WEBVTT - What an LA Bakery Says About the Economy Right Now 0:00:02.480 --> 0:00:14.000 Bloomberg Audio Studios, Podcasts, Radio News. 0:00:18.280 --> 0:00:21.240 Hello and welcome to another episode of the All Thoughts Podcast. 0:00:21.320 --> 0:00:22.960 I'm Tracy Alloway and I'm Jill. 0:00:22.960 --> 0:00:24.079 Why isn't thal Joe? 0:00:24.120 --> 0:00:26.119 I have a very personal question to ask you. 0:00:27.520 --> 0:00:29.760 Well, we've known each other for a very long time, 0:00:29.960 --> 0:00:32.040 so there's not much left that we don't know, but 0:00:32.159 --> 0:00:32.640 go for it. 0:00:32.640 --> 0:00:35.360 Well, I actually don't know the answer to this question. 0:00:35.880 --> 0:00:37.239 Have you ever baked anything? 0:00:38.159 --> 0:00:42.360 Ah, not that much. I went through this. I'm just 0:00:42.360 --> 0:00:44.440 gonna the answer is basically no. 0:00:44.440 --> 0:00:46.599 No, Wait, you were going to say something. You went 0:00:46.600 --> 0:00:47.520 through a phase one. 0:00:47.400 --> 0:00:49.159 Time in high school. I got in this like weird, 0:00:49.360 --> 0:00:52.720 like experimental baking obsession with a friend of mine where 0:00:52.720 --> 0:00:55.560 we just sort of tried to relearn baking by first 0:00:55.640 --> 0:00:57.040 principles and see what works. 0:00:57.080 --> 0:00:58.440 Oh my god, what does that mean? 0:00:58.760 --> 0:01:02.440 Just like not eating any recipes, so not reading any 0:01:02.440 --> 0:01:04.960 recipes and just start figuring it out and then seeing 0:01:05.000 --> 0:01:07.800 like what cause things to rise and what tasted good 0:01:07.800 --> 0:01:10.640 without any starting principles or anything. We knew a few 0:01:10.640 --> 0:01:11.480 basic ingredients. 0:01:11.480 --> 0:01:11.800 It's fun. 0:01:11.840 --> 0:01:12.920 I should get back into bacon. 0:01:13.080 --> 0:01:14.440 You should, It's really fun. 0:01:14.520 --> 0:01:16.800 What do you, Tracy? We know this is just a setup. 0:01:16.800 --> 0:01:19.720 Because you want to talk about your bacon, why don't 0:01:19.720 --> 0:01:21.039 you just tell us what you like to bake. 0:01:21.160 --> 0:01:24.560 Hey, look, I don't bake that much. Actually in my household, 0:01:24.680 --> 0:01:27.800 my husband bakes everything. So he does a really good 0:01:27.959 --> 0:01:31.880 bass cheesecake, really good chocolate chip cookies, things like that. 0:01:32.120 --> 0:01:36.160 But if you were doing first principle baking, I imagine 0:01:36.200 --> 0:01:38.680 you know how difficult it is and all the things 0:01:38.680 --> 0:01:41.679 that are involved in just making like a simple loaf 0:01:41.680 --> 0:01:42.119 of bread. 0:01:42.920 --> 0:01:44.000 I am aware. 0:01:44.080 --> 0:01:47.360 And the other thing is not only I understand that 0:01:47.400 --> 0:01:51.120 it's very complex, but beyond that, I'm always flabbergested at 0:01:51.120 --> 0:01:53.640 the idea of doing it at industrial scale or semi 0:01:53.640 --> 0:01:57.720 industrial scale, and how that even works. I have no idea, 0:01:57.880 --> 0:02:01.360 to be honest, honestly, industrial scale food preparation at all 0:02:01.680 --> 0:02:04.320 seems crazy to me, like steaks and everything, Like how 0:02:04.360 --> 0:02:06.120 do you do it over and over and over again 0:02:06.200 --> 0:02:08.760 and get a repeatable process? It is like a fascinating 0:02:08.840 --> 0:02:09.280 question to me. 0:02:09.440 --> 0:02:11.960 Right, So that's really interesting in and of itself. But 0:02:12.080 --> 0:02:15.720 the other interesting thing about the baking business at industrial scale, 0:02:15.760 --> 0:02:17.640 as you just pointed out, is it's kind of a 0:02:17.680 --> 0:02:21.440 microcosm for the economy. You have all these commodity inputs, 0:02:21.560 --> 0:02:26.280 which obviously move around along with inflation. You have labor issues, 0:02:26.360 --> 0:02:28.600 you have to get bakers who want to get into 0:02:29.000 --> 0:02:32.520 work really really early in the morning, and obviously you 0:02:32.560 --> 0:02:36.280 also have consumer demands. So it's really an interesting lens 0:02:36.360 --> 0:02:37.600 to kind of look through. 