate of Montclair Bread
Speaker 1: Company after the break. In a town like Montclair with
Speaker 1: forty thousand people and six shopping districts, every one of
Speaker 1: its storefronts matters. Yeah, there's a Lulu Lemon and an
Speaker 1: Urban Outfitters and a Whole Foods, But there's also a
Speaker 1: Watch hung booksellers, and an Egan and Son's restaurant and
Speaker 1: a Montclair Bread A town with just a Target and
Speaker 1: a Walmart and deliveries from Amazon loses something. It loses identity.
Speaker 5: Yeah, arts, culture, identity.
Speaker 9: I mean, well the place becomes a diamond does you
Speaker 9: could be anywhere USA.
Speaker 1: This is Jason Gleeson, head of the Montclair Center Business
Speaker 1: Improvement District. The BID is a nonprofit that manages one
Speaker 1: of the shopping districts in town. It helps new businesses
Speaker 1: get settled in and older ones up their marketing games
Speaker 1: while trying to make it easier for both to flourish,
Speaker 1: and it plants flowers. Basically, the BID.
Speaker 5: Is there to make sure that downtown Montclair is awesome.
Speaker 1: So Jason is helping the little shop around the corner survive. Why.
Speaker 9: I mean, they're the life's blood, right, I mean, it's
Speaker 9: the heartbeat of the town.
Speaker 1: What do they bring to the community that's unique from
Speaker 1: your perspective, that would be lost if they weren't there.
Speaker 9: I mean, honestly, it's such a simple answer, and it
Speaker 9: probably is going to sound like such a cop out,
Speaker 9: But like themselves.
Speaker 1: It's about individuality and how that distinguishes small businesses from
Speaker 1: the giants of corporate America.
Speaker 9: You know what Apple is, right, it has a shape
Speaker 9: and a color and a feeling.
Speaker 5: There's the product, right, you know, it's Apple.
Speaker 9: You could probably be blindfolded and someone could hand you
Speaker 9: a laptop and you could feel it for a second,
Speaker 9: be like, that's probably an Apple laptop.
Speaker 5: Right through all their branding and.
Speaker 9: Their marketing exercises and all that, and they spent a
Speaker 9: great deal of money doing that.
Speaker 5: But it's not a person. It's not a hug and
Speaker 5: a handshake. And I woke up.
Speaker 9: At four o'clock in the morning to bake this for you, or,
Speaker 9: in the case of some of our retailers, like I
Speaker 9: spent the last three months visiting artisans upstate to curate
Speaker 9: these products for your home, because I understand you as
Speaker 9: my consumer.
Speaker 1: That's why so much was at stake for small businesses
Speaker 1: when the pandemic hit.
Speaker 9: Their hopes, their dreams, their families, their college tuitions they're
Speaker 9: saving for.
Speaker 1: All of that was on the line when they were
Speaker 1: told to shut down for COVID. Now, as I've told
Speaker 1: you all along, and as her journey proves, Rachel Wyman
Speaker 1: is a survivor. But even she has had to weigh
Speaker 1: whether it's worth fighting. We're throwing in the towel because
Speaker 1: COVID nineteen has been an unrelenting opponent.
Speaker 2: I can't keep fighting by myself anymore. I just I
Speaker 2: don't know if it's worth it anymore. I mean, like
Speaker 2: last week I updated my resume. Do you know how
Speaker 2: long it's been since I updated my resume? Like that's
Speaker 2: that's the kind of place I'm in.
Speaker 1: That was Rachel at the beginning of twenty twenty two,
Speaker 1: and then she just decided to start over.
Speaker 2: I've said it so many times, I think everybody here
Speaker 2: has heard me say it at least once. If I
Speaker 2: had it to do all over again, I would just
Speaker 2: do donuts.
Speaker 1: Donuts made sense to Rachel, and.
Speaker 2: Then I'm realizing, Wow, the ingredients take up so much
Speaker 2: less space, and I can get up at five in
Speaker 2: the morning and still have donuts at eight in the
Speaker 2: morning because it takes that much less time to do
Speaker 2: the donut work, and I can do it with like
Speaker 2: me and one other person.
