FRANKFORT — Aug. 12, 2016, was recognized as National Kool-Aid Day, National Sewing Machine Day, and World Elephant Day. At the Route 5S South Industrial Park in Herkimer County, Aug. 12 was celebrated as the day Heidelberg Bread ramped up to full production at its much-needed new plant.
“We just couldn’t handle the volume at our old bakery,” says Boyd Bissell, president and master baker of Heidelberg Group, Inc. “We were shipping 65,000 loaves weekly running two shifts in 7,800 [square] feet, and there wasn’t enough space to accommodate the operation, especially room to allow the loaves to cool. We ship daily to supermarket chains and independents as far away as the Capital District, Hudson Valley, the Southern Tier, and Syracuse. You can find Heidelberg products in the bread section at Big M, Hannaford, BJs, Price Chopper, and many other outlets. With our focus on adding more distributors, the demand will only continue to grow.”
The new facility has the capacity to quadruple the current production.
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Heidelberg bakes 15 varieties of bread from sourdough to Jewish Rye. All of the breads are certified kosher by the Orthodox Union.
“The key to our success and continued growth is that Heidelberg only produces fresh, artisan breads that are hand-crafted without any chemicals or additives,” Bissell asserts. “We offer the supermarket public a natural and tasty alternative to the mainstream breads.”
The bake shop and café, located in Herkimer, continues to produce specialty items and pastries and serves the retail public.
The Business Journal estimates that the company generates annual sales in the $6 million to $7 million range. Bissell is the sole stockholder of the operating company and the sole stockholder of Cobblescote Associates, LLC., which owns the real estate. As of December, Heidelberg Bread employed 58 people, up from 50 employees in January.
Bissell worked with the Herkimer County Industrial Development Agency which, at its May 2015 meeting, approved a basket of incentives including a 10-year payment-in-lieu-of-taxes agreement, a sales-tax exemption, and a mortgage-fee-filing exemption. The mortgage-recording-tax exemption totaled $52,000 and the sales-tax exemption another $165,000. Cobblescote Associates paid $52,000 for the property, $2.9 million to construct the plant, and Heidelberg invested $1.3 million in machinery and equipment. Adirondack Bank provided a commercial loan for $4.7 million. Bissell says his total investment was well over $5 million.
Construction
“Boyd chose … the [Charles A.] Gaetano Construction Corp. [of Utica] to build the new facility on a design-build basis, which included site, structural, architectural, mechanical/electrical, and the construction,” notes David L. Kleps, VP of design-build at Gaetano Construction. “In its final configuration, the 28,800-square-foot Butler building has three separate areas: dough preparation, 5,760 feet; baking, 8,640 feet: packaging, approximately 10,000 feet; plus room for inventory, offices, a locker room, and a break room.”
Lucas Saltsman, Gaetano’s project manager, adds that “…the ceilings are 25.5 feet high to accommodate a future system of circulating belts designed to cool the bread. The building has a high-R value both in the factory, insulated metal wall (R25) and in the 4-inch roof (R32). The interior wall-surface and roof are designed for a food-processing facility, which means you can even wash down the walls without concern for damaging the insulation. The 6.6 acre site can accommodate a 20,000-square-foot addition for any future offices, baking space, and retail outlet.”
Gaetano Construction used a number of sub-contractors and designers on the project: Alesia Crewell Architects of New Hartford, Kernan Engineering of Oriskany for the mechanical and electrical design, Central Paving of Frankfort for the site preparation, Superior Plumbing & Heating of Utica for the HVAC and plumbing, Associated Fire Protection of Cicero for the sprinkler system, and Boscar Electric of Utica for the electrical work.
Kleps says conversations with Heidelberg Bread began in the summer of 2014, when the company reached out to him. “Heidelberg had been working with a consultant on the project, but there were concerns about the plans he had developed. Heidelberg decided to have us start over and work with Kevin Phillips, Bissell’s nephew, who was the project manager retained by Bissell. (Phillips is currently the plant operations manager and special-projects manager.) Kevin has a background in construction and was familiar with all aspects of the plan: mechanical, electrical, and site preparation. He was also very helpful in handling the paperwork and working with the county to obtain the property as the first tenant in the new business park, securing the tax exemptions, putting together the financing, and handling other legal matters. The project went very smoothly with only minor changes, such as reconfiguring the gas pipes to accommodate the need for low-velocity air diffusion. For Gaetano, there was a learning process, including training the crew to properly install the insulated-metal-panel roof system roof and understanding the installation instructions of some of the new equipment. We broke ground in the spring of 2015 and finished the construction in the spring of 2016. [I’m pleased to say] … the project was on time and on budget.”