0:02:38.040 --> 0:02:41.359 Well, one of our the favorite episodes that we've ever done, 0:02:41.560 --> 0:02:44.600 which I think was twenty twenty two or maybe twenty twenty. 0:02:44.320 --> 0:02:46.519 One, long time ago, we. 0:02:46.400 --> 0:02:50.239 Talked to a commercial baker in Chicago, and I've always 0:02:50.320 --> 0:02:53.040 wanted to do more. There was such a pivotal episode 0:02:53.080 --> 0:02:55.000 for us, and I was like, well, you know, we 0:02:55.080 --> 0:02:57.720 learned a lot about what was going on with commodity costs, 0:02:57.760 --> 0:02:59.840 we learned a lot what was going on with pricing, power, 0:03:00.000 --> 0:03:02.880 et cetera. Well, it's twenty twenty five now I would 0:03:02.880 --> 0:03:04.120 like to learn more about what's going on. 0:03:04.400 --> 0:03:07.959 All right, So we're gonna dive back into baking, possibly 0:03:07.960 --> 0:03:10.720 not on a first principal basis, but we have the 0:03:10.760 --> 0:03:13.200 perfect guest. We're going to be speaking with Andy Cayden. 0:03:13.480 --> 0:03:16.240 He diden banking baking from first principles to be a 0:03:16.280 --> 0:03:18.600 really good that would be like a good name for 0:03:18.600 --> 0:03:20.040 a cookbook. All right, Sorry, keep going. 0:03:20.800 --> 0:03:24.080 Good name for a baking podcast. Perhaps, Okay, we're going 0:03:24.120 --> 0:03:26.480 to be speaking with Andy Cayden. He is the owner 0:03:26.680 --> 0:03:30.280 of a bakery in LA that's called Bub and Grandma's. 0:03:30.360 --> 0:03:34.360 They do wholesale orders for a bunch of different LA restaurants, 0:03:34.360 --> 0:03:36.800 so industrial scale, as you mentioned, Joe, but they also 0:03:36.920 --> 0:03:40.720 have a retail restaurant that does sandwiches and they're in 0:03:40.720 --> 0:03:42.800 the process of opening a pizzerias. 0:03:42.840 --> 0:03:44.240 So amazing all the. 0:03:44.160 --> 0:03:46.840 Baked goods Andy, welcome to the show. 0:03:48.200 --> 0:03:49.680 Really good to be here, Thanks for having me. 0:03:50.640 --> 0:03:53.560 Shall we start out with where did your interest in 0:03:53.720 --> 0:03:58.200 bread actually come from? Was this like a COVID trope 0:03:58.280 --> 0:04:01.600 where everyone started doing their own sour dough and got 0:04:01.640 --> 0:04:04.000 really into carbohydrates. 0:04:05.040 --> 0:04:10.040 Maybe I'm a little prot Covid in my obsession. I 0:04:10.160 --> 0:04:12.560 was a writer in advertising and TV for about a 0:04:12.640 --> 0:04:16.120 decade after school and learned fairly quickly after I got 0:04:16.160 --> 0:04:20.480 to Los Angeles about sixteen years ago that I hated 0:04:20.520 --> 0:04:23.919 it and hated myself for contributing to sort of the 0:04:23.960 --> 0:04:27.840 advertising culture, so to speak, and I needed to escape 0:04:28.000 --> 0:04:31.760 and always had an obsession with cooking and eating and 0:04:32.600 --> 0:04:36.200 decided to focus on something that I saw missing from 0:04:36.200 --> 0:04:38.400 the Los Angeles landscape. After I moved here from the 0:04:38.400 --> 0:04:40.560 East Coast. I grew up in New Jersey kind of 0:04:40.600 --> 0:04:47.040 in Italian Jewish sandwich mecca, and saw that there was 0:04:47.080 --> 0:04:51.760 sort of a glaring absence of those style of kind 0:04:51.760 --> 0:04:53.960 of walk into it and have a great sandwich kind 0:04:54.000 --> 0:04:56.680 of experience in Los Angeles. There are a few notable spots, 0:04:56.680 --> 0:04:58.520 but they aren't everywhere like they are in New York 0:04:58.560 --> 0:05:02.040 and New Jersey. I decided to start writing some business 0:05:02.120 --> 0:05:05.119 plans and figure out how to open a sandwich shop here, 0:05:06.480 --> 0:05:09.920 and you know, started working at sandwich hoop in Hollywood 