Beechworth Bakery
Australian Government 2005

Tom OToole was brought up in poverty in Tocumwal, in rural New South Wales, and dropped out of school at the age of 14 years, with no literacy or numeracy skills. Today, with his wife Christine and staff shareholders, he is proprietor of the retail bakery with the largest turnover in the Southern Hemisphere the Beechworth Bakery and one of the most sought after motivational speakers in Australia. The Beechworth Bakery is a sensational rural business success story in terms of turnover, job creation, visitor attraction, and positive impacts on what was once a moribund community. It is credited with revitalising the town of Beechworth, turning around its ailing economy. It has become a national business icon and an inspiration to rural communities and businesses throughout Australia, New Zealand and South Africa.

Torn OToole, the legendary Beechworth Baker, began life and employment in the New South Wales country town of Tocumwal. In his words, 'I failed kindergarten, and when I left school at 14 I didn't know my ABC or my times tables, and I still don't!'. He managed to get a baker's apprenticeship at the local Tocumwal Bakery only because, as he says, 'No one else would take it as you had to get out of bed at two in the morning'. By the age of 21, Tom was managing an Aboriginal bakery in Maningrida, in Arnhern Land in the Northern Territory. Then began a series of business ventures, first in Yarrawonga and Beechworth in Victoria and then in Augusta in Western Australia. Returning to Beechworth in 1984, Tom found a depressed community and local economy. He reflects in his autobiography, Today people say, 'Geez, wasn't Beechworth smart saving all its heritage and its history'. It wasn't the bloody smartness of the town, it was bloody poverty. No one would spend any money on the town. It was a town that was slowly dying. Today it's very much a tourist town, but it's still on a road to nowhere. Sixteen years ago, when I bought the Beechworth Bakery for the second time, people didn't say 'I'm going for a drive to Beechworth unless they were going to visit Mad Aunty in the lunatic asylum or one of the relations in the jail. Sixteen years ago it was a government town ... Look at Beechworth today. It's a hive of activity on the weekend. But when I came to town 16 years ago, those shops were all boarded up'. The struggling milk bar and cafe Tom bought in 1984 epitomised the sad state of Beechworth: it employed two part-time staff and had an annual turnover of $100,000, the business was bankrupt, and the building was full of mice and rats, and a possum living in the kitchen ate the vegetables intended for pasties. Tom says, "There was a health order on the place and it was going to close, but I wanted to buy it because I saw the potential of the tourist dollar. I went to my bank manager, who said, "You're bloody mad. This town is dying". I changed banks". Tom opened the business with five staff and within three months was employing 23 people. Today, for a bakery located three hours from a capital city and on 'a road to nowhere', the business achievements are quite remarkable:

 •   the largest turnover of any retail bakery in the Southern Hemisphere

•   680,000 customers a year

•   the ability to seat 200 customers

•   $30,000 taken on one day (on Easter Saturday in 2003) and $140,000 in a seven-day period

•   winner of a host of state and national business awards.

The impact

Business and employment success

Effects on Beechworth

The Small Town Renewal Kit names Beechworth as a wonderful example of small town revitalization. The authors have no doubt about the origins of that revival.

The Beechworth Bakery's impact on Beechworth and its business and employment basis is impressive. Its success has activated a chain reaction in the town. Today the town is a major tourism centre and, despite the dramatic closure and job rationalization within its public sector (eg, the Mayday Hills Hospital has closed with the loss of 500 jobs), Beechworth is growing in population and employment opportunity and diversity.

The Beechworth Bakery's role modelling of best practice in terms of marketing, merchandising, business appearance, product range, cross-promotion and entertainment, and its subsequent financial rewards, have permeated the Beechworth business community, and the town is now a fine example of local business vitality. Today Beechworth is, in Tom's words, 'No longer a place for only the mad, and the bad, and the sad, and going nowhere'. It has become 'a major tourist centre that is expanding in population and employment opportunities and becoming a more diverse economy'. In addition, the Beechworth Bakery has been a key supporter and leader of special events in the town, as a means of attracting visitors. The Bakery is an active participant in and contributor to such events as the Celtic Festival, the Drive Back in Time Festival, the Golden Horseshoe Festival and the Harvest Festival, Ian Allen, the Beechworth newsagent, captures this impact: 'The Bakery is an absolutely magnificent drawcard for Beechworth, and any business that draws people to Beechworth means other businesses get the spin off benefits'.

