Business Monday

Pagnifique bakery bakes up an empire

IN MIAMI-DADE: Fernando Abella, managing director of Pagnifique, poses with some of the company’s various bread products. ‘We are working to be the best bread-maker in Florida,’ he said.
IN MIAMI-DADE: Fernando Abella, managing director of Pagnifique, poses with some of the company’s various bread products. ‘We are working to be the best bread-maker in Florida,’ he said. Miami Herald Staff

When you buy a baguette at Winn-Dixie, bite into a steak sandwich at the Argentine-style bistro Novecento — or choose a multi-grain roll from their basket at your table — you are tasting bread baked by Pagnifique.

Each day, the South Florida company sends out truckloads packed to the brim with boxes of freshly made bread that has been mixed, baked, cooled and then frozen at its facility in Miami-Dade County. The loaves, rolls and baguettes are then quickly finished in the ovens of supermarkets, stores and restaurants, to be sold or served throughout Florida and beyond.

“We are working to be the best bread-maker in Florida,” said Fernando Abella, Pagnifique’s managing director.

Pagnifique sells to 2,400 stores and restaurants in Florida and around the country, including major retailers like Walmart, Publix and Winn-Dixie. And since last year’s sale of 85 percent of the company to a Chilean private-equity firm, much more aggressive growth is on the way.

At its high-tech baking operation in Northwest Miami-Dade, bread-making is serious business. Pagnifique churns out 6,000 baguettes per hour, 24 hours a day, Monday through Saturday. That’s 53 million baguettes per year.

Pagnifique has invested $15 million in its machinery, which comes from France, Italy and Germany. As a result, Abella said, work that would require a staff of 100 at a traditional bakery requires only eight people per eight-hour shift.

“In a traditional bakery, you need many people to make the dough,” he said.

Inside the facility, workers dressed in white coats, with caps on their hair, oversee the fully automated process. Each day, the equipment is oriented toward a certain bread: traditional French baguettes, multi-grain, whole wheat, ciabatta and rustic bread (the kind that looks handmade).

Ingredients like flour, salt, yeast and water are churned inside huge mixing machines to create the dough. The machines are so top-secret and the mixture is so proprietary that they could not be photographed. It takes only minutes for huge batches of dough to be formed. On a recent Wednesday, for example, the plant was geared toward multi-grain baguettes, which took less than half an hour to mix.

The freshly mixed dough is carried on a conveyor belt that smooths it and forms it into baguette shapes. A laser checks the length of the baguettes before they are loaded into an enormous oven that is the size of a room, to be baked until they are 70 to 80 percent finished.

Then the rolls are automatically relayed to a cooling area — rich with the smell of freshly baked bread. There, the baguettes swirl around on one of 20 cooling rows that rise about 36 feet upward toward the ceiling. Once the bread is cooled, it is frozen. Then a machine scans the quantity and drops 55 units into each Pagnifique box.

The entire operation, from mixing to freezing, takes four hours. A total of 50,000 breads are in varying stages of the operation at a given time, Abella said.

“We sell products that are very easy to finish in the supermarket, that don’t need a lot of work,” he said.

That’s one key to Pagnifique’s success, Abella said, as are the company’s European recipes and its attempts to make healthy breads, like multi-grain and flax ciabatta.

Despite Americans’ fickle feelings about carbohydrates, bread remains a $10billion-plus industry in the United States, according to figures from Nielsen. By volume, bread consumption grew 2 percent from July 2013 to 2014, Nielsen’s figures show.

The recession didn’t put a dent in bread-making, either. The number of commercial bakeries in the United States rose from 2,578 in 2007 to 2,662 in 2012, according to U.S. Census figures, although the number of employees dropped to 115,147 from 142,510, perhaps reflecting job cutbacks or increased automation.

With a supermarket price of about $1.50 for a baguette, consumers probably still view bread as a bargain.

“We grew during the recession because people didn’t go to restaurants, they went to the supermarket,” Abella said.

Though Abella declined to provide revenue figures, he said revenue is up 50 percent this year compared to 2013, and 2013 was up 45 percent compared to 2012. Sales are projected to rise 42 percent in 2015. New customers are driving the growth, he said.

Pagnifique was founded in Montevideo, Uruguay, in 1994, where it still operates three baking facilities that produce three times the amount made in Miami, Abella said. From Montevideo, the bread is sent to supermarkets, stores and restaurants in Uruguay, Brazil, Argentina, Chile, Paraguay and Peru.

In 2003, Abella started the company’s operation in the United States. As an owner of a supermarket and restaurant in Montevideo, he had been a customer of Pagnifique, and was familiar with its products.

“We started talking about the idea to start an operation in the U.S., and we started a partnership in the U.S.” said Abella, who became a 10 percent owner of the U.S. operation.

Pagnifique opened its Northwest Miami-Dade facility in 2012. From there, boxes filled with freshly baked, frozen bread are trucked to Doral, where Pagnifique maintains a logistics center. Trucks then take the boxes to supermarkets, stores and restaurants. About 70 percent are in Florida, with the rest in other states, mostly on the East Coast, Abella said.

Pagnifique distributes directly, and also works with major distributors like Sysco, Gordon Food Service and U.S. Foods, he said.

Locally, in addition to Walmart, Publix and Winn-Dixie, Pagnifique breads are sold at Sedanos, Epicure Market and restaurants like Graziano’s and Novecento.

For sandwiches, Novecento uses Pagnifique’s French baguette, and for baskets at the table, multi-grain mini-baguettes. The bread is served at all its locations in South Florida — Brickell, Aventura, Key Biscayne and, soon, in Midtown, where Novecento is opening within a week.

“We know the Pagnifique people for a long time,” dating back to Uruguay, said Juan Rocco, Novecento’s partner and regional manager for the United States.

“It’s a combination of quality, service and price,” he said, citing the reasons he likes Pagnifique, adding that Novecento has also served its bread at its two restaurants in Uruguay, ever since the first one opened in 1996.

Private-equity investors also wanted a slice of the bread.

In October 2013, Pagnifique’s owners, including Abella, sold 85 percent of the company, both in Uruguay and in the United States, to Linzor Capital Partners, a private-equity firm based in Chile. The company invests in businesses across many industries in Latin America.

Abella declined to disclose the amount paid, and Linzor did not return a request for comment. Yet a November 2013 article about the deal in América Economía, citing sources close to the negotiations, valued the company at about $80 million.

The new backers are providing Pagnifique with the capital needed for aggressive growth.

In January 2015, the company will expand distribution in Mexico, where Pagnifique already ships truckloads to Walmart, restaurants, hotels and supermarkets, Abella said.

Then, in March, Pagnifique will invest $15 million to begin construction of a second line of machinery at its Miami-Dade site, which will allow the company to more than double its production starting in January 2016. Once the second line is added, Pagnifique will be able to produce 16,000 baguettes per hour, 24 hours a day, six days a week, Abella said.

“It’s a very big market in the U.S.,” he said, “and we need more production to expand our sales.”

Pagnifique

Headquarters and baking facility: 12050 NW 28th Ave., Miami.

Founded: 1994 in Montevideo, Uruguay (where it operates three baking facilities); opened U.S. operation in Miami in 2003.

Distribution: United States, Mexico, Uruguay, Brazil, Argentina, Chile, Paraguay and Peru.

Current ownership: Privately owned; Linzor Capital Partners bought 85 percent of the company for an undisclosed amount in October 2013. A November 2013 article about the deal in América Economía, citing sources close to the negotiations, valued the company at about $80 million.

U.S. top executive: Fernando Abello, managing director.

Employees: about 70 full time.

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