Speaker 1: In donuts cost less to make them bread, So even
Speaker 1: though they sold for less, they were more profitable, and
Speaker 1: the woman whose identity was wrapped up in bread and
Speaker 1: baking shifted gears. Montclair Bread Company was no more. Rachel
Speaker 1: became the owner of two storefronts with a new name,
Speaker 1: Rabble Rise Donuts. Are you surprised that the bread woman
Speaker 1: has become the donut woman?
Speaker 2: No, I think this transition to Rabble Rized donuts really,
Speaker 2: Like for a while, I fought it and I was
Speaker 2: kind of mad at it, you know that, like I'm
Speaker 2: this great bread baker, and you know, people only want
Speaker 2: the donuts. But then I decided to embrace it because,
Speaker 2: like I said, what do I do better than anyone else?
Speaker 2: I make donuts better than anyone else, And I just
Speaker 2: really wanted to embrace that. So now we're a donut shop.
Speaker 1: Rachel had barely made the transition into donut maestro before
Speaker 1: a whole new series of challenges emerged. Supply chain disruptions
Speaker 1: and soaring inflation made her so to run a simple
Speaker 1: donut shop suddenly complex. The hardships of twenty twenty two
Speaker 1: spilled over into the beginning of twenty twenty three. When
Speaker 1: I sat down with her again to talk.
Speaker 2: I can't even get eggs, like I'm buying them at
Speaker 2: the grocery store right now because I can't get eggs
Speaker 2: from my vendors. Why is that because they're out They're
Speaker 2: out of stock and eggs go in donuts.
Speaker 1: The prices of eggs, flour, and sugar have all soared,
Speaker 1: and obviously that's going to have an effect on her
Speaker 1: bottom line.
Speaker 2: I mean, at the end of the year, I would
Speaker 2: be lucky to have like three percent, you know margin,
Speaker 2: like the great thing used to be. You know, you
Speaker 2: can make a donut for fourteenth cents and then it's
Speaker 2: all the stuff that goes on top that costs the money.
Speaker 2: And that's why we charge what we charge now. It's
Speaker 2: like it costs me a dollar donut before you put
Speaker 2: anything on it.
Speaker 1: So she's had to raise the price of each donut
Speaker 1: from around two between three point fifty to five dollars.
Speaker 1: But guess what, when your donuts are really good, people
Speaker 1: will keep buying them. That's allowed Rachel to dig out
Speaker 1: from some of her lingering financial problems. And by the way,
Speaker 1: she hasn't totally gotten rid of some of the stuff
Speaker 1: I love. When I told her how I missed her
Speaker 1: sourdough bread, she let me in on a secret. If
Speaker 1: you ask, they'll bake bread to order.
Speaker 2: It's kind of like a teenager that gets grounded, where
Speaker 2: you take away all of their things and then slowly
Speaker 2: you can start giving them back as they like earn
Speaker 2: your respect and trust. So that's what happened. We took
Speaker 2: it all away, and then as our staff and systems
Speaker 2: became more and more efficient, we've been able to add
Speaker 2: some of the parts back.
Speaker 1: So are you telling me actually that those sourdough lows
Speaker 1: are still gettible?
Speaker 2: Yeah, they're still gettable. In fact, there might be one
Speaker 2: out there right now.
Speaker 1: Now that I'm going to try to lay claim to
Speaker 1: that bread.
Speaker 2: Yeah, yeah, exactly. And you know, I think having a
Speaker 2: whole bread program is, you know, costly if you're not
Speaker 2: a wholesale business, if you're not doing volume and bread,
Speaker 2: it's costly. But doing what we do, it's nice because
Speaker 2: all of the bakers on my team enjoy baking bread,
Speaker 2: and so it's kind of fun for us to do
Speaker 2: it once a week.