0:05:09.960 --> 0:05:13.480 called Potato Chips for free on the weekends, staging at 0:05:13.520 --> 0:05:15.680 a variety of bakeries, just to try and figure out 0:05:15.720 --> 0:05:17.960 how bread worked. And in that process of trying to 0:05:17.960 --> 0:05:20.680 figure out how bread works, simply just to talk to 0:05:20.760 --> 0:05:23.920 bakers about what I wanted, I started baking daily at 0:05:23.960 --> 0:05:28.400 home and got into that pseudo Covid rhythm of daily 0:05:28.440 --> 0:05:32.520 baking and the obsession of that comes from falling into it, 0:05:33.200 --> 0:05:37.400 you know, into its grasp, and you know, started giving 0:05:37.440 --> 0:05:39.159 away all the bread I was making, and it found 0:05:39.200 --> 0:05:42.240 its way to a friend of mine who worked at 0:05:42.240 --> 0:05:44.640 a local restaurant and the owner called me out of 0:05:44.640 --> 0:05:46.120 the blue and asked if I could make bread for 0:05:46.200 --> 0:05:49.920 him daily. I said yes, and hasn't stopped for ten years. 0:05:50.279 --> 0:05:53.520 Wait, so initially were you just baking bread at scale 0:05:53.680 --> 0:05:54.400 in your kitchen. 0:05:55.760 --> 0:05:59.240 I started as just for me, just as an experiment, 0:05:59.800 --> 0:06:02.920 but very quickly kind of once I had that first account, 0:06:02.920 --> 0:06:05.520 which was maybe six months after I started baking, six 0:06:05.560 --> 0:06:09.919 months to a year, the attention came quickly and I 0:06:09.960 --> 0:06:13.080 started needing to level up over and over and over again. 0:06:13.200 --> 0:06:16.640 So the first place that I would mix the bread 0:06:16.720 --> 0:06:20.240 in my house and ferment it there, and then shape 0:06:20.279 --> 0:06:22.359 it and take it to a pizza place around the 0:06:22.360 --> 0:06:24.960 corner and bake it in there pizza oven. It was 0:06:25.120 --> 0:06:28.680 a variety of these acts together, baking in other bakeries 0:06:28.760 --> 0:06:33.600 off hours to get things done, and as the demand 0:06:33.680 --> 0:06:37.080 grew very quickly, I quickly had to figure out how 0:06:37.120 --> 0:06:39.640 to run a business, not just bake a few loaves 0:06:39.680 --> 0:06:42.600 of bread out of my house, and moved into a 0:06:43.040 --> 0:06:45.760 semi legitimate space at about a year and a half. 0:06:46.160 --> 0:06:48.440 Flash forward to today, zooming out, why don't you tell 0:06:48.520 --> 0:06:52.039 us about the size and scope of your businesses? What 0:06:52.120 --> 0:06:53.880 do you have right now just in terms of a 0:06:53.960 --> 0:06:55.760 volume and number of employees stuff like that. 0:06:56.360 --> 0:06:59.760 The wholesale bakery, which is what that story evolved into, 0:07:00.200 --> 0:07:02.799 is now a fifty person business. We have a sixty 0:07:02.800 --> 0:07:06.320 five hundred square foot facility that produces bread, just bread, 0:07:06.400 --> 0:07:09.279 not pastry, for about one hundred and eighty restaurants in 0:07:09.279 --> 0:07:12.160 Los Angeles. It's a pretty wide distribution, and we are 0:07:12.280 --> 0:07:14.760 still trying to grow. We're kind of wall to wall 0:07:14.800 --> 0:07:16.560 in that space and need to move in the next 0:07:16.640 --> 0:07:19.080 two years, so we're starting to investigate what that would 0:07:19.080 --> 0:07:22.960 look like. We also opened a retail restaurant almost three 0:07:23.040 --> 0:07:25.640 years ago, which is insane how quickly that three years 0:07:25.680 --> 0:07:28.760 has passed in our weird time vortex that we live 0:07:28.800 --> 0:07:33.400 within now, and that is another almost fifty person business 0:07:33.800 --> 0:07:37.160 in the Glassow Park neighborhood of Los Angeles. We are 0:07:37.200 --> 0:07:40.200 in the process of opening a pizza place in Highland Park, 0:07:40.200 --> 0:07:43.720 a neighboring neighborhood, that will be open, hopefully in the 0:07:43.720 --> 0:07:46.760 next four to five weeks, so that'll be another thirty employees, 0:07:46.800 --> 0:07:48.080 growing to fifty over time. 0:07:48.600 --> 0:07:51.800 Why did you decide to do the retail sandwich shop, 0:07:51.840 --> 0:07:55.800 because I imagine wholesale actually sounds kind of nice because you're 0:07:55.840 --> 0:07:59.200 still making a product, but you're divorced from face to 0:07:59.280 --> 0:08:03.120 face interact with customers, which sounds nice to me, but 0:08:03.480 --> 0:08:05.000 obviously you have a different opinion. 