Since the beginning of 2017, the US-based company Pretzel Baron, which produces pretzels for the US market in Cincinnati, has been part of the Valora Group. Its founder Gary Gottenbusch refers to the sale to Valora as a godsend for his family business. “For me, it’s like being called to the Champions League”.
The link between Gary Gottenbusch and Ditsch began more than 40 years ago when 18-year-old Gary learnt the art of pretzel baking in the German city of Münster. He describes the magic moment when his master at that time showed him how to make a perfectly formed pretzel from a long strand of dough by elegantly throwing it into the air. This moment left a lasting impression on him.
The smell of fresh pretzels still triggers emotions in him to this day. And he enjoys nothing more than to share these emotions with his employees and customers. Together with his siblings, Gary Gottenbusch successfully managed a bakery in Cincinnati for many years. But Gary wanted more. With the help of technology, he was looking for a way that would allow him to produce pretzels in greater numbers without having to give up anything in terms of quality. In 2014, he found what he was looking for, and Gary built his first modern production line for deep-frozen lye rolls in Cincinnati. He has been selling the pretzels produced here under the name Pretzel Baron since 2016. And with success.
This success caught Valora’s attention and it identified the passionate baker Gary Gottenbusch as its ideal partner for the company’s expansion into the US. Previously, Valora had supplied the US market from Germany. Thanks to the acquisition of Pretzel Baron at the beginning of 2017, Valora can now serve US customers locally.
Further investments are already following
With the approximately 50 million pretzels it produces each year, Pretzel Baron has also increased Valora’s current total annual production capacity to around 600 million units of baked goods. However, these 50 million pretzels by no means represent the upper limit. Fortunately, Garry Gottenbusch believed in the enormous potential of the US market from an early stage. This is evidenced by the fact that the production hall he built easily has room for several additional production lines. “Without a strong partner like Valora, growth wouldn’t have been an option for me at all”, says a convinced Gary Gottenbusch. “Valora not only provides capital, but also technological know-how. And Valora knows what it means to produce good pretzels”.
Pretzels meet American tastes
Gary Gottenbusch is very optimistic about the future of Pretzel Baron. After all, in addition to the fact that the US is already the world’s second largest pretzel market, a further trend is also playing an important role: retro is in vogue. Americans are increasingly rediscovering artisan products and learning to attach value to fresh ingredients. This has been observed in the boom in micro-breweries over recent years, and Gary Gottenbusch believes that it will also be the case for pretzels.
The figures support this view: in Germany, pretzels today account for around 3.5% of all bakery and bread products, while in the US this figure has until now remained below 1%. In Germany, each person consumes around two kilograms of pretzels every year, while annual consumption in the US is barely half a kilogram per person. Expected growth rates in the US are therefore significantly higher than those in Germany. And this is precisely what Valora wants to benefit from.
When asked whether it was not a difficult step for him to change from an independent family entrepreneur to an employee of a major group, Gary Gottenbusch answers as follows: “On the contrary. Valora is allowing me to implement my vision of producing the best pretzels in the US at full steam. For me, it’s like being called to the Champions League”.
This is the arena in which Valora already operates with its Food Service division and Valora’s B2B business, in particular, is growing strongly. Demand for lye rolls is so great that Valora is set to invest a total of approximately EUR 50 million in the expansion of its production capacities in Germany and the US over the next two years. “I view myself as an important part of this Valora and Ditsch growth strategy and am looking forward to opening the door to the enormous US market”, says Gary Gottenbusch.