Thinking of Buying a Fast-Casual Franchise? Read this report first.

Ones to Watch | By LYNNE MILLER

Bread & Co.
bread and company

Bread & Co. needs to shrink to grow—shrink its number of kitchens that is.

Every week, the Nashville bakery-café prepares and sells 1 to 2 tons of chicken salad, roasts more than 300 pounds of roast beef and nearly 2,000 pounds of turkey breast, mixes more than 50 gallons of sesame vinaigrette dressing, and bakes 5,000 loaves of bread. Bakers go through 550 pounds of butter, 250 pounds of chocolate, and 25 gallons of heavy cream. And in the winter, crew members make more than 100 gallons of soup daily.

It all gets done in three kitchens. Company president John Clay wants to centralize food production into one larger facility that would serve all the stores.

“It’s inefficient,” says Clay, whose mother, Anne Clay, founded the chain in 1992. “Before opening new stores, we’d have to consolidate production facilities into one location.”

But the recession has to end before the expansion can start. When the economy recovers, Clay wants to open more stores, including three or four new ones in Nashville. He’s evaluating other markets, too. While all stores are corporate, Clay has not ruled out working with franchisees. After all, the company has been building a “more franchiseable model, whether we franchise or not,” Clay says. “It makes growing easy.”

Bread & Co. has evolved since debuting as the first European-style bakery in the Nashville suburbs. Back in 1992, the bakery only sold breads, rolls, pastries, and coffee, and there were just 15 seats in the dining room. The company in 1997 and 1998 began experimenting with salads, soups, and sandwiches and in 1999 made the new items a regular part of the menu.

Offering more than bread has paid off. Sandwiches account for nearly 30 percent of total sales with The Iroquois sandwich hitting No. 1. It offers almond tarragon chicken salad with lettuce and tomato slices on cranberry pecan bread and was named “Best Sandwich” by Nashville Lifestyle magazine.

In addition, customer favorites include the Strawberry Fields salad with mesclun greens, sliced strawberries, blue cheese, pecans, and the company’s own Perrin’s Sesame Vinaigrette.

Bread & Co. also makes sure to keep younger customers satisfied as well. It has a special kids’ menu that features staples like grilled cheese, chicken tenders, and fruit. Special pasta dishes ranging from spaghetti with marinara sauce to beef-filled ravioli are also available for dinner only.

Clay joined the company in 1995 and quickly saw potential for growth. He and his mother bought out her two business partners and Clay started his education in bakery management. He trained with the renowned artisan baker Michael London and gained experience first as a store manager then a regional manager. By 1999, he was running the company. Since then he’s focused on building a bigger, more efficient chain of cafés.

Overhauling the catering and wholesale divisions has made a huge difference, Clay says. To better serve customers, Bread & Co. separated the catering business from the restaurants and just last year opened a dedicated catering center.

Bread & Co.


HQ: Nashville, Tennessee


ANNUAL SALES: More than $10 million




As a hub for the catering, wholesale, and gift divisions, the center is staffed with employees who are trained to handle the special requests that come up all the time in the catering business. The company offers special holiday items like sugar cookies, Pumpkin Crème Brûlée, and Chocolate Peppermint Cake.

Furthermore Bread & Co. now relies almost entirely on its own delivery fleet.

Store managers used to get tied up talking to customers on the phone and jotting down orders on paper. Now they put all their energy into store business. Phone calls are diverted to the call center where designated employees answer questions about menu items, resolve complaints, and take orders for pickup. They send electronic orders to the individual stores, where dedicated computer stations receive the orders.

“The combination of the call center and having a dedicated catering department has resulted in improvements in every part of our business,” Clay says. “We’re able to provide a higher level of service on the phone during order taking and better service in order fulfillment and delivery.”

The 5,000-square-foot stores look upscale and modern, with a neutral color scheme highlighted by stainless steel, blond wood, and polished concrete floors. The dining rooms can seat up to 80 people and, on warm days, customers eat outdoors. The average ticket is $12.

“We don’t take shortcuts that would diminish the quality of the product,” Clay says. “As we’ve grown our business, we’ve stayed committed to the artisan process. The way we do things is more time consuming and can be more expensive, but we believe it makes a big difference in the quality of our product.”