If you’ve ever eaten at a McDonald’s in the upper Midwest or Canada or had a sandwich at a Chick-fil-A in the eastern United States, you have almost certainly experienced Baldinger Bakery.
You may not have known it, of course, but Baldinger is the company that produces the buns for those two quick service restaurants as well as several other chains. Baldinger makes hundreds of millions of buns a year. It could, if it wanted to, be a parenthetical in the McDonald’s slogan “Billions and Billions Served.”
It’s the reason that Baldinger CEO Dane Bogaard attended the SAP Partner Business Forum last month, soaking in information about the Intelligent Enterprise and its potential for helping his company grow.
The forum, attended by media, influencers, analysts, partners, and customers, was designed as an introduction to SAP’s transition from digital transformation to intelligent enterprise.
Baldinger is trying to be on the leading edge of the data analytics movement, and if SAP’s current suite of applications can take Baldinger from less than $100 million in revenue a year to a quarter of a billion a year in the next decade, it will be well worth the time and investment in the wave of the future.
“We have optical scanners on our production line that look at the buns and measure height, roundness, color, sesame seeds—everything, you name it,” Bogaard said. “Could all that be fed back in to control the oven? Could all that be fed back in to control the conveyor speeds? It is the same thing with a car like a Tesla, scanning, looking out ahead, putting in real-time data, and then making the product better. It’s the same thing with buns flowing on the conveyor. All of that can be handled the same way.”
Baldinger was a subsidiary of a larger, Chicago-based bakery that, five years ago, sold to a private equity firm. Baldinger’s partners did not want to be a part of that transaction, so the company spun out on its own by acquiring creative financing. It immediately needed its own platform to manage its three plants and meet production demands.
“When we spun out, a gentleman I was affiliated with who works at an SAP partner entity told me, ‘We have a solution. We can do this quick,’” Bogaard said. “He didn’t lie. We were on the system in two months. From a client-server version to the cloud-based SAP Business ByDesign solution.”
Baldinger has a 144,000 square foot plant in St. Paul, Minn., where they are in the midst of adding another production line. The company has smaller facilities in Toronto and Calgary and has recently—and seamlessly—integrated these two Canadian facilities into the core platform. Across the three plants, which constantly run, Baldinger produce around 12,000 dozen buns an hour, each restaurant chain with its own “formula.”
As Chick-fil-A grows and expands in North America and as Baldinger seeks to add more clients, Bogaard sees the potential for the business to double or even triple in the next decade. But he knows he can’t do it alone, and he’s hoping that intelligence enterprise offerings can help them get there.
“Obviously, that growth probably involves acquisition. But, there again, if we have a similar platform that we can use across all the bakeries that we’d have, it would make it far easier,” Bogaard said. “And, truth be told, operators—the people who work in the plant—their job has changed. They are no longer expected to just carry pans from one line to another. They are operating high-tech equipment.
“But it is really hard to get good people. I am not evil; I don’t want to get rid of people for the sake of getting rid of people, but if we can engineer out some of those inefficiencies, engineer out the people we just can’t get, and do it through technology and integrate that with our enterprise resource planning, the better off we are going to be.”
Bogaard attended the SAP Partner Business Forum to learn about how Baldinger can do this: “We are just at the beginning. We are not there yet, but we do want to get there.”
Frank Hughes is a Silicon Valley-based freelance writer and editor covering the tech industry for SAP.