Kalona Bakery owners Derald and Marilyn Bender purchased the former Miller’s Kitchen Bakery in 1979 and continued making excellent baked goods for local customers, tourists, and several retail outlets. The Bender family was born and raised in Kalona. Marilyn is responsible for human resources and jointly manages the bakery’s daily operations with her daughter, Vicki. Marilyn’s husband, Derald, retired from a manufacturing business and is now responsible for product distribution; their son, Michael, is the company’s information technology specialist.

Located in the midst of Amish country, Kalona Bakery specializes in preparing old fashioned, mouth watering, baked goods. The bakery features its famous cinnamon rolls along with cupcakes, pies, fresh baked breads, and tapioca puddings. The Bakery’s special Angel Food cake disappears quickly from their store, especially during the holidays. Homemade Amish-style noodles are also a big favorite with local customers as well as shoppers at Hy-Vee and Fareway grocery stores.

Marilyn Bender contacted the University of Iowa’s Small Business Development Center (SBDC) in October 2008 following the June flooding and subsequent economic downturn. Profits were down and interest costs were rising. SBDC counselor Tom Pickering was assigned to work with Marilyn and her family.

Tom did an extensive analysis of the company’s business operations and financial data, which led to the development of a comprehensive business plan. Capital restructuring was arranged with an SBA loan, and an internal system was developed to monitor the daily cost of raw materials. SBDC assistance resulted in a ten percent reduction of material costs to sales, and a ten percent increase in gross profits. Net income for the first quarter of 2010 was up 20.8% over the first quarter of 2009.

With the help of the SBDC, the company has four new distributors and has hired three additional employees during the past twelve months. Tom continues to review the Bakery’s quarterly financial data in order to help the owners avoid unexpected shifts in non-fixed expenses and to identify opportunities to improve profitability.

Marilyn says, “SBDC has been awesome with their support. Their work with us has been very helpful in every area of our business, and their recommendations during the slow winter months helped us keep our employees working.”

During the counseling process Tom also identified the company’s need for a succession plan. Marilyn Bender and her daughter, Vicki, attended an SBDC-sponsored business succession planning workshop and are scheduled to complete a succession plan in the fall of 2010 with the assistance of the SBDC.

The 4,000 square foot bakery is divided into separate areas for baked goods production, noodle production, packaging, an in-store sales room, and a deli/restaurant serving room that specializes in homemade soups, salads and sandwiches. The store is open for business six days a week. Kalona Bakery products and its recently published cookbook, Old Fashioned Amish Country Cookbook, can be ordered on the company’s web site at kalonabakery.com. Internet sales continue to grow as customers become aware that baked goods and other products can be ordered online. Kalona Bakery’s quality and its customer satisfaction can be measured by the high marks they receive every year in KCRG-TV’s award for Eastern Iowa’s Best Bakery.

In addition to their retail business, Kalona Bakery sells wholesale products to distributors in Iowa, Illinois, Minnesota, Wisconsin and Colorado. The Bender family encourages everyone to stop by Kalona Bakery to visit with them while enjoying delicious baked goods with a good cup of coffee.