NEW YORK (WCBS 880) — The macroeconomic effects of the COVID-19 pandemic are measurably impacting local businesses, their workers and their customers.
Rising commodity prices and the labor shortage are two of Liv Hansen's biggest challenges at The Bakehouse in Ardsley and Tarrytown. It's now forcing her to rethink her traditional business model at her family-run bakery.
"Some of the foods we buy are up 8 percent," Hansen told Joe Connolly and Neil A. Carousso on the WCBS Small Business Spotlight, sponsored by Dime Community Bank.
The Bakehouse is known for its custom homemade cakes. They also sell a variety of baked goods, sandwiches, soups, and even, pot pies. Hansen and her husband took over the Ardsley location at 660 Saw Mill River Rd., known as The Riviera, from her mother about 10 years ago. The Riviera Bakehouse has been a community staple since 1950.
The bakery business in Ardsley had been thriving before the pandemic, attracting customers from Westchester, Rockland and the surrounding areas. In March 2020, Hansen opened a new location inside the former Metro-North station building only to shut down when the coronavirus emerged the same month. They anticipate sales of breakfast goods and treats will spike when more Manhattan commuters pass through.
"We're hoping as the city opens up that the commuters are up in full force," Hansen said.
But, The Bakehouse is struggling to find enough skilled workers to make the volume of homemade custom cakes they churned out pre-pandemic. Currently, they employ four full-time workers and three part-time workers. They had been down to two workers at the height of the pandemic.
As a result, Hansen is expanding her website with "semi-custom" homemade cakes to order for occasions from graduations to weddings to birthdays.
"We hope that in the future, that will become our main source of orders," she said. "It is much more efficient for us because we see what's coming in really quickly rather than having people place the orders via phone and have a hand-written order."
Even traditional businesses like bakeries have been disrupted by the pandemic. It's become essential for The Bakehouse to streamline operations and make more cookie-cutter products with a selection of custom features to grow profit margins.
Hansen has also found cost savings in ingredients. When matzo meal became unavailable, The Bakehouse took one of their popular chocolate cakes of the shelves and developed a cake-like brownie special from a current recipe.
"Really, it's cake, but it's a very moist cake and we top it with different things," she explained. "We have an Oreo one, just a plain fudge one, we have one with sprinkles, one with peanut butter butter cream, and we sell them as brownies.”
Since kitchen staff at The Bakehouse make the chocolate cake daily anyway, it saves time, labor and commodity costs, and increases their margins with an additional tasty dessert on the menu.
“It has made a great efficiency for us,” said Hansen.
See ideas to make yourself sustainable in the post-pandemic economy and grow profit margins on the Small Business Spotlight video above.