Sandra and Georg Heberer: Wiener Feinbäckerei: “Nobody buys a sandwich for six euros”
Frankfurt At the busy Hauptwache S-Bahn station in downtown Frankfurt, commuters queue up at the Heberer bakery for sandwiches or a sweet treat for on the go. This is what the Wiener Feinbäckerei is known for with a good 200 branches. “For us bakers, the nine-euro tickets are the best starting aid after two years of the corona crisis,” says Georg Heberer, who is the fifth generation to run the bakery chain with his sister Sandra.
Sandra Heberer reports: “Especially our branches at train stations, airports and city centers were our problem children during the lockdown.” Customers often bought their daily bread from the baker in their neighborhood and were less on the go. High-margin snacks such as sandwiches, slices of pizza and coffee were slow sellers in the home office era.
“Many locations are now running like before the Corona period, but shopping centers are still weak,” says the 34-year-old. “Even if people only go to the office for three days, they treat themselves to a little more at the bakery than they used to.” The average receipt is 4.35 euros, 35 percent higher than before the pandemic, also because the bakery has raised the prices . “However, our raw material costs have grown significantly more,” Georg Heberer clarifies.
Just at the beginning of the pandemic, the siblings took over the management of the bakery that their great-great-grandfather Georg founded in Offenbach in 1891. His son did his apprenticeship as a baker in Vienna and brought the pastries to Hesse from there. “In the short time you have to overcome such significant problems that have not existed in the last 30 years,” father and uncle tell the siblings.
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Because since the Ukraine war, the costs of energy, flour and butter have risen rapidly, and supply chains are out of sync. Consumers are watching every penny because of inflation. And now the Russian gas that the bakery needs for its ovens is also threatening to fail.
Shortage of goods: Heberer has to streamline the range
Because the Ukraine is no longer an important export country for wheat, the flour prices for the baker have doubled. Butter prices have almost quadrupled. “As bulk consumers, we sometimes buy butter more expensively than private customers in the supermarket,” says Georg Heberer. Because the long-term contracts of the retail trade would usually be served with priority.
Butter, milk and cream are also scarce. For a while there was no boiled egg to fill with. “The biggest problem is the availability of the ingredients, the price comes second,” says Sandra Heberer. “After all, we want to remain able to deliver.”
However, the bakery has already had to streamline its range due to the high costs. “Some roll toppings have become so expensive that the price would be unacceptable for customers. Nobody buys a sandwich for six euros – except maybe at the airport,” says the business graduate, who previously worked at Tchibo, among others.
The company is also concerned about Russian gas. Engineer and master baker Georg Heberer is currently checking whether the ovens in the main factory in Mühlheim can be operated with pellets. “In an emergency, we will bake more in the electric ovens in our branches, but then we will have to greatly reduce our range. We were systemically important during the pandemic, now this is no longer certain,” the baker is surprised.
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Even before the Ukraine war and the pandemic, the industry and the Heberer bakery were struggling with problems. Because cheaper self-service bakers and discounters are increasingly competing with traditional artisan bakers. Their number has fallen in the last 60 years from around 55,000 in the old Federal Republic to 9,965 companies with around 35,000 branches in today’s Germany. According to the Central Association of German Bakers, every household consumes around 56 kilos of bread and baked goods a year. Before the pandemic, industry sales even rose slightly. In 2021, at 14.89 billion euros, it was still below the level before Corona.
Traditional bakers like Heberer, who still dig out the bread dough by hand, have a hard time asserting themselves against the cheaper competition. But the heyday of the big baking chains is also over. After the fall of the Wall, Kamps had overreached itself with over a thousand branches and was first bought by the pasta manufacturer Barilla and later by financial investors. Since 2015, the around 400 Kamps branches have belonged to the French large-scale bakery Groupe Le Duffe.
Werner Motyka from the Munich Strategy consultancy states: “The business with bakery branches in this country is complicated and driven by operational excellence.” A national or as large a network of bakery branches as possible is no longer a strategic goal.
The Wiener Feinbäckerei once had 500 branches. “Twenty years ago we realized that a bakery cannot be part of a group. This is a suburban business. A large logistics network is too complex,” summarizes Georg Heberer. During the pandemic, production in Weimar was forced to close. “Even before Corona, the utilization was too low,” explains Sandra Heberer.
“My brother and I would have really wished for a nicer start as an entrepreneur.” All 70 employees would have found work elsewhere, she assures. Today the Heberer Group has 340 employees, including those of the independent partners there are around 1300.
Regular customers subscribe to Heberer bonds
The bakery chain is still suffering from the consequences of post-reunification expansion. According to the Federal Gazette, the liabilities were 15.7 million euros at the end of 2020. In order to become less dependent on banks, the bakery issued its first five-year bond in 2011. In 2021, the third bond could be closed two months before the deadline – although shareholder protectors generally warn of the risk of a total loss of corporate bonds. “Mainly regular customers from the Rhine-Main area subscribe to our bonds. These are now very important for customer loyalty,” says Sandra Heberer.
The loyalty of the bond subscribers is great, even though sales in the first year of the corona virus fell by ten million to 51 million euros. The bakery made an annual loss of 5.3 million euros and, in addition to corona aid, applied for a KfW loan of seven million euros. “In 2021 we were a little better off despite the lockdowns,” says Sandra Heberer, without naming any numbers.
In order to make itself fit for the future, Wiener Feinbäckerei is pursuing two strategies today: On the one hand, it supplies more major customers than in the past. These include restaurants, other bakers, but also supermarkets such as Aldi Süd. “In this way, we are expanding our customer base without cannibalizing our branches,” emphasizes Sandra Heberer.
On the other hand, Heberers are converting more and more sales counters into cafés. In the Café Carlotta under the Frankfurt Hauptwache, for example, you can have a hearty breakfast or eat cake. Georg Heberer says: “Nowadays, a bakery must not only fill you up, but also invite you to linger.”
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