0:08:06.160 --> 0:08:11.040 No, I don't. I mean, we started with wholesale. We 0:08:11.080 --> 0:08:14.960 started in this less sexy, less customer facing environment for 0:08:15.000 --> 0:08:18.200 the first say, five years of the business before we 0:08:18.720 --> 0:08:21.440 you know, changed gears to open the retail restaurant. The 0:08:21.520 --> 0:08:26.400 wholesale business is a much more steady ship. I sort 0:08:26.440 --> 0:08:29.360 of describe it as you have this big ship. It's 0:08:29.480 --> 0:08:33.160 moving up and down in the water, but ultimately as 0:08:33.800 --> 0:08:37.320 forward moving. It's harder to capsize. It's harder to knock 0:08:37.360 --> 0:08:40.120 off course, and that makes it a little bit, let's say, 0:08:40.200 --> 0:08:43.400 less crazy the restaurant business, which was what I wanted 0:08:43.400 --> 0:08:45.520 to get into in the first place. Had I known 0:08:45.640 --> 0:08:48.640 what it would be like at the now that I'm there, 0:08:48.760 --> 0:08:50.920 you know, maybe a wholesale would have been better. To 0:08:50.920 --> 0:08:53.960 stay out. It's so much harder. It's much more dynamic, 0:08:54.080 --> 0:08:57.400 everything is changing all the time, much more difficult to 0:08:57.440 --> 0:09:01.160 isolate the variables. There's far more variable to consider in 0:09:01.200 --> 0:09:04.360 the restaurant, especially when you bring in customer customer behaviors 0:09:04.360 --> 0:09:08.040 and how things really just consistently fluctuate across the board. 0:09:14.559 --> 0:09:16.320 One of the themes that comes up in a range 0:09:16.360 --> 0:09:19.800 of topics that we talk about is distribution, and actually 0:09:20.080 --> 0:09:24.319 well distribution in terms of sales, but also the physical distribution. 0:09:24.679 --> 0:09:26.920 How does it work in Los Angeles? Do you have 0:09:26.960 --> 0:09:29.760 your own vans? Are there third parties that drop off 0:09:29.760 --> 0:09:31.479 the bread to the restaurants? 0:09:31.480 --> 0:09:31.560 Like? 0:09:31.720 --> 0:09:33.880 Talk about how you like built up that network and 0:09:33.920 --> 0:09:36.600 how the bread physically gets from your commercial bakery into 0:09:36.600 --> 0:09:37.079 the restaurant. 0:09:37.240 --> 0:09:40.959 Sure, yeah, we have. Currently we have six vans that 0:09:41.160 --> 0:09:44.640 are either leased or owned, and it's been a bit 0:09:44.679 --> 0:09:48.199 of an excruciating endeavor building out this whole network because 0:09:48.200 --> 0:09:51.120 it is a major, major part of what we do, 0:09:51.360 --> 0:09:53.800 especially because we're wall to wall. When I say wal 0:09:53.880 --> 0:09:56.640 to wall, it basically means there is literally no more 0:09:56.640 --> 0:09:59.960 ovens based per hour available for new loaves of bread 0:10:00.120 --> 0:10:03.040 to increase our productions. So if you start baking at 0:10:03.080 --> 0:10:05.160 two thirty in the morning and you need to get 0:10:05.200 --> 0:10:07.320 bread to all of these accounts before they open at 0:10:07.320 --> 0:10:10.080 eight am, you have a very narrow window to cool 0:10:10.160 --> 0:10:12.400 that bread, pack that bread, get it into the vans, 0:10:12.440 --> 0:10:15.640 and get it out to these accounts. So our ops 0:10:15.679 --> 0:10:19.240 team at the bakery are true geniuses and building out 0:10:19.280 --> 0:10:23.440 these roots because you have only had this very narrow 0:10:23.480 --> 0:10:26.920 gap to hit, and if there's famous La