A national and international inspiration

The Beechworth Bakery is a business success icon in Australia, New Zealand and South Africa, and Tom OToole is the now one of the most sought after motivational speakers in Australia. Each year he addresses over 100 events nationally and internationally. His speaking style is likened to 'John Cleese on speed', ICMI Speakers and Enterprises has recorded the following reactions:

•   Excellent. Tom's presentation was inspirational and entertaining. He captured the attention of a young group of managers and held their focus for over the hour he spoke. (McDonalds)

•   Excellent. Tom's animated style in delivering his message on how to improve business was both insightful and hilarious, it was the tonic we needed. (The Age)

•   Quirky, compelling, energetic, a sensational speaker. (Young Presidents Organisation)

•   Excellent. Tom's inspirational story, his genuine enthusiasm and his unique style had even our most cynical staff hanging on his words. (Casino RSL Club)

•   Excellent. Tom captures your attention immediately with his very natural and down to earth approach. A very strong message that everyone can receive and act on. (Lorrain Lea Linen Pty Ltd)

Each year the Beechworth Bakery attracts between 50 and 100 local, interstate and international members of the bakery trade. It has a policy of freely sharing all its information and secrets, including recipes.

The success factors

Tom OToole believes that 'business is so simple, you can miss it' and has a very basic eight point recipe for 'making dough' his way.

Exciting, involving and motivating staff members

Networking and cross-promotion with other local businesses

Being idea obsessive

Avoiding the dream takers and negative energy suckers

Being passionate

Loving cash flow

Tom 'loves hearing the tills ring' and seeing money come across the counter and so is prepared to do 'that little bit extra' to satisfy his customers, for example, opening the Bakery from 6.00 am to 7.00 pm seven days a week, making sure the shelves are full of interesting products, and responding to every request.

Practising outrageous customer service

Tom considers that business success is not about product but about customer service: 'My bread is probably no better than the rest, but our service vision lifts us right out of the crowd'. The Beechworth Bakery has three basic rules:

• Rule 1: Take care of the customer.

• Rule 2: Take care of the customer.

• Rule 3: Take care of the customer.

For Tom, the needs of customers are very simple: 'Look at me, greet me, talk to me, thank me'.

Beechworth Bakery believes in looking at the big picture and realising how much a lifetime customer spends. If any customer is noticed not eating their food, staff are expected to give them back their money plus a cake. With a strong commitment to the philosophy that 'if we don't take care of our customers, someone else will', the Beechworth Bakery issues to all staff a manual providing practical directions for exceptional service.

The 'Advice on handling the complaining customer' section of the manual is reproduced here as part of Appendix A. Tom says, 'Customer complaints are the schoolbooks from which we learn'.

The Beechworth Bakery actively solicits customer feedback and ideas. There are four 'customer comments' boxes spread throughout the shop. Tom puts it this way:

'I believe the simplest way to run the business is to ask the customer. It's like having a free consulting service working for you full time ... In the early days, I was under the impression that we couldn't grow any more. We were turning over about $1.5 million a year. If you're turning $1.5 million cash over a bakery counter in Australia, you're doing pretty good. I stuck these customer comment boxes in and they told me how to do it better, and I started to grow'

The Beechworth Bakery receives, responds to and acts on over 200 feedback sheets a month.

Avoiding the bland and daring to be different in marketing

The Beechworth Bakery believes in providing a 'retail experience' and in constantly introducing zany innovations to attract, excite and entertain the customers. Says Tom, 'In every town and business, there has to be the wow factor, wow is the answer'. The Beechworth Bakery was one of the first, both in Beechworth and in the bakery industry, to put chairs outside on the pavement. The desire for marketing innovation is demonstrated by the following:

•   product diversity, the Bakery has over 260 bakery lines

•   a jazz band on the balcony every Sunday

•   pipes from the bakehouse to the verandah and fans to pump hot bread smells up and down the street

•   distribution of 'Beechworth dollars' and coffee coupons to local and regional accommodation businesses to entice their customers to visit the Bakery and the town

•   active support of special events in the town and a calendar of in-store special events for example, Pyjama Day, St Patrick's Day, Kid's Day, Donut Day and the pie eating competition

•   a 1929 A model Ford truck for assisting with special promotions

•   positive posters throughout the shop and especially in the toilets

•   use of the Bakery as a fun community meeting space.

Exciting, involving and motivating staff members

Tom says, 'My staff are the key to our success. I am just one of 74,and the most useless one, so they tell me... My business is about people. We so often think it is about product. If my place burnt down tomorrow, and as long as my staff were not cooked, I could be operating down the road within hours'

Tom has implemented an extensive range of initiatives to empower staff and build commitment to the Bakery family, among them the following:

•   a national and international staff visit and exchange program for example, four staff went to New Zealand in 2003

•   staff recognition initiatives

•   ten staff meetings every six weeks, where the staff determine the agenda and the meeting is conducted in a carnival atmosphere

•   staff family nights

•   a weekly staff newsletter, The Bread Line

•   making all financial figures available to staff

•   provision of a staff room for family members, including children after school

•   regular staff professional development opportunities

•   the opportunity to buy into the business as a partner.