Strategic plan
Bissell’s determination to grow the operation is evident from constructing the new facility and the substantial investment in equipment. The automated oven alone cost $600,000, and Heidelberg has already ordered a second oven, which should be installed by June 2017. The company plans to expand its freezer capacity. On Dec. 5, Bissell also hired Phil Kernan as company COO to drive growth. “My focus is on expanding our distribution channels,” Kernan states. “While Heidelberg enjoys good distribution between Albany and Syracuse, we can still improve our penetration there. We are also focusing on expanding our geographical reach to New York City, Pennsylvania, and Massachusetts. (Heidelberg is studying flash-freezing as a method to ensure freshness to distant locations.) There is a growing audience of health-conscious consumers who will buy Heidelberg breads not only at their local supermarket, but also at independent outlets. Another channel for our distribution is restaurants, which cater to patrons insisting on a natural product.” That includes small eateries.
Kevin Phillips explains: “We also have a niche to service smaller restaurants which can’t order in bulk. Heidelberg can mix a batch of dough weighing as little as 65 pounds and freeze the balance not shipped. This allows restaurants to buy only what they need at an economical price. With our new capacity, Heidelberg can also increase its contract manufacturing through private-label production. There are a number of small bakers looking for a manufacturing facility that meets their natural-food standards and can handle the packaging and help with distribution.”
The Heidelberg dream
Bissell, 72, grew up on the shores of Lake Otsego. His path to baking was serendipitous. “As a youngster growing up in Cooperstown, I was accustomed to working long hours,” he reminisces. “At age 14, I worked on a cauliflower farm for 40 cents an hour … In my 20s, I took a sabbatical from college and made multiple trips to Paris, where I spent 2.5 years [collectively]. I worked in restaurants both in France and in the States. I started at the Otesaga [Resort Hotel in Cooperstown] as a ‘kitchen utility’ and later became the chef at a local restaurant. My interest in cooking wasn’t a surprise, because I grew up in a family where both parents were accomplished cooks.”
Bissell says he had an epiphany in 1982. “I drove to Montpelier, [Vermont] to visit the New England Culinary Institute about a staffing position,” the master baker recalls. “The director of the Institute asked me whether I was aware of Upland Bakers, located nearby in Plainfield. He convinced me to visit this bakery, where I tasted the sourdough bread and was frankly astonished: It tasted just like the bread I ate in France. The very next year, I opened my first bakery in Utica and began experimenting with different recipes and flours. I used to purchase baking pans at the Family Dollar Store and shipped unsliced loaves in sacks on the Trailways bus to a customer in Cooperstown. By 1992, our sales volume had grown to $350,000, and I bought the Herkimer … [facility].”
Phillips began his career in baking at the age of 15, when he learned to bake his uncle’s original recipes. He worked for 10 years in construction before returning in 2014 to his original passion, baking bread. As the project manager at Heidelberg, Phillips oversaw the development of the new baking facility in Frankfort. He is currently training a plant manager in order to devote his time to special projects. Phillips grew up and currently lives in Richfield Springs.
Kernan earned a master’s degree in economics from Harvard University and joined Arthur D. Little as a management consultant. He left Little to become director of research at a private-investment bank specializing in equity placements. Kernan also served in various corporate capacities as CFO and CEO. Upon retirement, he taught economics at SUNY Polytechnic Institute. Bissell and Kernan met while serving as trustees of the Landmark Society of Greater Utica. Heidelberg’s master baker convinced his fellow trustee to join Heidelberg with the goal of doubling sales.
The Heidelberg magic
“All breads contain the same basic ingredients — flour, water, yeast, and salt,” avers Bissell. “The magic comes in how you balance those ingredients. It took me years to bake breads that were rich in taste and texture while using only natural ingredients. I can’t recall how many times I have failed while experimenting, but I never stop until I get the perfect balance.”