traffic or 0:10:26.960 --> 0:10:30.040 anything else that gets backed up in the baking process, 0:10:30.559 --> 0:10:32.920 you are scrambling to try and make sure that you 0:10:32.960 --> 0:10:34.760 take care of these accounts in a way where they 0:10:34.760 --> 0:10:37.360 can still do their jobs. So we have to do 0:10:37.440 --> 0:10:40.040 our job, not only just the baking job, but the 0:10:40.040 --> 0:10:43.600 distribution job before they show up, before anybody else from 0:10:43.600 --> 0:10:46.600 our accounts show up to work. Also, the vans themselves 0:10:46.679 --> 0:10:50.679 are you know, deeply problematic. They are the number one 0:10:51.280 --> 0:10:54.800 thing that breaks needs service, needs attention, you know, more, 0:10:54.840 --> 0:10:57.000 even more so than our ovens, which are in near 0:10:57.080 --> 0:11:01.440 constant use. And we have explored a number of different options, 0:11:01.520 --> 0:11:04.360 especially for when we potentially move to a bigger space 0:11:04.880 --> 0:11:08.840 about outsourcing our distribution. There are a lot of upstart 0:11:09.120 --> 0:11:12.400 wholesale distribution companies, some of which are based in La 0:11:12.480 --> 0:11:14.880 a lot more in San Francisco that are sort of 0:11:14.920 --> 0:11:19.040 taking the Uber approach and outsourcing their drivers or having 0:11:19.040 --> 0:11:21.360 a dedicated pool of drivers who work with a variety 0:11:21.400 --> 0:11:24.320 of different accounts as opposed to one to one so that, 0:11:24.679 --> 0:11:28.280 you know, one of the major issues with our business 0:11:28.480 --> 0:11:32.320 is the you know, fluctuating repair and maintenance numbers for 0:11:32.440 --> 0:11:35.000 our vans. If we can offload that to someone else, 0:11:35.480 --> 0:11:38.520 that is something that we have certainly looked into. But 0:11:38.800 --> 0:11:42.520 when we get into the mix with these conversations, we 0:11:42.640 --> 0:11:45.200 always kind of end in the same place where, yes, 0:11:45.280 --> 0:11:50.040 we are not a customer you know, a consumer facing company, 0:11:50.360 --> 0:11:54.360 but our business relies on that single interaction between the 0:11:54.440 --> 0:11:57.080 chefs and our drivers. They are our point of contact 0:11:57.080 --> 0:12:00.000 with our customers. And if that is not an authentic connection, 0:12:00.040 --> 0:12:02.800 and if that is not something our employees are connecting 0:12:02.840 --> 0:12:05.840 with our customers, there's a potential for things to go 0:12:05.920 --> 0:12:09.040 wrong and a potential for that relationship to be sour. 0:12:09.240 --> 0:12:12.760 So we've ultimately stuck with our own employees and our 0:12:12.800 --> 0:12:13.800 own vans for now. 0:12:14.200 --> 0:12:16.200 Tracy, I'm just thinking about how crazy it must be 0:12:16.280 --> 0:12:18.720 like have an interest in bread such as yourself, and 0:12:18.760 --> 0:12:20.160 then suddenly like you're in the. 0:12:20.080 --> 0:12:21.280 Break become a mechanic. 0:12:21.280 --> 0:12:23.240 Oh, you're in the break prayer business too, and you 0:12:23.280 --> 0:12:24.280 got to take that into account. 0:12:24.320 --> 0:12:24.440 Now. 0:12:24.520 --> 0:12:26.320 I was thinking the same thing, and it's something that 0:12:26.400 --> 0:12:29.400 I guess when people envision a bakery you don't necessarily 0:12:29.440 --> 0:12:33.480 think about the transportation and delivery aspect of it. But Andy, 0:12:33.880 --> 0:12:37.520 you mentioned two thirty am just then and the narrow 0:12:37.600 --> 0:12:41.400 window for delivery, and I have to ask, what's it 0:12:41.520 --> 0:12:45.640 like getting actual workers in the door? Who who want 0:12:45.679 --> 0:12:47.880 to I guess wake up at like one am in 0:12:47.920 --> 0:12:49.400 the morning and go bake bread. 0:12:50.480 --> 0:12:53.520 Yeah, it's it's tricky, you know. You first of all, 0:12:53.559 --> 0:12:57.880 you have to love it. You have to love the process. 