Networking and cross-promotion with other local businesses

The Beechworth Bakery seeks to promote business collaboration and cross-promotion. Tom and Christine OToole have a personal and professional commitment to the town of Beechworth and to north-eastern Victoria. Actions that demonstrate this philosophy include the following:

•   use of place mats that advertise other Beechworth attractions and businesses

•   participation in, and leadership of, the local chamber of commerce

•   all staff participating in town tourism familiarisation tours

•   sponsorship of business development nights at the Bakery for local business people.

Being idea obsessive

Despite operating the top selling retail bakery in the Southern Hemisphere, Torn and Christine are constantly looking for that next great idea. They believe the Bakery is far from perfect, that there is always room for improvement and innovation. Each year they attend national and international bakery conventions and tour other states and countries. They also helped establish the Bakery Think Tank, where they and 10 other Australian and New Zealand bakers gather twice a year to explore new ways forward and support each other's personal and professional development.

Tom's attitude to being a continuous learner is well summarised by this statement: 'I really believe that the more we learn, the more we earn. I travel beyond my backyard, to Germany, to see what sorts of things they do over there. All the time I'm listening to tapes and reading books, trying to learn about business'

Avoiding the dream takers and negative energy suckers

Tom OToole's devotion to positive thinking has taught him about the influence of what he refers to as 'dream takers' and 'energy suckers', and he actively avoids their presence and participation in his business. He is adamant that 'It is the believers in this world that pick up the prizes ... Don't let the dream takers steal your day'.

Being passionate

Four quotes from the Ovens and Kiewa Valley Echo (4 November 2000, p. 4) encapsulate Tom's belief in passion:

•   Passion. If your heart's not in it, get out. The sky's the limit if your heart is in it. You have got to have enthusiasm. If you haven't got enthusiasm, you're buggered.

•   We all have to be passionate in everything we do and say. I can't bear to be around people who are bland or bored. There's a breed of brain-dead, gum-chewing assistants in so many shops, I want our people to feel excitement about our culture and our product.

•   Live life to the full. Always ask yourself, 'How long am I going to be dead?' and get into life.

•   I've concluded that life is about getting up in the morning, in love with life and rarin' to go. Ya gotta get into it.

Local economic development consultant, Peter Palmer summarises the Bakery's formula: 'Tom and the Beechworth Bakery give the mere mortal and small towns hope for the future. They have shown that it is no rocket science stuff, but to do with a pile of basics'

Advice to others contemplating rural business creation

Tom OToole has a series of one-liners that represent his advice to others wanting to emulate his success in rural Australia:

•   If this bugger can make it in business, anyone can.

•   It's 5 per cent technology, 95 per cent psychology and attitude.

•   Have belief in yourself, and get out of your comfort zone.

•   Go that little bit extra, because the difference between the ordinary and the extraordinary is that little bit extra.

•   We are there for the customers, but people forget that. We get so tied up in our spreadsheets and data that we forget we are there for the customers. We forget about the people wanting to give us money.

•   Be part of your community. Stick up your hand and get involved.

•   If you are not determined, utterly and totally determined, to stand out, you're history. We get so comfortable. We get store blind, shop blind, town blind... it's about change, it's about going beyond your own backyard, getting outside that comfort zone.

•   The biggest sin is sitting on your arse. You've got to think, 'If it is to be, it's up to me'.

•   If your heart's in it, the sky's the limit. Get in there, boots and all.

And the best advice Tom believes he was given was 'to read The Power of Positive Thinking by Norman Vincent Peale, so now within 15 minutes of waking up in the morning, before all the shit comes in, I read a line or two from that... people get caught up in studying doom and gloom, but I say study success and happiness instead'  Finally, as a passionate rural Australian, Tom advises, 'Take a risk. Turn off the television. Get out there and see what rural Australia has to offer, the future is right here in rural Australia'.

For further information contact Tom and Christine O'Toole

Owners
The Beechworth Bakery
27 Camp Street
Beechworth Vic 3747

Phone: 0357281132
Fax: 0357281455
Email: enquiries@beechworthbakery.com

Website: www.beechworthbakery.com

For information about Tom's speaking engagements contact ICMI Speakers and Enterprises
phone: 1800 334 625.