Speaker 1: And I would imagine it's this sort of spiritual and
Speaker 1: creative connection for you to the roots of why you
Speaker 1: started things here.
Speaker 2: Oh absolutely, yeah, absolutely.
Speaker 1: Even so, Rachel the survivor and Rachel the marathon runner,
Speaker 1: Rachel the mom, and Rachel the small business owner isn't
Speaker 1: the same person she was when I first met her
Speaker 1: three years ago. COVID rocked her world, It rocked everyone's world.
Speaker 1: But the Rachel who got to this side of COVID
Speaker 1: isn't sure she'd do it all over again.
Speaker 2: I would never tell a friend to go into this business.
Speaker 1: And if you had to walk away from it, how would.
Speaker 2: That feel like a huge weight was lifted off of
Speaker 2: my shoulders?
Speaker 1: So it would no longer feel like a sense of loss?
Speaker 2: No, no, it wouldn't.
Speaker 1: So you're staying in it now out of a sense
Speaker 1: of duty and obligation rather than joy and fulfillment.
Speaker 2: Correct, yes, that is one hundred percent accurate.
Speaker 1: Does it surprise you that that's where you are with
Speaker 1: it now?
Speaker 2: I thought that the rebranding would rejuvenate it enough to
Speaker 2: keep my heart and soul fulfilled, but it didn't really work.
Speaker 1: I can't tell you how deflating that feels. Rachel was
Speaker 1: sort of a COVID north star for me. The business
Speaker 1: woman I thought of is unbeatable. While she's not down,
Speaker 1: COVID took a lot away from her that she knows
Speaker 1: she's not getting back to be sure. She has a
Speaker 1: lot of joy in her personal life, her kids, a
Speaker 1: happier life in New Pauls and a new marriage, But
Speaker 1: on the business side of the ledger, she's also considering
Speaker 1: a career change, one that will leave her lesson involved
Speaker 1: with her little bakery in Montclair. This is a familiar
Speaker 1: story for a lot of other small businesses. So many
Speaker 1: of them close their doors in a typical year, and
Speaker 1: COVID visited a raft of atypical problems upon all of them.
Speaker 1: One of the foundational ideas of capitalism is creative destruction,
Speaker 1: the notion that businesses are born and fail all the
Speaker 1: time and survival of the fittest is an efficient process.
Speaker 1: But that also discounts another truth that great ideas, services
Speaker 1: and products aren't always easily replaced, and some magic can
Speaker 1: get lost along the way, like a really good loaf
Speaker 1: of bread. Here at Crash Course, we believe the collisions
Speaker 1: can be messy, impressive, challenging, surprising, and always instructive. In
Speaker 1: today's Crash Course, I learned and sometimes you can't fix
Speaker 1: big problems facing small businesses by simply throwing money at them.
Speaker 1: PPP was an epic spending plan, but ultimately it wasn't
Speaker 1: enough and it was never going to work if that
Speaker 1: money wasn't paired with good global public health policies. In
Speaker 1: many cases, COVID turned out to be more powerful than
Speaker 1: money and entrepreneurial grit, even when an entrepreneur was as
Speaker 1: gritty as Rachel. What did you learn? We'd love to
Speaker 1: hear from you. You can tweet at the Bloomberg Opinion,
Speaker 1: handle at Opinion or me at Tim O'Brien using the
Speaker 1: hashtag Bloomberg Crash Course. You can also subscribe to our
Speaker 1: show wherever you're listening right now and leave us a
Speaker 1: review that helps more people find the show. This episode
Speaker 1: was produced by the indispensable Animasarakas and Me. Our supervising
Speaker 1: producer is Magnus Hendrickson, and we had editing help from
Speaker 1: Katie Boyce, Jeff Grocott, Mike Nizza, Ta of al brun
Speaker 1: and Christine Vanden Bilart. Blake Maples does our sound engineering,
Speaker 1: and our original theme song was composed by Luis Garra.
Speaker 1: I'm Tim O'Brien. We'll be back next week with another
Speaker 1: Crash Course.