0:12:58.120 --> 0:13:02.440 And I mean the two thirds the aspect is, you know, 0:13:03.280 --> 0:13:08.319 very very early and a very very different lifestyle in 0:13:08.600 --> 0:13:11.880 a literal way. You are falling asleep at five thirty pm, 0:13:12.400 --> 0:13:15.920 and that means that your you know, connection with your 0:13:15.920 --> 0:13:18.400 family or connection with your friends. You're operating on a 0:13:18.400 --> 0:13:21.680 completely different time zone than they are, and it makes 0:13:21.720 --> 0:13:24.600 things complicated if folks are not operating on the same 0:13:24.600 --> 0:13:29.760 schedule as you. But you know, the it's that was 0:13:29.800 --> 0:13:32.280 the last baking ship that that I did was the 0:13:32.320 --> 0:13:35.600 Sunday morning two thirty am bake for the Hollywood Farmer's Market. 0:13:35.720 --> 0:13:38.440 I would, you know, get up at two roll down 0:13:38.440 --> 0:13:40.880 to the bakery. It would be just me in the dark, 0:13:41.000 --> 0:13:44.800 a lot of people returning from their various parties, on 0:13:44.840 --> 0:13:48.000 Saturday night, which made driving there a little bit sketchy, 0:13:48.040 --> 0:13:51.040 but always you know, being careful and then you know, 0:13:51.120 --> 0:13:53.360 finish the bake, pack it up, put it in my truck, 0:13:53.400 --> 0:13:56.240 and go to the farmer's market and sell it. And 0:13:56.280 --> 0:13:58.240 then the day would wrap up around two thirty, so 0:13:58.240 --> 0:14:00.720 it would be this twelve hour kind of sprint and 0:14:00.760 --> 0:14:04.160 then sale and then come back. And you know, at 0:14:04.200 --> 0:14:06.880 a certain point it was the only bake shift that 0:14:06.920 --> 0:14:09.400 I was doing because I had to manage the business 0:14:09.840 --> 0:14:11.520 during the other days of the week that I was 0:14:11.559 --> 0:14:15.120 not doing that. And when you just bake one day 0:14:15.120 --> 0:14:18.360 a week at two thirty in the morning, it scrambles 0:14:18.400 --> 0:14:21.840 your mind so wildly and your sleep schedule that I 0:14:21.880 --> 0:14:24.440 had to eventually abandon it just because I needed more 0:14:24.480 --> 0:14:27.240 time to manage the businesses. But you really have to 0:14:27.720 --> 0:14:30.960 subscribe to the lifestyle if you try and push the edge, 0:14:31.440 --> 0:14:34.880 you know, especially when I was baking and managing five days, 0:14:34.920 --> 0:14:36.920 baking five days a week and still trying to manage 0:14:36.920 --> 0:14:39.400 the business, it was getting sick a lot. It was 0:14:39.560 --> 0:14:43.920 very difficult to stay healthy when you're operating across two 0:14:44.880 --> 0:14:47.680 you know, time zones. Really you're living in this kind 0:14:47.720 --> 0:14:50.960 of Oh my wife and my friends are all living 0:14:50.960 --> 0:14:53.440 in this time zone, and my business is living in 0:14:53.480 --> 0:14:56.240 this time zone, and I need both. I need to 0:14:56.240 --> 0:14:59.680 be there for both. Those were far more complicated times 0:14:59.720 --> 0:15:03.280 for my own health. But we're on the other side 0:15:03.280 --> 0:15:03.880 of that now. 0:15:04.040 --> 0:15:07.760 We mentioned in the beginning, you know, we like this 0:15:07.920 --> 0:15:11.320 topic because it's sort of a lends into everything. But 0:15:11.440 --> 0:15:13.480 what are you seeing today in terms of you know, 0:15:13.480 --> 0:15:15.960 if you compare now to when you started, how do 0:15:16.040 --> 0:15:18.920 you think or versus the peak of the inflation whatever was, 0:15:19.200 --> 0:15:21.680 how do things look today when it comes to both 0:15:22.120 --> 0:15:27.120 hiring availability and also raw commodity cost ingredient costs. 