KEVIN LEININGER: List of ingredients in Aunt Millie’s closing is long and complex
John Popp can’t say it would have changed this week’s announcement, but it’s worth remembering that eight years before Aunt Millie’s decided to close its Fort Wayne bakery it was planning a $400,000 expansion Popp said would have solidified the company’s commitment to downtown.
“We’re tight as a drum right now. I have a full-time employee who does nothing but move trucks around (to provide needed loading space,” the company president told me in 2009 when he asked City Council to close a section of Pearl Street in front of his plant to make room for the additional loading bays he said would “make us more efficient.” But the requested closure never happened, and the wisdom of the decision has been rendered moot by the imminent loss of 91 jobs and a heavenly industrial aroma not even the Obama EPA would have wanted to regulate.
I mention this not to retroactively browbeat council or to absolve Aunt Millie’s for a perceived lack of commitment to the city it has called home for the past 116 years (120 office jobs will remain), but to point out how not even economics is immune to the laws of physics. Actions produce reactions — as Popp has learned only too well since Aunt Millie’s decided to open a $25 million bakery in Lake County two years ago.
Business was booming at the time, Popp recalled, and the bakery in Lowell — Aunt Millie’s seventh — was needed to serve the nearby Chicago-area market. Now, he said, the food business “is in turmoil” thanks in part to the bankruptcy of Chicago’s Central Grocers and Indiana-based Marsh Supermarkets, some of which were bought by Kroger, which doesn’t need Aunt Millie because it operates its own bakery.
The additional loss of a deal to produce buns for Wendy’s restaurants in Indiana, Michigan and Kentucky and other factors created an overcapacity that made seven bakeries a luxury Aunt Millie’s could no longer afford. One facility had to go, and the aging local bakery — which Popp said increases distribution costs by about $1 million per year because of its distance from major highways — was the logical if difficult choice.
“I wish it didn’t have to happen and was choking up (when telling employees about the closing),” Popp said. “The fact that this is our home town makes it emotionally harder. But we have 1,700 employees. I need to take care of them, too.”
That’s an important point that shouldn’t be lost. Even with the closing, Aunt Millie’s will still be the nation’s fourth-largest bread-maker, with bakeries in Indiana, Michigan and Ohio in addition to more than 50 branch depots and 35 outlet stores. Businesses that aren’t efficient don’t produce profits, and businesses that aren’t profitable can’t afford the equipment and employees needed to remain competitive. Had City Council improved Aunt Millie’s efficiency in 2009, “It might have helped” save the local bakery, Popp said — but may have only postponed the inevitable. You just can’t beat physics.
That’s worth remembering as people seek half-baked answers for complex questions. In addition to the Aunt Millie’s announcement, this week also brought word that another downtown business, the high-end Golden restaurant, will be closing. In both cases, some — even in the media — suggested the decisions call into question the success of downtown redevelopment. But that’s nonsense. Unique personal and business considerations factored into each decision, and I have no doubt another and more-competitive restaurant will soon grace the Golden’s highly visible spot in the Ash Brokerage building.
As for the Aunt Millie’s property, its proximity to The Landing and the riverfront has attracted the interest of city officials who say they would be interested in talking with Popp about possible acquisition. The property’s potential value didn’t affect the closing decision, Popp said, but he acknowledged it has been “an afterthought.”
In other words, businesses come and go, and so long as the overall business climate is sound — and it is — individual closures probably have more to do with unique circumstances than with impending economic doom. But I do have to admit: Working just a block or two from Aunt Millie’s, the looming sensory deprivation could be devastating.
This column is the commentary of the writer and does not necessarily reflect the views or opinions of The News-Sentinel. Email Kevin Leininger at email@example.com or call him at 461-8355.