Volume FDQ 1 | Issue 1 | Year 2005

In the film “Sideways” there’s a wonderful soliloquy about the journey wine takes from grape to glass. But wine is not the only finer thing in life that undergoes an odyssey in order to reach our dinner table. Take, for example, the high-quality baked desserts of Sugar Bowl Bakery™. This company, begun by the five Ly brothers in 1984, a mere five years after they arrived in America after escaping from Vietnam, is ranked number 14 on the AC Neilsen list of companies specializing in baked goods. And with good reason: its products elicit reactions of admiration that awaken more than taste buds.

On two recent social occasions, I had the opportunity to hold forth on the story behind Sugar Bowl Bakery™. While guests gushed about the taste of several Sugar Bowl Bakery™ goodies, I relayed my fascination with the intrepid Ly brothers. I recounted how they worked 16-hour days to eventually pool $40,000 to buy an old donut shop in San Francisco. How they studied English and business, how they sacrificed and expanded from retail to wholesale to specialty baking, and eventually landed distribution agreements with national and international warehouse clubs and grocery stores, which is how their products wound up in the hands of my dinner guests. It was then that I realized that if wine doesn’t just grow on a vine, then Sugar Bowl Bakery™ products don’t just come from an oven. As Andrew Ly, CEO of Sugar Bowl Bakery™, likes to say, “Success is a journey not a destination.”

Yet while everyone appreciates a rags-to-riches success story, no product can succeed if the public doesn’t like it. No problem, at least based on my modest observations from the field. Whether it was the exotically fresh taste of the Petite Palmiers®?, the surprisingly rich, yet light sensation of biting into a Madeleine, or the indulgent yet perfectly sized chocolate treat of the aptly titled Petite Brownie Bite, I can personally attest to the effusive, positive reactions people have for Sugar Bowl Bakery™ products.

While words somehow fail to describe the taste of the company’s major retail products, here’s a few to provide the suggestion of a taste. Buttery and flaky, Petite Palmiers®, Sugar Bowl Bakery’s signature French cookie, are kosher certified with no preservatives, artificial flavors or transfats. Madeleines are petite French cakes shaped like seashells that are baked to be firm yet delicately crunchy. And Petite Brownie Bites are mouthwateringly decadent, ideal for chocolate lovers. It’s no wonder that large retailer outlets carry these treats, and even less wonder that demand for them steadily increases year in and year out.

Diversified delights
The Ly brothers’ collective persistence is remarkable, but their vision is the stuff of business genius. Not content to simply own a single retail establishment, the brothers set their sights on expansion. Five years after they purchased their first commercial property they once again pooled their funds, this time $90,000, to buy another property in 1990. This move paved the way into wholesale and soon Sugar Bowl Bakery™ products were being sold in 7/Eleven stores and other coffee shops in the region. Today, more 250 Sugar Bowl Bakery™ products, including muffins, danishes, tarts, cakes, and pies, are sold wholesale. But the expansion didn’t stop there.

The brothers discovered that there was a demand for laminated dough in Las Vegas. According to Laura Ly, Director of Public Relations, laminated dough allows for constant folding, which in turn enables a baker to make elaborate treats such as croissants. Capitalizing on this need, Sugar Bowl Bakery™ began a frozen dough division complete with a fleet of trucks serving its primary customers – Las Vegas casinos – as well as other establishments throughout Northern California.

“Sugar Bowl Bakery’s Frozen Division offers convenience and fast preparation to our customers who are short on time,” said Ly. “Our same high-quality pastry goods can be packaged and delivered frozen and ready to bake. These frozen goods create flexibility because they can be baked off at any time without sacrificing their great taste. Our frozen lines of products are made with the same fresh ingredients and the highest quality ingredients available.”

Next Sugar Bowl Bakery™ wisely expanded into the high-end wedding/specialty cakes business. In fact, another second generation Ly, Kevin, became a world-class pastry chef and the creative leader of the division. “A Sugar Bowl Bakery wedding cake will be remembered for both its beautiful design, as well as for its exceptional quality. On a day when everything should be perfect, we offer wedding cakes of impeccable taste. My cousin, our executive pastry chef, has professional culinary arts training along with his expertise in innovative designs to create a specialty cake as unforgettable. His expertise enables Sugar Bowl Bakery™ to provide customers with exquisite works of edible art.”

Fresh approach
The San Francisco Business Times has named the Sugar Bowl Bakery™ the fastest-growing private company in the Bay Area an astounding 10 out of the last 11 years. Not only is that a testament to the company but to its traditional attitude toward hard work and persistence, which are constantly espoused by Andrew Ly. Moreover, there is something equally old-world about the company that’s found in the fine print detailing each product’s ingredients.

In today’s preservative-oriented world, Sugar Bowl Bakery™ sticks to the basic ingredients that are the hallmarks of freshly baked treats. Butter, sugar, eggs, fresh fruits and cream. Nothing new about such staples, except, of course that too few large bakeries use them anymore. Therefore, if the company’s business success is old school, the popularity of its products stems from being old-world. Perhaps that explains the emotional letters and email messages sent to Sugar Bowl Bakery™ from consumers around the country.

For example, a German-born woman expresses her relief to have found, after 40 years away in America, the long lost taste of her homeland: a “pig’s ear” (also known as “elephant’s ear”), meaning the Sugar Bowl Bakery™ Petite Palmier®. A home schooling mom so entranced by Madeleines requests a tour of the Sugar Bowl Bakery™ for her children – talk about an educational treat! Meanwhile countless people ask if Petite Brownie Bites can be sent directly to their homes.

“It may be a cliché to say that we use fresh ingredients, but the proof is in the taste,” said Laura Ly. “My family has never believed in short cuts and our products reflect that and consumers respect that. As my Uncle Andrew likes to say ‘It takes years to build a good friendship and seconds to lose one,’ so we keep that in mind in everything we make and do.”

Recipe for success
The Ly brothers’ patience, persistence and competitive spirit has transformed a failing donut shop into a $35 million company that averages more than 20 percent growth per year. Once a modest retail concern consisting of the Ly family serving a small pocket of the public, Sugar Bowl Bakery™ products are made by more than 300 employees and are now consumed by millions of people in the United States and beyond. And more of the same is to come.

According to Andrew Ly, Sugar Bowl Bakery™ has further expansion in mind. “We are constantly striving to improve, which means bringing new products to market and exploring opportunities in new markets,” said Ly. “We are also always seeking opportunities to purchase or build new manufacturing facilities in different regions.” And in addition to expansion, there is another stated goal: an initial public offering. There’s no specific plan or date set for that event, but if determination and flavor could be quantified in a prospectus, Sugar Bowl Bakery™ would be a sure buy.

With its multiple divisions – retail, wholesale, frozen, and wedding/specialty – Sugar Bowl Bakery™ is well balanced for stability and poised for further growth. But at the end of the day, the company will continue to succeed because, like the products it bakes, it has the right ingredients. And one last thought, since I mentioned the end of the day… leave room for dessert, especially anything made by Sugar Bowl Bakery™.

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