0:15:27.720 --> 0:15:32.440 Hiring availability is unique for us. Obviously, we are looking 0:15:32.480 --> 0:15:35.680 for a very specialized group of people. So the skills 0:15:35.720 --> 0:15:40.680 that they hopefully already have are in rare supply in 0:15:40.720 --> 0:15:44.680 Los Angeles, and that makes hiring complicated far more so 0:15:44.760 --> 0:15:47.040 for the wholesale bakery than for the restaurant. The restaurant 0:15:47.080 --> 0:15:49.600 has a lot of over the pool is much wider, 0:15:49.920 --> 0:15:52.800 and we have very little trouble hiring at the restaurant 0:15:54.040 --> 0:15:55.440 the bakery. 0:15:55.480 --> 0:15:58.080 Would you have said this same thing in twenty twenty 0:15:58.120 --> 0:16:00.440 two or twenty twenty three, or does it feel easier 0:16:00.480 --> 0:16:02.560 today than it would have back then at the at 0:16:02.560 --> 0:16:04.560 the retail level, because that's where that's where like all 0:16:04.600 --> 0:16:06.640 the complaints were, right, everyone, all the restaurants in the 0:16:06.680 --> 0:16:09.440 service entities were complaining about how impossible it was. 0:16:10.400 --> 0:16:14.320 I think that it's I think that it's impossible if 0:16:14.320 --> 0:16:18.760 you don't already have a name that people know. And 0:16:18.840 --> 0:16:21.400 I think for us, we've spent a lot of our 0:16:21.400 --> 0:16:23.880 efforts making sure that our employees are well taken care 0:16:23.920 --> 0:16:27.640 of and supported and treated like the human beings that 0:16:27.680 --> 0:16:31.440 they are. And I think that when we open the 0:16:31.480 --> 0:16:35.000 restaurant after the bakery, that was already somewhat established in 0:16:35.040 --> 0:16:39.160 the in the public eye, so that helps us to 0:16:39.320 --> 0:16:41.920 kind of make this place. I mean, this is the 0:16:42.160 --> 0:16:43.440 point of it all is we want to make this 0:16:43.480 --> 0:16:46.520 a desirable place, uh for for people to work, so 0:16:46.520 --> 0:16:48.240 that when they come here, they have a good time, 0:16:48.560 --> 0:16:51.360 they're well supported, they get fed, they get treated well, 0:16:51.360 --> 0:16:55.800 they have health care. And you know, we really built 0:16:55.800 --> 0:16:59.360 this thing on that it's becoming harder and harder to 0:16:59.400 --> 0:17:02.320 have a functional business including all of those things, which 0:17:02.360 --> 0:17:05.000 is you know, the real issue at hand here is 0:17:05.040 --> 0:17:10.440 that the expenses are enumerting and the you know, sales 0:17:10.480 --> 0:17:14.760 remain the same. So when we talk about raw materials, 0:17:15.320 --> 0:17:18.080 there's been there's were actually in a much better place 0:17:18.119 --> 0:17:20.440 than we were, say a year ago or even a 0:17:20.520 --> 0:17:25.080 year before that. The bakery goes by one ingredient, it's flour. 0:17:24.800 --> 0:17:28.800 Flour is wheat, and wheat is you know, a global 0:17:28.800 --> 0:17:34.280 commodity that has a lot of fluctuations. It's usually compared 0:17:34.280 --> 0:17:39.439 to others, fairly steady. But for example, when the Russia 0:17:39.520 --> 0:17:43.439 Ukraine War broke out there Russia was not allowing Ukraine's 0:17:43.440 --> 0:17:45.960 wheat to leave the country. Ukraine is the sort of 0:17:46.000 --> 0:17:50.080 bread basket provider of wheat for Europe, and when that happens, 0:17:50.200 --> 0:17:52.879 there's much more demand coming from the United States. Prices 0:17:52.920 --> 0:17:56.479 go up, and the American users of American wheat are 0:17:56.520 --> 0:17:58.760 the ones who end up paying more so that those 0:17:58.800 --> 0:18:01.440 products end up in Europe cover for the loss of supply. 0:18:02.480 --> 0:18:06.680 So we saw maybe a ten percent increase in flour pricing. 