By Nadine Zylberberg
Zak Stern runs the eponymous Zak the Baker in Miami’s Wynwood neighborhood. His bakery endures annual hurricanes and survived Zika (Wynwood was dubbed ground zero for the outbreak in 2017), but COVID-19 brought on a whole new set of challenges. At the start of the pandemic, Zak shifted his operations toward home delivery, creating an entirely new menu and mode of production.
My first feeling when coronavirus hit was fear—fear of getting sick, fear of the company’s finances. Those are two major things that were stable not long ago, and all of a sudden, they became completely unstable. The unknown element made it terrifying.
We immediately had to close the cafe, and we opened up a pickup window. The second week, we had to lay off our entire front-of-house cafe team.
Simultaneously, all of our wholesale accounts started dropping because they all started closing as well. We bake for hotels, restaurants, and cafes. That division of our wholesale department basically went from 100 percent business volume to 80 percent to 40 percent to 20 percent to 4 percent over two weeks. The Whole Foods side of our wholesale department stayed stable. That was a lifeline for us. Very quickly, we realized that this was not going away, and we needed to adapt immediately.
We’re just trying our best. There are going to be some wins, and there are going to be some losses. But because we’re independent, we have no choice. We have no partner to lean on, so we have to make this work, or we’re going to crumble.
Home delivery is something that we’ve never done before. When we first launched, it looked like a shitshow. I mean, we had to become Instacart overnight, and the inventory was so difficult to keep track of. We weren’t making enough, or we were making too much. It’s a 52-hour process for bread, so we were producing for two days away, and customers were ordering the day before. We had no analytics to guide us. It was such a mess.
Imagine launching a whole new department overnight. We were building the plane as we were flying it, basically. I think that Amazon and Instacart and Uber have done such a good job that when a little local guy tries to play their game, we need to be at their level. We need to be using their tools. They’ve just made it intuitive and clean and stress-free.
You should have seen the first Friday. There were bags of orders everywhere, and our ordering system didn’t organize it well, and we might’ve had 13 different cars out because everyone was trying to correct mistakes and re-deliver orders. I was on the phone the whole time, apologizing to people, telling them, “I’m so sorry. We’ll figure it out. Here’s a refund. Here’s a gift card. Try us again next week. We’re doing the best we can.” I must have sent out five or six apology letters per day the first few weeks.
I’d just refund right away and send a gift card because I want them to try again. I don’t want them to be burned by their first experience from us while we’re just figuring it out. So it was humbling, man. It was hard.
Managing customers’ expectations took some time for us to figure out, but we got it now. What we finally have come to—and we’re still evolving—is clear commitment times of windows when we’re delivering, and then lots of text message notifications that explain when the order is being prepared, when the order has shipped, and when the order is 30 minutes away.
What was stressful for people, and I understand, is they would place an order—they’re relying on that bread for their Shabbat dinner—and they didn’t get a notification that it was being packed. They only got a confirmation that we accepted their money. And sometimes, we actually missed orders because there were holes in the system, and we were still figuring it out, and they’d never get their bread. Whether it’s a marriage or a friendship or a consumer and a producer, there needs to be communication. The more transparent communication, the better.
It took some time to figure out how to get cold items to houses at the right temperature in the heat of summer, so we had to source the proper thermal insulated bubble bags, and then we had to try out different ice packs. These are all logistic things that no one thinks about—and they don’t have to think about—but we had to learn them very quickly.
We made a whole new menu of prepared foods by the pound to compliment our bread and pastries. The cafe menu that we were making wasn’t really adapted to what people needed—two eggs, labneh, and avocado on a breakfast platter doesn’t really speak to home delivery. We need to be more focused on commodities and basic needs, and less on dining out. I think that’s a sector that we can speak to. We’re a bakery. Even though we’re an artisan bakery, we’re still pretty approachable. A croissant costs $3.20, and that’s very different than going out and having a $150 bill for dinner. People can still enjoy that, even in the middle of a crisis.
Where it used to take six months for a product to launch, now we were launching things from one day to the next. We held a monster R&D lightning round, just adapting at warp speed. We were trying things, tasting them, and saying, “Okay, launch.” It’s really a creative process, but we were doing this on the fly. We weren’t sitting down and having meetings. It was all hands on deck.
We used to make hummus once a week on Fridays. Now, all of a sudden, we needed to adapt our kitchen to make it every day. What once seemed so difficult, the next day, we had no choice. Then, we had all of these local tomatoes we weren’t using in the cafe. We’re like, “All right, we want to keep buying all the tomatoes from our local farmer, so—bruschetta.” It was a combination of using what we had in-house and making things that we thought the market wanted. With handmade food, we can only scale at a certain pace. We’re limited in people, and in hands.
We ordered 15 pallets of flour because we didn’t know if the distributors were going to close down. We ordered enough flour to last us for three months to stay open. What used to be our cafe dining area was just lines of pallets of flour that we used as makeshift desks. Each one of us had our own pallet because we had to be six feet away from each other, and we would have meetings on the fly.
It was pure production all day long, whether it was in the bread department, whether it was customer service up front, whether it was in the kitchen, whether it was our online store. At the end of day, at our three o’clock meeting, we talk about everything that went wrong, and then we try to fix it the next day.
It just took an extreme amount of creativity and so much energy from our team, working seven long days a week and just hustling. It felt like we were starting up a business from scratch. It reminded me of the early days. The only difference is, in the beginning, I was alone. Now, I’m surrounded by a bunch of champions. Now, we are adapting fast, and we’re able to meet the demand because all of our team is hunkered down and making it happen.
I would say we did it, but just to be fair, we’re still at 50 percent of our business volume, and we’re still not breaking even—that’s our goal. So we’re still innovating and doing R&D and trying to be relevant. If we can get to break-even, then we can ride that out until hopefully things come back.
The reality of being an indie business in the middle of a crisis is that it takes a lot of energy to keep things going. It’s hard, and sometimes it takes some serious self-sacrifice. I have kids, I have a family too, I have an income from the bakery too. And so I’m like everyone else, fighting to keep our incomes. Shutting down wasn’t an option for me.
Out of the challenges come a lot of opportunity and a lot of revelation. All of a sudden, the bakery now has a new department called home delivery, which was basically our catering program. It’s now a full-blown business. And our wholesale is going to get much smaller. We’ve become much lighter and more technology-focused with more systems online. It’s created a much more efficient company. So there are plenty of silver linings I think. It’s just stressful to do it so quickly with such lack of visibility. When something is blowing up, it really reveals what’s possible.