Anyone affiliated with the baking industry should recognize the name VICOM, but people rarely do. Over time, VICOM has come to recognize that its name doesn't match the brand equity associated with the award-winning pies it produces for Bakers Square and Village Inn restaurants, and other third-party customers. “With a growing proportion of business going to outside sales, we really thought we needed to look at our business differently,” says Tim Kanaly, president, VICOM. “We are now in the process of selecting a new name.” What that name will be remains to be seen. VICOM is the bakery division of American Blue Ribbon Holdings LLC, Denver, which also owns and operates Bakers Square and Village Inn restaurants.

At this year's National Pie Championships, sponsored by the American Pie Council (APC) and Crisco, VICOM won more awards than any other commercial bakery — 53 in total for Bakers Square pies; J. Horner's pies, its frozen pie line for outside sales; and pies made for third-party sales.

In spite of the accolades received at the National Pie Championships, the bakery has been through a tough few years. Its parent company found itself in financial straights a couple of years ago because of declining restaurant sales and high lease rates, and voluntarily filed for Chapter 11 bankruptcy. The company reorganized under American Blue Ribbon Holdings LLC, and re-emerged from bankruptcy seven months ago.

“Filing bankruptcy was a humbling experience,” Kanaly says. “As we come out on the backside, we see the positive things. Today, the company has a very clean balance sheet. We're managing cash flow day-to-day, and we're ahead of our projections.”

At 17.5 million pies produced this year, there is little doubt that VICOM is on solid ground.

No more humble pie

The company's history dates back to 1958, when the first Village Inn Pancake House opened. In the early '80s, Village Inn restaurants became publicly owned and changed its name to VICORP Restaurants Inc. VICORP acquired Poppin Fresh in 1983, and changed its name to Bakers Square. After the acquisition and the creation of Bakers Square restaurants, a decision was made to split out VICORP's commissaries. VICOM became the commissary that supported the restaurants, and only evolved into a full-scale manufacturer during the last seven years.

In 1990, the Bakers Square restaurant chain was voted best in its category and in 1994, Village Inn's sales peaked. “We were feeling like we were at the top of our game; key factors that made it all the more humbling to file Chapter 11 eighteen months ago,” Kanaly says.

“As a result of the restaurants' declining sales and increasing costs, we were not able to meet our financial obligations and had to file Chapter 11,” Kanaly adds. “We were able to clean up our balance sheet and close some restaurants that were under-performing and close restaurants that, over the years, had been pushed into very high lease rates. So, we walked away from lease obligations that were just not conducive to profitability.”

“We didn't hide behind it,” he says. Communication channels with customers and vendors were kept open, and every supplier was taken care of throughout bankruptcy.

“Going forward, we won't make the same mistakes,” says Steven Hawkes, bakery plant manager, Chaska, Minn.

“You have to be very focused on what you're doing,” Kanaly adds. “Bakers Square was about pie. We had to bring our focus back to that. For us at VICOM, we've literally changed our business model.”

The Bakers Square chain is now up by 6 to 7 percent year-to-date. “In today's restaurant arena, that's doing extremely well,” Kanaly says. VICOM's primary obligation is to support Bakers Square and Village Inn, with 33 percent of its pies produced for those restaurants. Still, 67 percent of its sales are for outside customers, not an insignificant number.