0:18:07.119 --> 0:18:09.560 It caused us to have to drive our prices up 0:18:09.600 --> 0:18:12.280 for the first time in a long time bread wise. 0:18:14.080 --> 0:18:17.160 Now it has settled back down, but in the meantime, 0:18:17.200 --> 0:18:20.440 everything else has gotten more expensive, and you know, there's 0:18:20.520 --> 0:18:25.280 there's a you know, massive wave of restaurant closures in 0:18:25.320 --> 0:18:28.440 Los Angeles right now, including yesterday, Coal's one hundred and 0:18:28.480 --> 0:18:31.800 seventeen year old restaurant announced that it's closing. The pantry, 0:18:31.800 --> 0:18:34.520 which has been around for one hundred years closed. It's 0:18:34.520 --> 0:18:38.840 a very very very very difficult time for restaurants to thrive, 0:18:39.040 --> 0:18:42.240 let you know, survive, let alone thrive in this town. 0:18:42.400 --> 0:18:45.080 So interesting times for sure. 0:18:51.720 --> 0:18:54.439 Just on the commodities front, how does it work in 0:18:54.520 --> 0:18:58.480 terms of actually sourcing things like flower Do you sign 0:18:58.720 --> 0:19:02.760 you know, forward agreement with suppliers at a certain price 0:19:02.960 --> 0:19:06.359 and I guess, like how long term are those prices set. 0:19:07.640 --> 0:19:11.280 Yeah, it's depends very much on volume. And we are 0:19:11.280 --> 0:19:14.359 in this very unique sort of middle ground where we 0:19:14.400 --> 0:19:17.560 are not a giant twenty five thousand square foot bakery 0:19:17.560 --> 0:19:19.880 and we are not one of the sort of more 0:19:19.880 --> 0:19:22.879 retail oriented two thousand square feet bakeries. We are in 0:19:22.920 --> 0:19:25.399 the middle looking to make this leap to where we 0:19:25.440 --> 0:19:28.320 can buy directly from our purveyors, and when we can 0:19:28.480 --> 0:19:31.240 like purveyors as in non distributors, directly from King Arthur, 0:19:31.280 --> 0:19:34.879 directly from Camus Country Mill, directly from a variety of 0:19:34.920 --> 0:19:37.680 other flour purveyors. And when we can do those types 0:19:37.720 --> 0:19:40.040 of things that buy at scale, say seventeen to twenty 0:19:40.080 --> 0:19:42.720 pallets of flour at a time, we can lock in 0:19:42.800 --> 0:19:45.400 forward pricing with King Arthur, with some of the other ones. 0:19:45.440 --> 0:19:48.680 But in the moment now where we're operating through distributors, 0:19:49.119 --> 0:19:53.920 we are subject to their markup and they are fluctuating 0:19:54.080 --> 0:19:57.439 what they're doing based on whatever algorithms they're using to 0:19:57.480 --> 0:20:01.760 calculate proper pricing, not only us from what they're getting 0:20:01.840 --> 0:20:05.720 charged from the you know, the actual producer, but also 0:20:06.480 --> 0:20:09.240 however their business is doing, and whatever you know markup 0:20:09.280 --> 0:20:12.320 they need to include. So what we do in that circumstance, 0:20:12.359 --> 0:20:16.119 and what most restaurants do is regularly pit distributors against 0:20:16.160 --> 0:20:19.000 each other for our business, especially because we have a 0:20:19.040 --> 0:20:21.760 lot of leverage with our flower orders. It's it's a 0:20:21.840 --> 0:20:25.560 fairly significant regular order. So even if they're making a 0:20:25.680 --> 0:20:29.720 very small amount on that on each bag, there there's 0:20:29.800 --> 0:20:32.440 a large volume and a large frequency that has those 0:20:32.800 --> 0:20:35.840 purveyors kind of jockeying for the lower price. And that's 0:20:36.080 --> 0:20:41.080 there's no service, there's no anything else that really matters 0:20:41.080 --> 0:20:42.959 in that relationship. It's just if you can get us 0:20:42.960 --> 0:20:44.800 the price we will order from you this week, and 0:20:45.280 --> 0:20:47.800 they know that and they fight, and it's a weekly price. 0:20:49.400 --> 0:20:52.200 It's it's more frequent than week weekly. At the moment, 0:20:52.400 --> 0:20:55.960 there's a little bit of flux June June, you know. 0:20:56.000 --> 0:20:59.400 And I just have regular conversations with King Arthur, who's 0:20:59.400 --> 0:21:03.159 our main brand flower supplier, who are one of the 0:21:03.200 --> 0:21:05.919 most wonderful businesses in the country and just good people 0:21:05.960 --> 0:21:11.680 and always you know, driven to help their clients. They 0:21:12.040 --> 0:21:16.040